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In 2011, VendEngine started as a simple concept — digitizing financial transactions for law enforcement, jails and prisons while providing easy, safe, and secure methods to transmit money between family members and inmates. Once the company got going however, this simple concept, something that had been done in nearly every other economic sector, except law enforcement, turned into one of the top 300 fastest growing companies in North America by 2019 according to Deloitte and Touche.

VendEngine Team.

The idea came along when serial entrepreneur Silas Deane was listening to National Public Radio about a family dealing with the impacts of incarceration – the loneliness, the separation, the lack of communication between the father, his kids and wife, while serving his time – what struck Deane and some of his family and colleagues the most though were the predatory fees and lack of clarity around money that was supposed to be coming in for the father to use for toiletries, clothing and commissary while incarcerated. “The system was a mess — there was simply very little clarity around money inside these facilities, where was the money going, inmates extorting each other with cash in their pockets, officers that could be less than ethical – cash and jails don’t mix well. We found most wanted to do it right, but it was just a scenario that was ripe for problems while many inside the jail and their families don’t operate with much voice or choice in the matter,” said Deane.

Silas Deane, President and CEO, VendEngine

So, Deane, a serial entrepreneur and some industrious colleagues set off to create one of the first digital currency systems specifically designed for the law enforcement and corrections world — founding VendEngine as a side gig and a passion to solve a complex problem. Once built, the cloud-based concept quickly found immediate success in one of the most unexpected places – rural county jail facilities across Tennessee. These facilities and their suppliers loved the idea of providing cash-less (digital) access to families that had a hard time making it to the jail to deposit funds. The opportunities to use the VendEngine website, the CorrectPay app, the 1-800-live person call center and even kiosks at the local grocery store, quickly became the avenue of choice for family members to provide immediate funds to their loved ones for a small $2 convenience fee. Law enforcement professionals quickly found they loved it as well – they could provide more secure access to providing ways to fund an inmates journey, have a clean money trail that stopped grift and money laundering inside jails while also doubling/ tripling their commissary store sales — profits of which typically go to provide additional educational and training programs inside the jails and to their staff.

The concept was a win-win-win, and the word spread fast. Before long VendEngine was in over 60% of the county facilities across TN, KY, AL and growing quickly — all with no investors, no marketing budget and having never hiring a single sales-person. Interestingly, in these early days despite the healthy growth and strong recurring revenue, the management team was having no luck finding any potential investors and even had to pay top rates to find a credit card processor to even transact a card and a bank that would even bank them. The concept was just too novel – “high risk profiles”, working with corrections, inmates and a highly unbanked group of customers –VendEngine was truly pioneering a new field and that mix of customers just did not fit the traditional financing profiles. As a result, Deane and the team decided to just self-fund it, manage the company through hard-earned sweat equity and good old-fashioned cash flow management — and boy, did that ever pay off.

Tyler Technology executives break ground on new manufacturing facility in Kingston Springs, TN – November 2022.

As the company continued to double and triple growth year after year, VendEngine quickly found solid financial footing and evolved beyond simply providing digital transactions, evolving into a full-blown accounting system, a communications platform and even a hardware system for these facilities and more. “For many of these facilities, we became a part of their IT team, we would brainstorm ideas with them, lock ourselves in with the inmates, connect with the inmates families — before we knew it our system was providing multiple services to the facilities.”” said Deane. “VendEngine was a system built by the officers, by the inmates and by the families. They gave us problems to solve, we listened and we had an awesome team that executed.” In 2018, the company even went out and bought a hardware manufacturing company, Harpeth Industries, so that they could provide hardened, specialized kiosks for the inmates to use to conduct their business.

VendEngine now offers multiple services to correctional facilities including full-blown video visitation, video chat services, electronic messaging, electronic monitoring, grievance management, point of sale system, digital currency vending machine integrations, suicide alert systems, education programming on tablet and handheld devices for inmates, entertainment options for inmates and even free access to legal law libraries, digital document signing and many, many more features.

In 2020, when Covid hit – inmates, officers and corrections agencies were among one of the hardest hit areas of the population. Jails that were not letting inmates out, were having to go into full lock-down mode with inmates and their staff and cutting off all on-site visits and communications with family members and loved ones. It was a scary and lonely time for officers, inmates and their families. However, that is when the benefits of a cloudbased system VendEngine had been evangelizing for many years now, REALLY took off. By having a no premise server, app-driven infrastructure where inmates and their families could spend time together across video chat, electronic messaging and other applications with the simple-use of their smart phone at home, the company saw a tremendous spike in growth and the realization of the cloud-based system became most obvious. That is when, the investors and the buyers came calling.

Sullivan Co, TN law enforcement professional using our software.

Before 2020 rolled around, Deane and the VendEngine team had begun a new effort to woo some investors again, deciding it was it was time to put the pedal to the metal and grow the market even larger. Already operating now in 15+ states and growing – still without a sales force — the team decided it was time to take off the gloves and seize the market. VendEngine had only scraped the surface so far with only about 15% of the TAM under contract. Unlike earlier though, there were plenty of suitors interested in the market that VendEngine had created in such a short time. With the company carrying no debt and pushing strong year over year revenue growth while pumping profit margins back into more growth the model had been proven.

VendEngine hardware team assembling kiosks for law enforcement agencies.

The VendEngine team took most of 2019 to meet with every single VC firm, partner or interested party who came calling. “I think I personally participated in no less than 50+ meetings in 2019, listening to their pitch, hearing why their firm was different, better or more connected than the others,” said Deane. “It was a blast. I think I got my second and third MBA during that experience.”. The process paid off.

By late 2020, after having so much interest and feeling overwhelmed, the team hired Brentwood Capital of Nashville, TN to put together the investment portfolio and “The Book” dubbing the opportunity as” Operation Klink”. Once ready, Brentwood Capital turned on the spigot and immediately secured a lot of interest in the company – so much, that they quickly began narrowing down the players to a handful of VC firms and others that had some expertise in the government payments space.

From Left to Right: Silas Deane, President and CEO; Kevin Burke, COO; Chris Sherrod, CIO; Rob Giermek, CTO

It was during this time that one of the company’s Account Representatives happened to be attending a trade show in Texas, when a representative from Tyler Technologies, an S&P 500 company well-known as one of the largest government IT companies in the world, approached the booth we were sharing with another company, wanting to learn more about our services. Tyler had already done their homework and knew all about VendEngine, but that conversation, led to a phone call, led to a meeting and then the question – “would you all be interested in being acquired?” and it was love at first sight. The rest is now history.

Tyler Technologies acquired VendEngine September 1, 2021 for $88 million, an amount the Nashville Business Journal heralded as the largest-ever technology acquisition in Nashville history. Deane still serves as the business unit’s General Manager with his full team still intact after the acquisition. In addition, Tyler most recently announced an expansion of the hardware and kiosk manufacturing capabilities by breaking ground on a new 18,000 square kiosk manufacturing facility in middle-Tennessee.

Now the software is a key part of Tyler’s Enterprise Corrections portfolio, serving over 350+ correctional facilities across the United States and the Caribbean and growing quickly.

A perfect match that all began with a single, simple vision.

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