Internet Capital Group Inc. Q2 2010 Earnings Call Transcript

| About: Actua Corporation (ACTA)

Internet Capital Group Inc. (ICGE) Q2 2010 Earnings Call July 29, 2010 10:00 AM ET


Karen Greene - VP of IR

Walter Buckley - Co-founder and CEO

Kirk Morgan - CFO


Scott Berg - Feltl & Company

Sasa Zorovic - Janney Montgomery Scott

Jeff Van Rhee - Craig-Hallum Capital

Neil Gagnon - Gagnon Securities


Good day ladies and gentlemen and welcome to second quarter 2010 ICG earnings conference call. My name is Marissa and I will be the lead operator for this call. At this time, all participants are in a listen-only mode. (Operator Instructions) As a reminder, this conference is being recorded for replay purposes. I would now like to turn the conference over to your host for today's call, Mrs. Karen Greene, the Vice President of Investor Relations. You may proceed.

Karen Greene

Good morning. This is Karen Greene with Investor Relations and I want to welcome you to ICG’s second quarter conference call. I would like to remind everyone that we are going to use presentation slides to accompany our prepared remarks today. These slides can be found on our website at Go to the homepage and you will see an icon for our second quarter conference call. The slides can be accessed through that icon. For those of you without immediate access to our website, the conference call and presentation slides will remain on our website and be available for future reference.

On the call this morning, we will be discussing certain non-GAAP financial measures. For additional information on these non-GAAP financial measures, including a reconciliation of these measures to the most comparable GAAP measures, please refer to the press release we put out this morning, including the attachment for the press release itself.

To aid in the comparability of the aggregate core company information, ICG is presenting aggregate core company information assuming the company’s acquisition of GovDelivery occurred on January1st, 2009 by including GovDelivery’s historical results for all periods presented.

The press release is also available on our website, which again is To access the press release on our website, please go to our homepage and select July 29th, 2010 press release. The attachments to the release can be accessed by clicking on the PDF file contained within the release itself.

Before we begin, I would like to briefly review our Safe Harbor language. The statements contained in the press release are not historical facts but forward-looking statements that involve certain risks and uncertainties, including but not limited to risks associated with the effect of economic conditions generally, capital spending by our partner companies' customers, our partner companies' ability to compete successfully against their respective competitors, and our partner companies' ability to timely and effectively respond to technological developments, our ability to have continued access to capital and deploy capital effectively and on acceptable terms, our ability to maximize value in connection with divestures, our ability to retain key personnel and other risks and uncertainties detailed in ICG's filing with the Securities and Exchange Commission. These and other factors may cause actual results to differ materially from those projected.

With that, let me turn the call over to Walter Buckley, ICG's Chairman and CEO.

Walter Buckley

Thanks Karen. Welcome and thank you for joining this morning. Today I will provide an overview ICG and its partner companies for second quarter 2010, and Kirk Morgan, our Chief Financial Officer will follow with ICG’s financial results and review our partner company performance for the quarter.

Overall, we were pleased with the continued strong revenue growth at our core consolidated companies, as well as a number of other key accomplishments that were achieved during the second quarter.

Turning to slide 5, I’ll list the second quarter highlights. Second quarter consolidated revenues were $28.1 million, an increase of 25% over the comparable 2009 period. Aggregate EBITDA for our core consolidated companies excluding stock based compensation and unusual items improved to $2 million. We are excited to have further increased our ownership in ICG Commerce to 81%, and we will be receiving a $25 million cash dividend from ICG Commerce. And finally, we continue to build out the management teams and advisory boards at a number of our companies, and I will elaborate on this in just a few minutes.

With that, I will move on to our partner company highlights which are listed on slide 6 through 10. Now I will begin with ICG Commerce.

ICG Commerce, a leading outsourced procurement provider grew revenues to $23.5 million in the second quarter, an increase from $19.5 million during the second quarter of 2009. ICG Commerce EBITDA, excluding the impact of stock-based compensation on unusual items was $2.6 million in the second quarter, slightly below the $3 million to the comparable 2009 period.

EBITDA during the quarter was impacted by investments the company made in relationship to sales activity, and Kirk will provide greater detail on this in his commentary. ICG Commerce's cash and cash equivalents were $24.1 million at June 30, 2010. During the quarter ICG Commerce had a number of significant contract expansions and extensions, including Hertz, Pinnacle Foods, Vought and a large pharmaceutical customer. In addition just this week, ICG Commerce signed a multi-year multi-million dollar contract with a Fortune 500 company, and is in final negotiations to our very large multi-year contract with a premier high-tech global company.

