Appriss Retail spends lots of time protecting clients from retail crime and fraud, but on Wednesday, it was the one getting snatched up.
The Irvine, Calif.-based loss prevention software provider announced it has been acquired by Westport, Conn.-based private equity firm Gemspring Capital Management. Appriss uses artificial intelligence and a variety of other technologies to help retailers prevent return fraud, track instances of in-store crime and more.
Michael Osborne, Appriss’ CEO, declined to disclose financial details about the transaction.
Osborne noted that Appriss will retain its name and its entire workforce despite the acquisition. The company was previously backed by Clearlake Capital Group and Insight Partners.
Osborne said he believes Gemspring approached Clearlake and Insight about the transaction because the firm shared a similar vision for the future of retail to Appriss.
“They clearly see, the way we do, the market evolving and needing more and more AI-based technology to counteract the progression of fraud and abuse in the systems of retailers, especially apparel and other hard goods,” he told Sourcing Journal. “When you look at a number of factors, like the overall growth rate of retail, the expected continued growth rate of retail and the continued progression of the abuse and fraud side of it…the solution we offer is a no-brainer.”
And, for Osborne’s part, he said Appriss sought alignment around the company’s growth path and strategy, which Gemspring has proven agreeable to. One of Gemspring’s managing directors, which Appriss has worked with extensively during the transaction, previously worked in software and technology, which Osborne said is a strong complement to the firm’s at-large expertise in the space and has increased his excitement around the transaction.
“This new group of investors is now my board, and I report to them, so I’m very interested in what they bring to the table, beyond just the checkbook. Gemspring really did that,” he said. “I’m really excited about being able to work with them going forward.”
Osborne said Gemspring has invested in a number of technology companies across a slew of industries, which he believes could jumpstart new ideas inside of Appriss.
“One aspect that I like about [Gemspring] so much, is that they do have a breadth of investments across other industries and across other areas of focus that allow us to then draw comparisons and learn from,” he said. “We want to learn from folks that have gone through similar problems to ours, but then also [who have devised] different answers to similar problems.”
While Appriss already has a multiyear roadmap aimed at growing inside the markets it serves, Osborne said unlocking this partnership with Gemspring may allow it to invest further in other strategic priorities that aren’t yet on its radar.
“There’s a lot of opportunity for what we do today, and a lot of room for us to improve internally, as well as externally, with what we deliver for our customers,” he said. “We’re excited about that growth and any of those additions.”
Osborne did not disclose specifics about new products or future plans with Gemspring at the helm, but did note that retail continues to have sweeping issues with retail crime, fraud and theft that Appriss will continue to leverage technology to solve for.
“While AI is a phenomenal buzzword and will immediately get you a lot of attention, you still have to do something that delivers value, and someone has to want to pay for that value for you to have a business that is a profitable one,” he said. “We’re excited about the fact that we’re bringing some reality to what is often a lot of buzz.”
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