E-Info opens up records to clients for a fee as revenues reach millions

BOULDER — It’s a rarity in these troubled times for companies conducting business on the Internet to claim 500 percent growth in revenues.

But information access firm E-InfoData.com Inc., which uses the Internet for as much as 99 percent of its business, did just that in 2000, says Lee Sands, founder and president.

Revenues grew from less than $1 million in 1999 to between $2 million and $4 million in 2000, Sands says, declining to give exact figures for the privately held company. Along with the growth in cash came more workers. The company employed about seven or eight people in 1999, says Don Knox, director of business development, and currently employs nearly 40.

Not bad for a couple of former reporters.

Sands founded the firm in 1994 after working as a reporter, including time at the Denver Business Journal, and Knox, a former business editor at The Denver Post and the Rocky Mountain News, joined last year. Sands started out selling data on CD-ROMs to companies such as media outlets and law enforcement agencies.

The company ditched CD-ROM in favor of the lucrative Internet medium in 1998. Previous to 1999, the company had grown at a 50 percent per year rate ? hearty for a new business. In 1999, a 400 percent growth rate. In 2000, a 500 percent growth rate. And Sands expects that type of growth this year and possibly next. Afterwards, he says, maybe 200 percent.

Sands is careful to note that his is not an Internet company, but an information company using the Internet as a business tool. “It’s like a courier company calling itself an automotive company,” Sands says. “They use cars, but they aren’t car companies.”

E-InfoData uses the Internet to provide access ? for a fee ? to public records databases. Prior to November, the company sold access strictly outside the public marketplace to law enforcement, media outlets, private investigators, collection agencies and others who make their living as “good guys chasing bad guys,” Sands says. The company does not sell to marketing agencies.

In November, CoCourts debuted. The public could now access real-time court records online.

“Parents can now check out a babysitter or roofing contractor to see what kind of business they’re dealing with,” Sands says, adding that citizens still must visit the courthouse for complete records and that no locating information such as addresses are used on CoCourts.

E-InfoData built the service for free to the Colorado State Judicial branch, which commissioned the system.

CoCourts solved a problem of sometimes inaccurate and outdated court records, as well as some records being released and lost, says Linda Bowers, public access manager for the State Judicial. The State Judicial began working on policy in 1998 that would allow online public access while also protecting the privacy of people in the records, she says. The system also had to be built free of charge to the State Judicial, Bowers says, because the Colorado Legislature did not appropriate funding for it.

E-InfoData incurred about $700,000 in costs to give citizens real-time access to court records for a small fee. The costs are still mounting but the public is responding, using the system primarily on weekends, Sands says. It was an entrepreneurial project, more than routine, which is why his company jumped at the October 1999 request for proposals.

“We got no money for it,” Sands says, adding that the company must provide the information to other resellers and free to state agencies. The key to CoCourts’ success will be reaching consumers, something Sands calls a difficult task. The company has run ads in the newspaper and sent out press releases and held press conferences. E-InfoData will soon be running radio ads and teaming up with the Better Business Bureau to help link consumers to the system.

E-InfoData has found it valuable to contract out its expertise in how public records are found and can legally be used. It handles modest to huge projects, such as building access to outstanding felony warrants in Colorado in conjunction with KUSA-TV Channel 9, to a current project involving access to information from all 50 states for pre-employment screening for a group of clients. The latter niche is expanding, with pre-employment screening becoming increasingly commonplace, especially in fields such as health care, professional driving and child care, Sands says.

“Pre-employment screening needs to be done to protect the public,” he says, giving the following example. “You don’t want a trucker on the road who has numerous DUIs.”

E-InfoData does not help people build information systems, Sands says. Companies do that on their own. E-InfoData helps people streamline data into useful information in one format. Cost for the service is figured on a case-by-case basis.

“We know how to market. We know how to make money,” Sands says, adding that good money management skills also helped grow the company. It started with a few thousand in friends-and-family money, and later was bolstered by a handful of investors, including Shoreline Asset Management, a Boulder financial services firm that shares the office at 1033 Walnut St.

Of the current shakeout in Internet-based companies, Sands says a lot of it is the result of a market that over-inflated Internet companies’ values. Also, “there were some smart people out there. With the frenzy, a lot of companies out there made some bad decisions,” he says, adding that he foresees a resurgence in Internet-based companies ? only next time with realism penciled firmly into their business plans.

For now, the shakeout provides one good thing for E-InfoData ? plenty of good workers from which to choose.

For information: (303) 832-1327 or www.CoCourts.com or www.einfodata.com.

Contact Alisha Jeter Rhines at (303) 440-4950 or research@bcbr.com.

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