In order to meet the growing global demand of its client, the company has continued to expand its global delivery platform, with new capabilities located in the Czech Republic and Brazil this quarter. On the marketing front, in a focused effort to expand its presence in the consumer products industry, ICG Commerce hired Thomas Bornemann, a 25-year industry veteran, as a consumer products practice leader. Previously, Mr. Bornemann was a managing partner for the Consumer Products division of Clarkston Consulting, where he worked with numerous leading Fortune 100 CPG companies.

In addition, the company continued to expand its Consumer Products Advisory Board to include Pat Peters, former Senior Vice President of Unilever North America. As the sixth member of the Consumer Products Executive Advisor Board, Mr. Peters joined former executives from ConAgra, Kraft, Bruno's Supermarkets, the Grocery Manufacturers Association and the Food Marketing Institute.

Now turning to GovDelivery, our leading provider of communication technology across all levels of government saw revenue growth of 53% compared to the second quarter of 2009, and with EBITDA positive for the quarter. During the quarter, the company added 1.5 million end users and sent 644 million messages to the public, compared to 448 million in Q2, 2009. The company signed several major new customers this quarter, including its largest deal to date at the state level, which is an enterprise deal covering all state agencies in a single state. GovDelivery also signed a multi-state rollout of its service across 17 state level agencies, sponsor at the federal level with goal of improving collaboration between state and federal offices. And finally, the company signed one of the 10 largest cities in the country to the GovDelivery platform.

During the quarter, the company opened the federal office in Washington DC. This is in response to continue growth at the federal agency level. Today, 100 federal agencies use GovDelivery platform to send messages to the public on range of topics, including environment cleanups, economic indicators, public health, health programs and much more.

Significant growth is anticipated as a number of targeted messages sent by a federal agency through the GovDelivery platform will increase more than 50% in 2010 as compared with last year. Finally, GovDelivery recently hired Mark Capaldini as Executive Vice President, charged with helping to continue the rapid growth in this client base across all government markets. Mark comes to the company with extensive experience, having held senior positions at West/Thomson Reuters, Focus, LexisNexis and The Washington Post.

Investor Force, a leading provider of business solutions for the institutional investment management industry, saw excellent revenue growth at 50% plus and strong EBITDA improvement for the quarter. Investor Force is now supporting four of the top five consulting firms in the industry, with online real-time visibility and extensive analytics into the portfolio holdings, performance data and trading activity. The company has been opening on a number of new products for the Investor Force platform, several of which are expected to be released in the fourth quarter. Finally, the company recently announced really important new additions to the management team, in response to strong growth the company has experience over the past two years.

Jim Satloff joined as the Executive Chairman of Investor Force. He most recently served as the Executive Managing Director of Standard & Poor's investment management business. Steve Johnson was recently appointed as Chief Operating Officer of Investor Force and was most recently COO of Redstone Investment Management. Also joining Investor Force is Chief Information Officer is Amit Basu. Prior to joining to Investor Force, Amit was Managing Director at Albridge Solutions, a leading provider of enterprise data management and portfolio accounting and performance reporting to the broker dealer and investment advisor markets.

Now turning to our some of our core equity holdings. Channel Intelligence closed the second quarter with year-over-year revenue growth of 36%. The CI platform continued to drive improved operating results for the company and its customers and saw significant growth in revenue from performance advertising, as well as a 24% increase in client advertising spend. CI grew its customer list significantly this quarter, which is now comprised of many top tier manufacturers, eight of the top 10 internet retailers and more than half of the Top 50 is determined by their revenue.

Metastorm reported revenues of $17 million in the quarter, compared to $17.5 million in the comparable 2009 period. While in a constant currency basis revenues were actually $17.6 million this quarter versus $17.4 million in a comparable 2009 period. Metastorm’s EBITDA excluding the impact of stock based compensation and unusual items, was a loss of $1.1 million in the second quarter, compared to an EBITDA of $1 million in the comparable 2009 period.

In a first half of this year, Metastorm has made significant investments in sales and marketing to drive growth. Results are beginning to payoff as pipeline activity and deferred software revenues were up considerably going into Q3 compared to a year ago and even quarter ago. The company has also increased its product development expenditures this year. It recently issued new releases of its BPM and ProVision products, as well as its new cloud-based M3 modeling product. New customers joined the quarter, including the US Department of Education, Independence Blue Cross, Louisiana Department of Administration and others, and a number of existing customers also expanded their relationship with Metastorm including LeasePlan, JPMorgan Chase, Publics and Thomson Elite.

