Portland software maker LegitScript made its first acquisition by scooping up a Beaverton startup that will boost the company’s AI capabilities.
LegitScript bought Fox and Geese, a small company that makes a product called Fluxguard. As part of the deal five full-time Fox and Geese team members, including founder Peter Bray, are joining LegitScript. Bray will be general manager of the Fluxguard product, said LegitScript CEO Scott Roth.
Fluxguard is a tool that customers can use to monitor the changes made to websites, including sites that require registration. The software uses artificial intelligence to detect new and deleted content. The product is used by customers who want to monitor competitors or vendors, surface their own internal changes their websites or monitor changes to regulatory sites.
The tool is used by more than 150 compliance and risk management teams, according to the companies.
“As part of our overall growth strategy we are looking at everything in our existing wheelhouse and also looking at things adjacent to the core offering,” said Roth. “The Fluxguard capabilities check the box for both. What they built is something that could enhance our existing offerings.”
LegitScript, which has 230 employees, has been around since 2007. The company is majority-owned by private equity firm PSG and The Jordan Co.
LegitScript works with search engines, e-commerce platforms and payments companies to ensure that merchants and products and services on websites are legitimate businesses and following regulations. The company uses big data and machine learning software plus experienced staff to monitor and certify entities.
The company was evaluating how to respond to customer requests for website change monitoring when the potential for an acquisition presented itself. Part of the process is deciding whether to build a tool in-house, partner with an existing company, or make an acquisition, said Roth.
The company found the Fluxguard tool and initially started talking to Bray about a partnership.
“One thing led to another, and it felt like a good fit,” Roth said.
He added that LegitScript customers, such as those in the payments space, have been figuring out how to work with third party vendors in ways that stay in compliance with shifting regulations as well as with terms of service that customers have agreed to.
“You need to be certain the payment processing capabilities are legal and within terms of service. Detecting very specific changes to (a vendor or partner) website is important,” Roth said.
Bray and his team are strong in engineering and they saw a deal with LegitScript as a way to help them go to market and to have a broader reach, Roth said.
Fluxguard will still be available to customers as a standalone product. The teams will also work to integrate the Fluxguard capabilities as well as some other Fox and Geese products into LegitScript tools.
“We are extremely excited to join forces with the LegitScript team so that we can continue to bring to life our vision for Fluxguard and also enhance LegitScript’s existing capabilities,” said Bray in a written statement. “Our companies are aligned on a similar mission and vision for using advanced technology to solve complex business problems for risk and compliance teams.”
Fox and Geese has grown organically and through federal research contracts, the most recent awarded earlier this year. LegitScript will take over those research contracts, Roth said.
