Compliance and documentation technology provider Docutech has formed a partnership with San Francisco-based private equity firm Serent Capital.
Through the partnership, Serent will become a minority investor in Docutech, the companies announced Thursday. Docutech's executive team, including founder and chief executive Ty Jenkins, will continue to lead the company's strategic operations.
This is hardly Serent's first rodeo when it comes to investing in mortgage technology companies. Serent Capital previously invested in product and pricing engine software vendor Optimal Blue,
Serent approached Docutech about forming a partnership — one of roughly 18 different companies that Jenkins said had expressed interest in them.
"Their focus is founder-based, high-growth companies that are very profitable," Jenkins said in an interview with National Mortgage News. "We were right in their target."
In a news release, the companies noted that Serent cited Docutech's leadership and product mix as deciding factors in its choice to invest in the company.
Jenkins noted that Docutech was less interested in the financial benefits of a relationship with a private equity firm when it made the choice to strike a deal with Serent.
"We weren't looking for a partner to bring us capital," he said. "What we were looking for is a company with a good operational skillset."
Docutech is looking to improve its operational management and best practices through the Serent partnership. In particular, Jenkins cited talent acquisition as another area where Serent will be able to assist them.
The Serent relationship will also help Docutech approach the M&A space as the Idaho Falls, Idaho, company looks to expand its product mix.
"One of the most efficient ways to enter a space is through M&A," Jenkins said. "Having a private equity partner was very attractive to us because they do that for a living and can bring some expertise."
Docutech has not yet determined a specific part of the market they will approach through acquisitions, but Jenkins said that the company is looking "at the whole banking process…identifying areas where we can bring value."
