Tyler Exec: Sage Deal Will Make Us Stronger Around Threat Monitoring, Security Consulting

Tyler Technologies' purchase of Sage Data Security should give clients a leg up around security education, real-time threat monitoring, and post-breach consultation services.

The acquisition, announced Tuesday, follows a five-year courtship, and will bring the robust security offerings of Sage to the 15,000 public sector clients that Tyler has across the country, according to Christopher P. Hepburn. president of Tyler's ERP and School Division.

"We can now marry their expertise with our client base," Hepburn told CRN.

[Related: Tyler Technologies Continues Channel M&A Madness With Acquisition of Sage Data Security]

Sage has historically been focused on protecting digital infrastructure in the finance and health care verticals, according to Rick Simonds, president and chief operating officer at Sage. Becoming part of Tyler should enable Sage to move beyond finance and health care and also protect the public sector as well.

With clients in schools, courthouses, and municipal government in all 50 states, as well as in Canada and Australia, Tyler Technologies said it is buying Sage in order to anticipate their customers' needs.

"The acquisition of Sage is really more holistic for the client. Think of every town, city, county or school as a business. That business has an entire infrastructure or network that many applications are running on," Hepburn said. "I'm sure some of our clients are out ahead of total cyber security and I'm sure we have a percentage of clients who are lagging behind."

Tyler, No. 44 on the CRN SP500, bought Sage on Tuesday with existing cash balances nbsp;for an undisclosed sum. Hepburn said there is always a discussion about whether Tyler can create the product a client needs on its own or if it is better off acquiring the capabilities from elsewhere.

"Tyler is always looking to expand our offerings and as such we're looking at build versus buy. Should we build organically, and create the skill set and product, or is there an industry leader that we feel would work well joining the Tyler portfolio, and Sage was the latter," Hepburn said.

Hepburn added that it wouldn't have been prudent for Tyler to build these security capabilities on their own, especially given the work that Sage had done with clients facing stringent regulations such as hospitals and financial institutions. Simonds said in the five years they've worked together, Tyler has impressed them with understanding what their clients need.

"Tyler is visionary. They know that the public sector is vulnerable to breaches. We've seen that in the city of Atlanta this month. They'll be able to offer their clients security services to help them." he said. "We gain access to resources that we don't currently have. It just brings us to the whole next level. It's a great opportunity."
And as more of Tyler's government clients tip-toe into the cloud, Simonds said Sage will be there to help them navigate the pitfalls.

"I believe one of the things we do as advisers, is anyone who is looking at the cloud, we can present them with the pros and the cons and the risk," he said. "Most security is understanding how much risk can you tolerate."

Tyler boasts 4,000 employees nationwide. It employs 700 people in Maine at sites in Falmouth, Yarmouth, and Bangor. The company anticipates folding the 45 Sage employees into one of those existing facilities.