And finally, StarCite. We saw solid revenue growth in Q2 on the corporate side of the business, adding global oil and gas and healthcare leaders to its client roster in Q2, as well as contract extensions at a number of large corporate clients. The company also had an 82% increase in RFP transactions and corporate clients for the January through May 2010 period, compared to the same period in 2009. The company also experienced a general increase in meetings and registration activity from new and existing clients. Additionally, StarCite extended it's partnership with American Express for five years.

Finally, the company launched new products, meetings one-to-one during Q2, expanding the functionality of its attendee management system to include one-to-one meeting scheduling, thereby broadening its product offering within the financial and pharmaceutical industries. On the acquisition front, clearly the purchase of an additional interest in ICG Commerce is the most important development year-to-date. We continue to review a strong pipeline of deals for both ICG and our partner companies.

Through our marketing efforts, we are closing tracking activity progress for approximately 3,000 sack and technical BPO companies, establishing relationships with these entrepreneurs and introducing them to ICG, our team and network. In summary, we are pleased with the continued revenue growth at our consolidated companies. Based on year-to-date revenue and EBITDA performance along with pipeline activity in the customer signings subsequent to quarter end, we are well position to meet our 2010 guidance. We are enthusiastic about the opportunity to build and create value at ICG Commerce to our increased ownership stake, as well as our ability to build value at our other partner companies. We are excited about what the future holds and look forward to reporting to you on our progress.

With that, I will turn it over to Kirk Morgan.

Kirk Morgan

Thanks Buck. Let me begin on slide 12 with our second quarter 2010 consolidated income statement. ICG’s second quarter consolidated GAAP revenue was $27.4 million, an increase from $22.1 million in the comparable 2009 quarter. GovDelivery, ICG Commerce and Investor Force were consolidated in the 2010 quarter, while ICG Commerce, Investor Force, Vcommerce were consolidated in the 2009 quarter.

For the first half of 2010, consolidated GAAP revenue was $53.7 million, up $10 million from $43.7 million in a comparable prior year period. This growth is primarily due to revenue growth of ICG Commerce and Investor Force. The impact of GovDelivery's purchase accounting adjustment reduced revenue by $700,000 for the quarter and $1.6 million year-to-date on GAAP basis.

Moving to the bottom-line, consolidated net income for the second quarter of 2010 was $15.8 million or $0.43 per diluted share, primarily driven by gains from the sale of 582,000 shares of Blackboard during the quarter as compared with a net loss of $8.5 million or $0.23 per diluted share in the 2009 period.

Consolidated net income for the six months was $44.5 million or $1.22 per diluted share, again driven primarily from gains on our Blackboard sales, as compared to net loss of $19.5 million or $0.53 per diluted share in the comparable 2009 period.

Slide 13 provides additional color on ICG's reported consolidated net income and loss. Results for all periods presented include significant items, including the 2010 quarter, $23 million in net gains generated from the sale of a portion of our Blackboard holding. The 2009 quarter includes among other items, $3.7 million in an impairment charge.

Having described our GAAP results, let's move on to what I identified in the first quarter as ICG's areas of value, cash and public securities, our consolidated core companies and our equity companies.

From a cash and public securities perspective, ICG ended the quarter with approximately $93 million of total liquidity. Slide 14 presents a summary of this liquidity starting with the movement of cash at the parent company level during the quarter. In the quarter, we deployed a total of $36.5 million, related to partner companies with approximately $35.3 million of that amount for incremental acquisition of 12% of ICG Commerce share in early May. We received $24 million in proceeds from the sale of a portion of our Blackboard shares, received income tax refunds of $6 million and an escrow receipt of $1.3 million and had net cash operating cost of $3.5 million.

At quarter end, we had $55.9 million of cash at the parent company. The value of our public holdings including Blackboard and GoIndustry was $12 million. Additionally, our share of ICG Commerce's cash was approximately $18 million, and at June 30, 2010, we had $6.3 million remaining on its income tax receivable that we expect to receive later in 2010.

Our next area of value is our core consolidated companies. So let me review consolidated core company results on slide 15.

