Transformation and reinvention often happen when you come in contact with something bigger than yourself.

In Paul Doman's case, it was his partnership with a private equity firm that enabled him to purchase a company in which he saw a lot of potential.

Doman, a Cleveland mortgage title executive, started kicking the tires of sleepy mortgage processing company called Accurate Group, in Charlotte, North Carolina in 2008. He wanted to buy it, because he had big ideas for where he thought it could go.

But his first glimpse of the company's server room, more of a closet really, gave him pause. This is what he saw when he opened the door: A large blue plastic tarp was suspended like a tent from the ceiling. The tarp protected a set of blinking computer servers from water that trickled through the cracked ceiling whenever it rained. A small portable fan whirred away and oscillated, cooling the machine with the assistance of a portable air conditioner.

Sitting on the network was Accurate's most valuable asset, a powerful suite of mortgage-servicing software capable of managing thousands upon thousands of real estate transactions in seconds. Only 10 licenses existed, and one of the original programmers worked for Accurate.

"[I] recognized quickly that having tarps and air conditioners draining into the hall were not going to allow us to scale the business the way we needed to," Doman said.

The Right Leader at the Right Time

Doman spent 20 years working in banking and mortgage services and knew the business well. At First American Financial Corp., one of the largest mortgage-transaction services companies in the U.S., Doman had turned a sleepy home-equity unit into a $100 million enterprise with 500 employees, in just a few years.

Accurate seemed primed to grow, but it was stuck at an inflection point: Revenue was about $6 million, and its owner was fine with that, wanting to spend more time with his family and on his 50-foot yacht.

And though real-estate transaction services is also a highly fragmented market, amounting to about $17 billion in the U.S., Accurate, concentrated in just three states, had less than one percent of that. Doman knew the business could be much bigger, and he wanted to make it national. But that would require a lot of work, not to mention money. Paul O'Connnor, the company's then-owner, wanted to sell for $4 million. Doman needed some help with that, and so he enlisted the aid of private equity firm Evolution Capital, in Cleveland. Its two managing partners, Brendan Anderson and Jeffrey Kadlic, were always looking for diamonds in the rough.

"People are willing to invest in people with a plan, who are organized and who can articulate a strategy, and who demonstrate a passion for growing a business," Doman says.

After taking a hard look at Accurate's EBITDA--earnings before interest, taxes, depreciation, and amortization--and a proxy for the amount of cash generated by the company, Kadlic and Anderson saw it had $350,000. That was generally lower than what they sought. But Accurate also had a profit margin of about 10 percent, and the pair bet that sales growth could make up the shortfall.

In February 2009, they and Doman bought the company, with Doman in charge.

A New Beginning 

As a first order of business, Doman moved headquarters from Charlotte to Cleveland, to keep a close watch things.

Next it rescued Magellan, the crown jewel of the sale, from its precarious perch in Charlotte, where it sat on a server under the blue tarp. Doman located a hardened data center in Charlotte where it would be protected from hackers--not to mention rainstorms--and stuck it there.

During the first 12 months, Doman used cash flow to plough close to $1 million into salaries and overdue infrastructure upgrades that would allow the company to expand into other states.

Doman hired an eight-person management team that would help Accurate grow and scale, picking up talent from First American assigned to spots including chief information officer, president of valuations, and an executive in charge of business and strategy. Doman also hired two of Magellan's original programmers, expecting them to build out the license to accommodate his new national strategy.

The next step was to go out and selling the company's services like. Doman boosted the sales staff from one national representative to eight, and they went on an aggressive hunt for new business. They succeeded in bringing on some impressive regional clients within months. The first big win was Northwest Savings Bank, in Warren, Pennsylvania, which brought Accurate about $750,000 in annual revenue. In 2009, it also brought on First American as a customer, which also added hundreds of thousands of dollars more to revenue.

By the end of 2010, it had connected Magellan to three more regional bank customers, and EBITDA had crept up to $1.8 million. By 2011, with the wins of five more regional banks, EBITDA had jumped to nearly $3 million, or 10 times what it had been when the team bought Accurate Group. And by 2012, with new customers such as Royal Bank of Scotland and KeyBank, cash flow was closing in on $8 million.

Within 16 months, Accurate had reached the point where major private-equity investors would be interested in purchasing the company, according to investment experts. And in the summer of 2012, an even larger private-equity firm, ABS Capital based in Baltimore, purchased Accurate for $55 million of equity and an undisclosed amount of debt.

"We love it when it when companies are unique and differentiated and in a big enough market so the company could be four to five times its size in four or five years from when we invested," says Phil Clough, managing general partner at ABS Capital.

Not a bad windfall for three years of work, and with Doman still at the helm, the next stop is an even bigger company, with revenue of more than $200 million within the next five years, Doman hopes.

"ABS emerged as the right fit for us, and we're thrilled to be partnered with them," Doman says.