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Entrepreneur discovers a lucrative niche

From his new office window on Andrews Street, John Holland has a clear view of the Alliance Building on East Main Street. He spent 80 to 100 hours a week there in the 1990s, nurturing a startup called DocuLegal that scanned and loaded paper documents into databases for law firms and corporate legal departments.
 
Some nights he slept on the office floor.
 
"We didn’t have the staff, and we had the work coming in," says Holland, 42, now CEO of D4 LLC, a provider of litigation support, computer forensics and electronic-discovery services. "So we got hit with these peaks and valleys, (and) the only way to handle the peaks was to do it yourself and do it around the clock."
 
With his mother-a former nurse-as the startup’s office manager, Holland began showing the legal industry how technology could provide an alternative to law firms’ discovery "war rooms," where reams of paper documents awaited manual review.
 
"I knew there had to be a better way," Holland says.
 
Now known as D4 after a merger, partnership and rebranding, the company has made significant strides. Though he declines to discuss details of financial results, Holland says the operation grew more than 45 percent last year.
 
"We are already on target for a record year this year," he says.
 
D4 ranked No. 15 on the Rochester Top 100 list of fastest-growing privately held companies in 2011. Inc. magazine ranked the company No. 3,261 on its list of the 5,000 fastest-growing firms in the United States last year.
 
D4 has 125 employees, 60 of whom work in Rochester. It operates nine full-service offices nationally and recently acquired a document imaging and e-discovery firm in Detroit.
 
Last year the company invested $1.6 million in renovating a former necktie factory on Andrews Street as its headquarters and installing a high-security Tier 3 data center.
 
Concerned that D4 employees would have few dining options in the St. Paul Quarter, Holland and a partner recently opened Roc River Coffee Co. in the Kirstein Building, next door to the company’s headquarters. The cafe and deli is open to the public and has begun attracting a neighborhood following, Holland says.
 
What has changed most internally at D4 in recent years is the volume of data it handles for clients. Services for electronic discovery-the process of identifying, preserving, reviewing and producing electronically stored information in the context of the legal process-are among the company’s core offerings.
 
"Data sizes are exploding, and managing larger data sets is a challenge," Holland says. "We are now in the realm of petabytes and not just gigabytes and terabytes anymore."

Finding a path
After graduating from Providence College in Rhode Island in 1992, Holland worked briefly for Xerox Corp. and then spent four years in New York City at NightRider, a startup division of the office equipment and paper firm Alco Standard Corp. As a sales manager, he helped open new offices for the company in Manhattan and enjoyed the bustle of big-city life.
 
Yet by the mid-1990s, Holland began feeling the pull of entrepreneurship. After seeing that NightRider’s legal industry clients were not using technology to make discovery easier, he began planning how to fill that niche.
 
Through his own research, Holland determined that Rochester had enough law firms and corporations that would benefit from the services he had on the drawing board. He moved back in with his parents in Rochester and recruited his brother, then a Xerox employee, as a partner in DocuLegal.
 
Seed money from friends and family got the startup through its first six months.
 
So did gut instinct.
 
"I think it’s a big part of being an entrepreneur," he says.
 
Adds Holland: "I am not afraid of failure. You can’t be. If you are, or if you think about it too often, it will most likely never work."
 
Within three years of its launch in 1997, DocuLegal opened offices in Buffalo and Syracuse. The Syracuse office did not last the year.
 
"It was going well but too fast," Holland says.
 
Other moves the company made paid off immediately.
 
"Meeting my current partner, Peter Coons, and starting the forensic lab and data collection team in 2005 was pivotal," Holland says.
 
"It was a risky move, but I believed at the time that we needed to be ahead of the curve and differentiate ourselves as data experts and not just experts with paper scanning and automation," he says. "That was really the start of the present-day D4."
 
D4 attracted many suitors in the ensuing years, including North Carolina-based Ivize LLC, which acquired D4 in 2008. But Ivize hit the skids within six months of the sale, prompting Holland and his team to set a plan in motion to reacquire the company.
 
"The deal to take possession of D4 was done in the 11th hour, and we were able to take control of the company and its employees and start over the next morning," he says.
 
The experience amounted to a priceless learning opportunity.
 
"I think I acquired the skills to run a litigation support and e-discovery business through going through the school of hard knocks," Holland says. "Tough experiences and an upbringing where my father always pushed me to be a better person and to do my best didn’t hurt."

Husband, father, friend
Though his professional life involves high technology, Holland relies on outdoor activities to decompress. He recently cycled 100 miles in the annual Ride for Missing Children and enjoys hiking in the Adirondacks, competing in triathlons, boating on Canandaigua Lake and golfing at the Country Club of Rochester, where he is a member.
 
At home in Pittsford, Holland cherishes time spent with his wife, Susan, their four children, two English bulldogs and one Chihuahua-poodle mix. The kitchen is especially lively when the family gathers once a week to make pizza.
 
James Holahan, member of the labor law and employment law practice at Bond Schoeneck & King PLLC in Rochester, believes he first met Holland in the 1990s. The two men got to know each other better when Holahan opened a solo practice and needed litigation and technology support.
 
"He has the ability to make you feel like a longtime friend in just a few minutes," says Holahan, whose firm is a D4 client.
 
Holland knows how to handle chaos, the attorney adds.
 
"He’s a never-retreat person as well," Holahan says.
 
David DeJoy, managing partner at the Rochester-based accounting firm DeJoy, Knauf & Blood LLP, says Holland is a good listener and does not shy away from challenging ideas or opinions respectfully.
 
"He’s an extremely creative guy," says DeJoy, Holland’s personal accountant, friend and occasional golf companion.
 
Holland also has a nose for talent.
 
"He’s surrounded himself (at the company) with fantastic people along the way," says DeJoy, whose firm handles D4’s accounting. "He works extremely hard."

Growth plans
Growth through acquisition and building a national sales team figure prominently in D4’s plans.

"We have done a great job with marketing in the last year, and we plan on investing in that and enhancing our online presence, which has worked very well for us over the last year," Holland says.
 
Over the past few months, the company has bolstered its management team, hiring John Rubens as chief operating officer, Cynthia Courtney as vice president of discovery engineering and Joseph Reges as vice president of sales for the western region.
 
New offerings at the company include eNtrust, a managed-service solution for litigation support that is available at a fixed cost and by subscription. Holland says it has become the company’s fastest-growing service.
 
"Our unique approach to the market is that we serve everyone," Holland says, "even from inception. I mean we would deal with solo practitioners all the way up to the top law firms."
 
As technology changes, so must D4.
 
"We’re doing collections and extractions on iPhones now and iPads more than we ever have because there are so relevant in business, and there’s data on those devices that’s relevant to litigation," Holland says.
 
When entrepreneurs ask Holland for advice, he has a succinct message: Believe in what you are doing and look ahead.
 
"I think that’s part of being an entrepreneur, (asking) … ‘What’s the next phase and what’s the next stage of success?’"
 
Sheila Livadas is a Rochester-area freelance writer.

John Holland
Position: CEO, D4 LLC
Age: 42
Education: B.S. in marketing, Providence College, Providence, R.I., 1992
Family: Wife, Susan; children Sydney, 9, twins Hope and Jake, 6, and Alice, 20 months
Residence: Pittsford
Activities: Golfing, skiing, hiking, boating, scuba diving, competing in triathlons
Quote: "I am not afraid of failure. You can’t be."

5/18/12 (c) 2012 Rochester Business Journal. To obtain permission to reprint this article, call 585-546-8303 or email rbj@rbj.net.

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