Aggregate revenue of our three consolidated core companies increased to $28.1 million during the second quarter of 2010 from $22.5 million in the 2009 period. As you can see on slide 16, this is an increase of 25% over the comparable 2009 period and brings our year-to-date performance to 25%. A portion of ICG Commerce's revenue is denominated in currencies other than the US dollar. The volatility in the currency markets reduced ICG Commerce's reported revenue by approximately $400,000 in the quarter and reduced it by approximately $500,000 year-to-date. So assuming a constant currency basis, year-to-date revenue growth would be 26%. We estimate the annual impact of the volatility of currency market would be a revenue reduction in the range of $1 million to $1.5 million.

Turning to slide 17, these three companies generated $2 million of EBITDA, excluding stock-based compensation on unusual items, up from $1.8 million in the 2009 quarter.

Year-to-date EBITDA stands at $4 million versus $3.5 million in 2009. The EBITDA improvements in 2010 were impacted by a number of items at ICG Commerce. A continued ramp-up in expenses to support sales activity, operational hiring and expenses in advance of contract signings, payroll related accruals that will reverse in the second half of 2010 and to a lesser extent foreign currency fluctuations.

I estimate these items totaled approximately $2 million for 2010 year-to-date. So, as I evaluate the first half of the year, I think of EBITDA for our core consolidated companies as being closer to $6 million and I continue to expect EBITDA margins to improve in the second half of 2010.

So accordingly, we believe that Q2 and year-to-date performance of these companies keeps us on track for our 2010 goals of consolidated core aggregate revenue in the range of $114.2 million to $120.2 million corresponding to an increase of 20% to 27% compared to 2009, and consolidated core aggregate EBITDA excluding stock-based compensation on unusual items in the range of $12 million to $15 million.

On slide 18, I would like to provide you with some more color on the ICG Commerce transaction, as well as an update on our tax situation with our ownership interest and ICG Commerce increasing to 81% earlier this month.

As previously announced ICG recently completed two transactions in which we acquired an additional 17% of ICG Commerce for a total of $49.7 million cash. In addition, last week ICG Commerce declared a $27 million dividend of which ICG will receive $25.4 million. The dividend will be funded from ICG Commerce's existing cash balance of $24 million and borrowing under a new credit facility.

On pro forma basis, the net funding from ICG for its purchase of additional shares in ICG Commerce will be the $49.7 million funded less the $25.4 million dividend or a net of $24.3 million. After the dividend and borrowing at ICG Commerce, I would estimate the pro forma cash at ICG Commerce to be approximately $17 million and borrowing under the credit facility of approximately $20 million, again pro form as of June 30th.

From a tax perspective, the ICG Commerce transactions allow ICG to optimize its consolidated tax position. With an 81% stake, ICG will begin to consolidate ICG Commerce in our consolidated tax return beginning in the third quarter of 2010. Generally speaking, ICG will utilize any current year ICG operating losses and ICG’s NOLs in additional to ICGC's NOLs to offset ICG Commerce's taxable income.

At December 31st, 2009, ICG had over $240 million of NOLs available, including $54.4 available in 2010 and ICG Commerce had approximately $74 million of NOLs available for utilization in the future. Additionally, as a reminder, at December 31st, 2009, ICG also had the basis in its companies of approximately $500 million, which will be utilized to calculate any capital gains upon monetizations.

Moving on to our core equity companies on slide 19, ICG's five equity method companies included in the core category, Channel Intelligence, Freeborders, Metastorm, StarCite and White Fence reported aggregate revenue of $43.8 million in the quarter, compared to $46.6 million in the 2009 quarter. Channel had another excellent quarter as Buck alluded to; Freeborders, Metastorm, StarCite and White Fence continued to feel the impact of the economic pull back.

Now little more color on Metastorm, again a portion of Metastorm's revenue is denominated in currencies other than the US dollar. The currency volatility reduced Metastorm's quarterly revenue by approximately $600,000.

Moving to EBITDA, exclusive of stock-based compensation and unusual items, these five companies generated an EBITDA loss of $2.3 million during the second quarter, compared to positive EBITDA of $1.4 million in the 2009 quarter. Metastorm was the largest driver of the decline, as Metastorm is investing significantly to expand its sales and marketing efforts, increased product development was negatively impacted by foreign currency on the bottom line by approximately $400,000. Channel Intelligence also continues to invest to develop and expand its product offerings. We believe these investments will result in increased revenue in the second half of 2010.

To reiterate on slide 20 and closing, we had a solid quarter. Our core consolidated companies are on track to meet our full year revenue and EBITDA guidance. We increased our ownership in our most valuable company and our equity companies are investing for future growth. We look forward to reporting to you on Q3 results in early November. And I will turn back over to Buck.

