Major E-Discovery News, As Exterro, Eyeing IPO, Acquires Zapproved for Undisclosed Amount


Among the things the two e-discovery companies Exterro and Zapproved have in common is that they were both founded in the same year, 2008, and in the same city, Portland, Ore. Now they have something else in common, as they announce today that Exterro has acquired Zapproved.

While the terms of the acquisition were not disclosed, Exterro said that the acquisition accelerates its mission to empower its customers “to proactively and defensibly manage their legal governance, risk and compliance (GRC) obligations.”

Monica Enand

For Zapproved, the deal represents a major exit for a legal technology company that was founded and run by a woman, Monica Enand, who formed the company in 2008 and remained CEO throughout its existence. She and her entire team will join Exterro.

The deal is also a notable exit for Zapproved’s largest investor, K1 Investment Management, an investment firm focused on high-growth enterprise software companies, which led a $15 million Series C funding round in Zapproved in 2015. K1 will roll a portion of the proceeds back into Zapproved, retaining a minority stake in the business.

(K1 has been a major investor in legal tech, having previously invested in a portfolio of companies that include $200 million in Reveal in 2021, $200 million in Onit in 2019, and $100 million in Litera in 2016, from which it exited in 2018).

“K1 was my first institutional investor, and we shared a passion for building successful businesses and having a positive impact on our communities,” Enand said in a statement. “K1 supported both our 10x growth, and our focus of building a culture of belonging and inclusion, with an employee base that reflects its community.”

Eyeing An IPO

In an interview yesterday, Bobby Balachandran, Exterro’s CEO and president, told me that this acquisition will strengthen the company in its mission to enable organizations to use the power of their data while reducing the associated risks around legal governance and compliance.

Bobby Balanchdran

The acquisition will also strengthen the company’s preparedness for an IPO when the market recovers from its current volatility. In previous interviews with Balachandran on my podcast in 2021 and when the company underwent a major recapitalization last July, he said that an IPO was on the horizon, and yesterday he reiterated that goal for when the market gets better.

Today’s news follows Exterro’s news last July that it had completed a strategic recapitalization and secured additional committed equity capital as part of a deal that provided it with “several hundred million” in new funding at a valuation of more than $1 billion. As part of that deal, Leeds Equity Partners, which invested more than $100 million in Exterro in 2018, made a new equity commitment to the company. 

Balachandran said at that time that the money would be used to grow Exterro’s portfolio of legal GRC software products through acquisitions and product development, and he said yesterday that today’s acquisition follows through on that promise.

Exterro’s last major acquisition was 2020, when it acquired AccessData, then one of the leading providers of digital forensic investigation technology, in a deal valued at more than $100 million.

Neighbors with a Common Vision

Balachandran and Monica Enand, Zapproved’s CEO and president, said they have known each other and frequently spoken since both companies’ early days.

“Over the years we have faced each other many times and pushed each other to innovate, to challenge the status quo and to create compelling solutions that meet the ever-increasing demands placed on our customers,” Balachandran said. “Most importantly, we share a common vision for providing market-leading support for our clients and partners. Today, we come together to raise the bar for the industry and deliver the most comprehensive legal GRC solution on the market.”


Related: On LawNext: Exterro’s Bobby Balachandran, ‘LegalTech CEO of the Year,’ On Leadership, Growth and Plans for an IPO.


Exterro provides a range of software products through a unified platform for e-discovery, forensic investigations, governance, risk and compliance, and serves the legal market broadly, including law firms, corporate legal departments, government and law enforcement. Zapproved focuses its market more narrowly on corporate legal departments and provides a platform for legal holds, data collection, and data review.


Learn more about Exterro products on the LawNext Legal Tech Directory: Exterro E-Discovery Data Management, Exterro Legal Hold, Exterro Review.


Highlights of the acquisition, the companies say, include:

  • Exterro’s comprehensive platform will combine with Zapproved’s world-class customer experience to form one powerful and easy-to-use solution to defensibly manage legal GRC obligations.
  • The acquisition will strengthen Exterro’s e-discovery suite and will deliver compelling value to organizations looking to bring all or part of the e-discovery process in house.
  • Exterro’s AI-driven early case assessment, its smart labeling capabilities, and its broad set of enterprise connectors will help organizations drive down review costs by reducing the set of data needed for review.
  • Exterro’s embedded process-orchestration capabilities will help customers get the facts of every matter more quickly, defensively and at lower costs.
  • The acquisition provides a path for Zapproved customers to adopt a seamless approach to incorporating forensic collection and review capabilities into their e-discovery process when required.

“Bobby Balachandran and I have spoken extensively over the years and have a unique understanding of the pressures our industry is under to decrease costs while improving productivity, efficiency and end results,” said Enand. “We are confident that this acquisition is the right solution to address those critical business challenges.”

Best of Both Worlds

All of Zapproved’s roughly 130 executives and employees are remaining with the company, including Enand, for a combined workforce of some 750 employees, Balachandran said.

The two companies have formed an integration team that will consider how best to combine the strengths of each company’s products and culture.

Zapproved’s strengths, he said, includes world-class customer service and a unique set of software to serve its enterprise customers. Exterro’s strengths include its innovation-focused research and development team and a platform that offers enterprise customers broader options for GRC and forensics.

“We will look at the best of both worlds, take a very customer-centric approach to looking at what we’ve done and what they’ve done, and then decide based on that what’s best for our clients,” Balachandran said.



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