Knox Lane investment fuels SAGE growth

KENT, Ohio—Knox Lane's acquisition of a majority stake in SAGE Integration is expected to accelerate the company's growth strategy through a combination of acquisitions, technology investments and expansion within critical infrastructure markets. 

According to Eric Frasier, CEO of SAGE Integration, the transaction developed organically rather than through a formal sale process. The company had not been actively seeking a buyer, but Knox Lane's interest in the security integration market and its existing relationship with Sier Capital Partners, SAGE's previous majority owner, helped bring the deal together. 

"We weren't actively shopping SAGE," Frasier said. "We're kind of growing so fast, we're just focused on SAGE's growth." 

Frasier said Knox Lane's growth-focused approach and operational resources made the firm an attractive partner. 

"They have an AI specialist, finance people, inside counsel, and a lot of in-house resources," he said. "Everybody's hard-working, but they're quality individuals who want to align with you and turbocharge SAGE for growth." 

Growth plans center on M&A 

The investment comes as SAGE expands nationally and pursues an aggressive acquisition strategy. 

"We'll be amplifying both the M&A and organic sides of our business," Frasier said. 

John Nemerofsky, COO of SAGE Integration, said the company hired more than 100 employees this year but continues to face labor challenges common throughout the industry. 

"We can't hire fast enough to support our national and global clients," Nemerofsky said. "With this added acquisition strategy, we'll be able to fulfill our clients' needs more quickly and more efficiently." 

Executives said customers and employees should see little disruption from the ownership change. 

"There are no synergies, it's the opposite," Frasier said. "It's just grow, grow, grow." 

Data centers, AI drive demand 

SAGE leaders said demand remains strong across several areas of the enterprise security market, particularly data centers, utilities, workforce safety initiatives and cloud-based security deployments. 

"We see incredible growth in critical infrastructure, especially in the data center market," Nemerofsky said. "In corporate campuses, employee safety remains the No. 1 challenge." 

The company's embedded-services model, which places trained personnel within customer operations, continues to be a key differentiator, according to Frasier. 

"When you are embedded into a customer's footprint, you're an extension of them," he said. "You're strategically aligned." 

SAGE also sees growing customer interest in artificial intelligence. Nemerofsky said organizations are evaluating AI for applications ranging from weapons detection and alarm reduction to visitor management and incident response. 

"Everybody's looking for AI to solve problems instead of adding additional staff," he said. 

Culture remains a priority 

While acquisitions are expected to play a major role in SAGE's future, Frasier said cultural alignment will remain the company's top priority when evaluating potential targets. 

"Our employees are the tip of the spear," he said. "If we don't feel like it's a cultural fit, we will not risk damaging our culture in any way." 

Nemerofsky summarized the company's M&A philosophy simply: "There's culture and math. If we can't get the culture right, we don't even bother with the math." 

Although Sier Capital Partners retained a minority stake in the business, Knox Lane now serves as SAGE's primary investment partner. Frasier said the goal is to build on the strong growth the company has already achieved. 

"They bought us for a reason," Frasier said. "They like SAGE, they like the platform. Let's continue to grow our enterprise-level customers and our embedded staff. Let's continue to grow in a thoughtful way, but let's do a lot more of it." 

Related: SAGE Integration acquires Vital Installs, sudoVision