Walter Buckley

Thanks Kirk. And we’d now like to open it up to questions.

Question-and-Answer Session


(Operator Instructions) You have your first question from the line of Scott Berg from Feltl & Company. Please proceed.

Scott Berg - Feltl & Company

Real quick couple of questions here. First of all on the dividend that’s going to be paid by ICG Commerce. Why borrow $20 million from current facility, why not make the dividend payment smaller and not borrow?

Walter Buckley

It was something that was negotiated upfront with the overall transaction, and it was part of us purchasing the remaining series share. So, it was really part of the overall transaction. In addition, the financing that we put in place we think is very favorable with interest rate rough a little over 3%. And from net-net standpoint, we thought that in a $50 million investment we are receiving $25 million back, it sort of allowed us to operate from an ICG standpoint, sort of unimpeded by this transaction in terms of the best route moving forward on other acquisitions or tuck-in for our exiting companies.

Scott Berg - Feltl & Company

With regards to GovDelivery, at least you noted the new all state agency deal. Should we expect more large sizeable deals like that out of GovDelivery or will it continue to be individual agencies do you think?

Walter Buckley

A couple of things. First of all, not only do they sign a complete state from an agency standpoint, they also signed a top 10 city, and they signed really through a federal agency, a platform offering where that agency is tying into 17 separate state agencies, where you’ll really be getting to see federal and state communications in a way that we have not seen before. So, I would expect to see continued large major transactions, as well as single agencies. So, it's a combination. But I think those three transactions from our standpoint are significant milestones for the company. We had not seen those before.

Scott Berg - Feltl & Company

And then, I guess my last question is on the revenue decline in the equity method companies. You didn't really talk much about Freeborders or White Fence. And it looks like Channel had another strong month or strong quarter. Metastorm keeps kind of bouncing around in the same $17.5 million range. Was there a particular weakness in one of the other two or three or is it just kind of general across board weakness on the other three companies?

Kirk Morgan

It was just general weakness across the board though. As we think about it, what we are most encouraged about was, and we’ve begin to see this in really Q4, but Q1 and this quarter. So the sales activity from a pipeline standpoint, especially Freeborders and StarCite, White Fence is a little bit more transaction oriented. It really accelerated in Q2, but StarCite you had an 82% pickup and RFP activity, increase in registrations and the general meeting activity, and that won’t translate into revenues probably into Q4. Freeborders, again, we think that they will begin to see growth in the later part of this year and into 2011. So, it was general weakness across the board, but I think from our standpoint we are beginning to see some of the investments begin to payoff.

Scott Berg - Feltl & Company

One more real quick with regards to Metastorm. It's kind of been bouncing around like you have mentioned in that $17.5 million range. How does the company accelerate growth over the next four quarters?

Kirk Morgan

Good question. The management team led by Bob Farrell and the board made its decisions late in Q4 to invest aggressively in the sales and marketing in the technology front. We've had a significant number of sales resources to the company in the first half of this year. And as we all know, it takes time to get sales folks up and running and we are bearing the expense right now about investment, both on the sales and marketing front, as well as the technology front. And you have to see the results. That said we go into Q3 with more deferred software than we’ve ever had historically, up 650% from Q1 going into Q2, and our sales pipeline is up as well. So, I think the trends are heading in the right direction and frankly then the proof will be in pudding based on Q3 performance. So, I think that's really the way we breakout.


And you have your next question from the line of Sasa Zorovic from Janney. Please proceed.

Sasa Zorovic - Janney Montgomery Scott

So my question would be regarding sort of a further acquisitions or investments that you would be looking to make. I really didn't get much in terms of commentary on that in the prepared remarks or did I miss that?

Kirk Morgan

Sasa, you didn't miss it. Obviously, the major investment for us year-to-date has been the 17% increase in our ownership on ICG Commerce which we’re excited about for a whole host of reasons. But as we look at our investments, opportunities really across this spectrum, I think that's for the three categories.

One would be, looking at our existing companies in the core equity group and evaluating the opportunity to increase our ownership stake in one or more of those companies, that's priority number one. I think obviously then looking at tuck-in acquisition for our existing companies and we are working closely with a number of those, and finally new platform opportunities.

And again, I didn't touch briefly on it. I think that our marketing team is doing a terrific job identifying some very interesting candidates. A number of businesses that we think have ability to really change their respective industry and create significant value. So, I think we are actively looking across all three of those and it's not always in our control, but we expect to see continued activity in the second half of this year.

