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What are the five most successful companies in the eDiscovery space?
Hello! Thank You for your question on the five most successful companies in the eDiscovery industry today. Based on your question, I have focused my research on incumbent businesses. Following an in-depth research, I found DTI, Kroll Ontrack, LDiscovery, Advanced Discovery, and Lighthouse eDiscovery to be the top five eDiscovery companies. Below here, you will find both my research methodology and a broad summary of each of the above mentioned players.
I: METHODOLOGY:
I initiated the search through a business database and came across Applied Discovery - a major eDiscovery company founded in 1998. A brief look at the company’s history showed it was acquired by DTI in 2007. While further investigation showed DTI to be the market leader in the eDiscovery space, the other four companies in the Top 5 list based on their revenue, acquisition history, brand and global reach are : Kroll Ontrack, LDiscovery, Advanced Discovery and Lighthouse eDiscovery. I have added the brief profile of a company that provides eDiscovery automation services given the interest and growth in that segment - the company profiled is not from the recent VC funded legal technology companies as per your specifications. I have closed the summary with a brief note on the challenges faced by the industry today. A final important note before I deep dive into the summary - the website "Owler" used to gain revenue figures can be accessed through a sign-in only.
Without further ado, please find the company descriptions starting here:
II: COMPANY PROFILES:
DTI was founded in 1998 as a legal facilities management business. The company expanded into e-filing and digital storage industry in 2003, which led them to develop ESI functions, including computer forensics. DTI's first eDiscovery acquisition was Daticon EED in 2010; one of the original and widely recognized eDiscovery providers at the time. This acquisition brought DTI’s value to $130 million and made them a transcontinental provider of eDiscovery services.
DTI’s most recent milestone came with its 2016 merger with Epiq, an integrated technology and legal services giant. This merger purportedly will make both companies into one of the largest global eDiscovery and legal services provider. Following the integration process, the company will be based out of Atlanta, GA and have over 100 global locations.
The company appears to have achieved much success through acquisitions and mergers and their estimated revenue is now around $550 million. DTI as an organization promises to remain focused on client needs while continuing to expand its capabilities.
LDISCOVERY AND KROLL ONTRACK
LDiscovery was founded in 2005 and has been rebranded as KrolLDiscovery just this year(2017), following its acquisition of the larger Kroll Ontrack. Known to have a revenue of at least $100 million, the company started expanding its eDiscovery services in 2013 with the acquisition of AlphaLit, a 30-year-old eDiscovery service provider. AlphaLit was known for its innovative methods and for their work with the government. A year later LDiscovery merged with RenewData, a specialist in acceleration tools and enterprise solutions. The merger also meant that LDiscovery acquired large data centers. There were two other acquisitions in 2014, FlashData and Turnstone Solutions, both of which were intended to help expand in the New York market. 2015 saw the addition of Interlegis, Credence, and CopySecure to the LDiscovery brand. Each of these acquisitions served to increase production and provide the best solutions for clients. The 2016 acquisitions further expanded the company’s presence. They gained a Washington DC office with the acquisition of Elite Document Solutions, and global presence through Kroll Ontrack.
Kroll Ontrack is a leading provider of data recovery, legal technology, data destruction, e-discovery, and document review solutions. The company serves 12,000 international clients, which when combined with LDiscovery’s other subsidiaries has made KrolLDiscovery a leader in the global market. With all the mergers and acquisitions, it is not hard to see why LDiscovery is rated as one of the fastest growing companies in North America by Inc. Magazine and Deloitte.
ADVANCED DISCOVERY
With an estimated revenue of $70 million, Advanced Discovery is an Austin, Texas based company founded in 2002. The company focuses on providing litigation support, data analysis, data collection and eDiscovery. It recently joined Inc.5000's "Honor Roll" as a 5-time honoree - the same article shows the legal services company demonstrated a "phenomenal three-year growth of 117%". Similar to the above top players, much of its growth appears to have come via the acquisition strategy.
The company merged with CP Document Technologies in 2011. This moved allowed the company to not only expand its client base but also attract seasoned professionals. The merger also gave CP Document Technologies access to Advance Discovery’s resources and tools.
Their next acquisition in 2014 with Responsive Data Solutions (RDS) extended the company's reach to the East Coast market. RDS offered a flexible diverse suite of services that included forensics and eDiscovery processing. Advanced Discovery also benefited from the use of RDS’s Xpress platform that allows quicker access to files.
