Lightyear Capital LLC (Lightyear), a New York-based private equity firm focused on financial services, announced that investment funds affiliated with Lightyear have established ProfitSolv to acquire integrated billing, payments, and software solutions for legal, accounting, and other professional services firms including consulting, architecture, and engineering firms. ProfitSolv has made three acquisitions to date:

• Rocket Matter, a leading cloud-based legal billing, practice management, and payment processing software business;
• TimeSolv, a provider of cloud-based software for legal billing and timekeeping; and
• ImagineTime, a practice management and payments company serving accounting and other professional services firms.

Investment funds affiliated with Lightyear are the Company’s lead investor, and Greater Sum Ventures (“GSV”) holds a significant minority stake. The Company will seek to execute strategic acquisitions that will help expand its footprint within the professional services software and payments solutions industry, a highly fragmented market with a large number of small providers. Lightyear estimates the total addressable market for these solutions is approximately $1.4 billion in the legal vertical alone.

Kelley Castell has been appointed Chief Executive Officer of ProfitSolv. Mr. Castell joins ProfitSolv after having served in a variety of senior leadership roles at fintech and payments companies including Bluefin Payment Systems, Oasis Outsourcing, and First Data. “I am excited to be working with the experienced teams from Lightyear and GSV to build on ProfitSolv’s strong customer- and product-oriented strategy, achieve strong organic growth, and expand the business through acquisitions,” said Mr. Castell.

“Our investment in ProfitSolv reflects our long-term investment thesis that embedding payment solutions in vertically integrated, sector-specific software will continue to gain market share from more traditional software providers,” said Mark F. Vassallo, Managing Partner of Lightyear. “We believe that solutions which integrate and automate billing, invoicing, and electronic payments will deliver stronger, more efficient receivables management, particularly since most small businesses still process paper checks.”

Lightyear’s affiliated investment funds have successfully invested in embedded and vertically integrated payments companies, including realized investments in HigherOne, which serves higher education institutions, and Alegeus, which manages consumer-directed healthcare payments, and a current investment in Therapy Brands, which serves behavioral and mental health professionals. In addition, Lightyear has accumulated considerable expertise in building companies through mergers and acquisitions with over 90 acquisitions made through its affiliated funds’ portfolio companies since 2000.