Private equity firm Silver Lake Sumeru has acquired i2 Technologies for $185 million from ChoicePoint.
i2 provides visualization software used by law enforcement and the intelligence community for mapping investigations. The company got a lot of attention following 9/11. They used a visual map showing relationships between members of al-qaeda and various events leading up to the eventual attacks on 9/11.
It's been a few years since I've looked closely at i2, but what always surprised me was that there seemed to be a lot more hype than substance in the product. The product was positioned as an analysis tool, suggesting that it would help uncover various social networks and relationships in data, but when I frequently met with i2 users, I found that it was used more as a presentation tool. Investigators would use i2 not in conducting analysis, but in order to present the analysis once it was complete. One large group of cross-jurisdictional law enforcement officers I met with indicated that half their group used i2 while the other half preferred graphics app Visio.
The $185 million price tag seems high to me for a fancy graphics app. While they have done a good job in penetrating law enforcement, I don't see much opportunity beyond their core market. Choicepoint acquired i2 in late 2004 for approximately $100 million. While the company does not report revenues by product, in its last year as a standalone company (2004), i2 reported revenue of $28 million.
Comments