Advanced Discovery made a smaller acquisition in 2015 with Ditto Documents' eDiscovery division. Ditto was a small document on demand operation and not much is known about the details of the acquisition. The next acquisition in 2016 however was a big one when they acquired Millnet, the largest and longest established UK-headquartered eDiscovery and legal document firm. This move made the company a truly global entity and fulfilled the company’s promise to provide global support. Millnet will continue to operate under its brand name and the combined companies will provide a larger array of services for clients.
LIGHTHOUSE EDISCOVERY
Lighthouse eDiscovery, formerly Lighthouse Document Technologies, shifted its focused from documents to eDiscovery in 2012. This was driven by the growth of digital data and corporations need to manage information. Lighthouse focuses on creating streamlined platforms that save time and money.
Lighthouse eDiscovery surprisingly has no major acquisitions, but they do have awards that mark them as industry leaders. These include Relativity Best in Service, Relativity Innovation Award, and Columbia Pacific Advisors “2013 Portfolio Company of the Year.” Even without any added subsidiaries, Lighthouse eDiscovery has an estimated revenue of $30 million.
CLOUDNINE
CloudNine was founded in 2002 and is based out of Houston, Texas. It describes itself as a - "legal intelligence technology company with deep expertise in the analysis, processing, and review of electronically stored information (ESI)."
Widely considered a leader in eDiscovery automation, CloudNine also offers a complete portfolio of litigation and eDiscovery professional services such as - managed services, managed review and computer forensics. Its clientele are from 50 of the 'top 250 Am Law firms' and the legal technology company has also been featured in respected publications such as Gartner and Corporate Counsel. The bootstrap financed company is also credited for bringing Software-as-a-Service (SaaS) Document Review technology to the legal services market. While a documented current revenue is unavailable, given that CloudNine was on Inc.5000's list of fastest growing companies as early as 2011, it would estimatedly need to have a revenue of at least $2 million as of the year of being listed. (Interpreted as per Inc.5000's year 2011 rating methodology)
NEW CHALLENGES
eDiscovery faces new challenges in a world where everyone is becoming more connected. This is especially true in regards to social media and the Internet of Things. This raises legal questions and has created a need for regulation reform.
Social media is not just for personal networking anymore. Businesses are now using social media platforms to advertise, share workflows, chat and conduct business. Social media has become an important part of eDiscovery, but most eDiscovery software was not designed for that purpose. The main issue with analyzing and gathering data from social media accounts is that it often is not all in one place. It becomes important that attorneys know the exact scope of search so they do not run the risk of gathering unnecessary data or data they do not have the right to extract.
The lack of the right to information during eDiscovery, became national news when police tried to subpoena Amazon during a murder case in 2016. The case involved the Amazon Echo, a voice activated device and its possible recording of voices at crime scenes. Amazon denied the request, but the case brought up questions of data ownership. These questions are being worked out through new laws and regulations. Until the arrival of agreed upon methods, these platforms are inaccessible for eDiscovery teams.
CLOUD-BASED EDISCOVERY
Another growing facet of eDiscovery is cloud-base eDiscovery and services. “Cloud computing” refers to internet-based computing services not running on a physical device but on a server located elsewhere. This means that the data is not stored on your computer’s hard drive either. Companies are taking advantage of these services because it means less in house maintenance and cost. Cloud services like in-house servers are susceptible to hacking. This is where new companies like CloudNine and Everlaw are stepping in to create new secure e-Discovery based cloud services that protect sensitive data. This added security is increasing the use of Cloud platforms in law firms.
SUMMARY
In conclusion, the top five eDiscovery companies/firms are DTI, Kroll Ontrack, LDiscovery, Advanced Discovery and Lighthouse eDiscovery - and though relatively small, in its space, CloudNine is considered a leader. Most of the companies have created a large domestic and international presence primarily through mergers and acquisitions.
The eDiscovery space faces new hurdles in data collection due to the growth of social media usage and the internet of things. Companies are also looking at cloud-based services and the need to add security to these platforms through eDiscovery. Changes introduced by increased internet connections will shape the future of the eDiscovery market.
I hope this information has been helpful. Thank You for using Wonder. Please feel free to contact us with any other questions.