Boston fintech firm's Chile acquisition good for Atlanta | Crain's Atlanta

Boston fintech firm's Chile acquisition good for Atlanta

Andy Hovancik, Sovos CEO | Photo courtesy of Sovos

A Boston-area financial technology company has made an acquisition in Latin America that looks to expand its presence in the Atlanta area.

Sovos, a tax compliance and reporting cloud software company based in Wilmington, Mass., announced this week that it had acquired Paperless, a 14-year-old Chile-based company. Terms of the deal weren’t disclosed.

This deal comes a year after Sovos acquired Invoiceware International, a five-year-old company based in Smyrna. Invoiceware focuses on electronic invoicing and tax compliance in Latin America.

“Atlanta is an important regional hub for the Americas,” said Andy Hovancik, Sovos chief executive officer. “We expect the Atlanta office to grow more as the result of this acquisition.”

Paperless manages electronic receipts and electronic documents, processing more than two billion transactions last year, according to Sovos. Its client list includes HP, InBev and Cencosud, South America’s largest retailer.

For Sovos, the deal expands the company into Columbia, Peru and Chile. But it also expands the company’s government reporting capabilities at the point of sale for consumers.

“Latin America has been a global proving ground for innovative methods by governments to enforce and collect tax from the companies operating within their borders," John Gledhill, vice president of corporate development at Sovos, said in a release. "What starts there spreads around the world."

Sovos has offices in the U.S., Europe and Latin America and continues to tap into a growing market for government compliance.

A March report from New York-based Persistence Market Research showed that the global market for “enterprise, governance, risk and compliance” would hit $16 billion this year and $30 billion by 2026.

"Countries around the world are grappling to better define and execute budget issues at the government level,” Hovancik said. “Those companies who do business globally must therefore deal with the reality of an increasingly complex compliance environment moving forward." 

In just four and half years, the company has grown from 170 employees and $50 million in revenue to just under 1,000 employees with more than $200 million revenue, Hovancik said.

Sovos spun out of payroll software company ADP in 2012 when Vista Equity Partners bought Taxware from ADP.

“We’ve grown organically,” Hovancik said. But he added that the mergers and acquisition activity has fueled major growth.

Prior to acquiring Invoiceware, Sovos bought Imagining Science & Services based in Ohio in 2015. That followed the acquisition of Minnetonka, Minn.-based Convey Compliance Systems the previous year. Both are cloud-based tax compliance and document management companies.

Last year, Vista Equity sold a majority stake in Sovos to London-based HgCapital.

Hovancik said the plan is to continue to grow “a world class business and solve a world class problem.” 

August 2, 2017 - 3:23pm