Sasa Zorovic - Janney Montgomery Scott

No specific sort of indication that you can give us in terms of one or two deal by the end of the year or anything like that?

Kirk Morgan

Again, it's not completely in our control and we want to remain disciplined in our approach. But I would be surprised if we didn't conclude an acquisition, either for one of our existing companies or a new platform this year.


And you have your next question from the line of Saurabh Paranjape from Craig-Hallum. Please proceed.

Jeff Van Rhee - Craig-Hallum Capital

A couple of questions. First of all, particularly as it relates to the annual guidance, the revenue and EBITDA ranges, the EBITDA, it looks like a very, very steep ramp in the back half of the year. Apologies if I missed it, but gets us there, where does that really big Q3-Q4 bump in EBITDA come from?

Walter Buckley

To highlight on the call, the first half as I think about it, is really closer to $6 million than the $4 million due to some ramping up of expenses at ICG Commerce that were in the plan, but were in the plan later in the year, as well as some expenses on the accrual side for payroll that will simply reverse in the second half. So I think of the first half as being closer to $6 million. And with the strong pipeline that we have at ICG Commerce right now, I think, it gives some forecast and out to the second half of the year that makes me more comfortable that EBITDA is going to return. The EBITDA margin is going to increase there.

Jeff Van Rhee - Craig-Hallum Capital

Two other questions while you are on ICG Commerce there. You mentioned a couple of signings in the quarter or actually post quarter. But can you give us sense of the magnitude of the spend those deals bring because you can have wide swing with respect to how much spend each brings. And then also, just in terms of the pipeline, are you starting to see some maybe I would call some of the mega brands working through the pipeline now that ICG Commerce has clearly gotten some very recognizable referenceable success?

Kirk Morgan

Jeff, we’ll sort to break that into two. I think, first, we had three contracts, I mean I will give some color on them that we would love to have seen close in Q2, but I didn't and one of those did close, and have closed in the last week. And all three are multi-year multi million dollar contracts. The second is in very final negotiations, contract negotiations, and that's a very large contract from our perspective, and the third, in the next several weeks’ perspective. So, from an overall contract side, I would say two are sort of in the mid range and one is in the high end.

Jeff Van Rhee - Craig-Hallum Capital

And when you say multi-year multi million dollars, you are talking multi million per year or multi million spread over the typical three to five year contract length?

Kirk Morgan

Two would be multi million per year and one would be over the contract side.


And you have your next question from the line of Ben Atkinson from Gagnon Securities. Please proceed.

Neil Gagnon - Gagnon Securities

Hi, it's Neil Gagnon, Ben and the rest of the crowd here. Good morning. Could you discuss with us the milestones that we should be looking for, for the second half of this year?

Kirk Morgan

I think the key milestones would be to continue to see our partner companies or our consolidated core companies achieve our revenue and EBITDA guidance. I think that's really job number one and I think we’ll feel comfortable that they will make those EBITDA and revenue numbers. And point number two, we would like to continue our focus on acquiring larger stakes, consolidating stakes in our adjusting companies. Again, that's not in totally in our control but something we continuing to evaluate. And third, we’d like to close a new acquisition either from a new platform standpoint or a good tuck-in acquisition for one of our existing companies.

Neil Gagnon - Gagnon Securities

On the people that have been added across various companies, we get the sense that either this is more muscles in sales and marketing or are there people that will help you execute better to deliver the services that you will with bigger and more business. Is that accurate?

Walter Buckley

It's a good question. I would say the majority of the resources we added, especially if you look at ICG Commerce, Tom Bornemann, Investor Force with Jim Satloff, Steve Johnson at GovDelivery, those were primarily on the sales and marketing front, and I would say caliber of talent we are adding to all three of those companies is significant. And it’s already had an impact on those businesses. On the technology side, we did hire Amit at Investor Force to be the CIO, and he has been on board for three plus months and obviously that’s to continue to build out the platform and correspondingly the new product offering. So, it's probably three quarters on the sale side and one on the execution side.


And I show that you don't have no more questions at this time. So I would like to turn it back to Mr. Buckley, for closing remarks.

Walter Buckley

I would just like to thank all of you for joining us this morning and look forward to reporting Q3 results this fall. Thank you.


Ladies and gentlemen, that concludes the presentation. Thank you for your participation in today's conference. You may now disconnect. Have a great day.

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