Smarsh eyes acquisition of Digital Reasoning

Smarsh, enabling organizations to manage risk and uncover value within their electronic communications, is acquiring Digital Reasoning, bringing together the leadership of Smarsh in digital communications content capture, archiving, supervision and e-discovery, with Digital Reasoning's leadership in advanced AI/ML powered analytics.

The combined company will enable customers to spot risks before they happen, maximize the scalability of supervision teams, and uncover strategic insights from large volumes of data in real-time.

"Smarsh and Digital Reasoning's combined capabilities equip customers with an entirely new expertise that we are calling 'Communications Intelligence.' Using artificial intelligence and machine learning helps firms more efficiently supervise and mitigate risk at scale, and will now enable them to analyze their electronic communications to uncover business intelligence that can fuel sales and other revenue drivers,” said Brian Cramer, CEO of Smarsh.

The combined capabilities of Smarsh and Digital Reasoning enable customers to:

• Strengthen lexicon-driven supervision with AI-powered surveillance across the widest breadth of digital communications channels
• Automate surveillance across the emerging collaboration tools (such as Microsoft Teams, Zoom, Slack, and Workplace by Facebook) that are critical for productivity in the COVID-era remote workforce reality
• Reduce costs of human capital, by minimizing the amount of communications people must review
• Accelerate the ability to leverage massive amounts of data for insights that can drive business growth
• Identify troublesome patterns or trends of employee behavior before they cause irreparable harm

Together, Smarsh and Digital Reasoning can enable global customers to get ahead of unwanted or illegal activities such as fraud, insider trading, money laundering, customer complaints, and other top priorities.

The enhanced platform will be especially adept at satisfying requirements from financial services regulators in the United States and overseas, including the Securities and Exchange Commission (SEC), the Financial Industry Regulatory Authority (FINRA), and the U.K.'s Financial Conduct Authority (FCA).

The addition of Digital Reasoning to the Smarsh organization follows the acquisition by Smarsh of Entreda, the leading cybersecurity compliance solutions provider for the wealth management space, in May of this year.

Financial details of the transaction, which is expected to close in the next 60 days, were not disclosed. Barclays acted as exclusive financial advisor to Digital Reasoning.

Smarsh manages over 3 billion messages daily across email, social media, mobile/text messaging, instant messaging and collaboration, web, and voice channels.

The company has expertise in serving global financial institutions and US-based wealth management firms across both the broker-dealer and registered investment adviser (RIA) segments.

"In this new world of remote work, a company's digital communications infrastructure is now the most essential one for it to function and thrive. Smarsh and Digital Reasoning provide the only validated and complete solution for companies to understand what is being said in any digital channel and in any language,” said Tim Estes, founder and CEO of Digital Reasoning. “This enables them to quickly identify things like fraud, racism, discrimination, sexual harassment, and other misconduct that can create substantial compliance risk."

For more information about this news, visit www.smarsh.com or www.digitalreasoning.com.