Accounting CPE podcast company
"LumiQ is exactly the kind of market leading B2B software-enabled technology company that Vertu looks to invest in," said Eric Kafka, principal with Vertu Capital. "This is a fast-growing and unique company in an exciting space that is primed to accelerate its domestic and international growth. We are delighted to partner with LumiQ and welcome them into the Vertu family."
While the specifics of the deal were not disclosed, LumiQ CEO Michael Kravshik, in an interview, said Vertu Capital generally writes checks between $25 million and $75 million and generally targets companies with valuations of less than half a billion with annual revenues of around $20 million. As part of the deal, Kafka will be added to the board.
Vertu is no stranger to LumiQ. Kravshik said he has known Kafka, as well as Vertu founder and managing partner Lisa Melchior, for about two and a half years, during which time LumiQ expanded into the US and went from about 35 employees to almost 100.
"We've always felt like there was a lot of alignment in terms of our approach to running a business. And when we finally reached the kind of scale where [expansion] actually made sense, they were some of the first people we were talking to. And I would say I had my fingers crossed that they would end up winning the process, so to speak, and that's what ended up happening, which was wonderful," he said.
Kravshik is well aware that certain private equity deals can go poorly for companies that take their money (there are, in fact, several podcasts on the LumiQ platform on this exact topic) but expressed a great deal of trust in Vertu on the strength of these relationships.
The overall product, according to Kravshik, has both a content component and a technology component. The new capital won't necessarily change LumiQ's strategy on these two fronts but, rather, accelerate it. In terms of content, the company plans to accelerate its releases to cover a wider range of topics commensurate with its increasingly broad range of users. Over the years, said Kravshik, they have found that the content people like varies dramatically based on factors like geography, firm size, practice areas, or industry specializations. He noted there's a robust audience coming from the corporate accounting world too.
LumiQ also wants to enhance the production value of its content. There are already "special features" content that are basically audio documentaries in the vein of a general audience podcast, as opposed to CPE sessions where the speaker just reads from a FASB standard for an hour. Kravshik said users should see an uptick in new content and materials within the next few months over and above the near-daily updates they have right now.
On the technology side, LumiQ has already focused a lot on the user experience, and the new capital will accelerate its plans in this area. For one, LumiQ intends to eventually enhance its customization options, saying a lot of firms have expressed a desire to have more control over the platform itself. The company has already been working on new capacities in terms of managing a particular set of users, assigning episodes to specific team members, or seeing what other firm members are listening to. In general, they want to emphasize things that allow customers to better personalize their experience to better fit their particular circumstances.
Overall, the acquisition does not represent a dramatic change in LumiQ's overall strategy but, rather, a scaling up and acceleration of the one they already have.
"If you love LumiQ you're going to get more of what you already experienced. I wouldn't expect anything to diverge too significantly from what you experienced before. Thankfully we found great partners really aligned with how we see the business and that is what convinced us to do it," he said.
