Vancouver startups valued at $1b dominate new entries to ‘Narwhal Club’

Sitting at the Cloud Factory tech conference in Banff last March, Brent Holliday recalls a pitch session veering toward talk of what Canadian startup is ...
Infographic courtesy of Visual Capitalist  and Garibaldi Capital Group 

Sitting at the Cloud Factory tech conference in Banff last March, Brent Holliday recalls a pitch session veering toward talk of what Canadian startup is poised to become the next “unicorn.”

The unicorn club refers to about 40 U.S.-based tech startups that managed to break through — and evoke the image of a unicorn’s horn — to be valued at US$1 billion or more since the “tech wreck” of 2003.

“I tweeted out instantly. I said, ‘Forget unicorn. Let’s make it something more Canadian. How about narwhal?’ And it just kind of stuck,” said Holliday, CEO of Garibaldi Capital Advisors.

Garibaldi Capital decided to differentiate the Narwhal Club by including startups that launched as far back as 1999 in an effort to include more companies, including Vancouver’s BuildDirect.

On December 18, the teams at Garibaldi Capital and Visual Capitalist revealed an infographic (see below) displaying the newest entrants to the Narwhal Club as well as emerging narwhals.

Three out of the four new club members are based in Vancouver, including Hootsuite and Avigilon. And while most of Slack’s resources are based in San Francisco, founder and CEO Stewart Butterfield lives and works in Vancouver, where the company has a sizeable office.

The only other Canadian startup to reach valuation of $1 billion either this year or last was Ottawa’s Shopify.

Holliday said he believes tech startups have exploded in Vancouver is recent years due to the lack of venture capital available to them in the early goings. That forced companies led by visionary entrepreneurs to bootstrap and focus on generating revenue from customers, not investors.

“All of that led to an explosion of available capital to allow these companies to grow rapidly, turn into acquirers as opposed to being acquired,” Holliday said.

Avigilon announced December 18 it spent US$80 million acquiring all of ObjectVideo’s patents . This comes almost exactly a year after it purchased VideoIQ for US$32 million.

While Holliday said late-stage growth capital is easier to come by in Vancouver nowadays, he still hears concerns from startups about early stage funding.

But one early stage company based in Vancouver that managed to receive seed funding in time for Christmas was Vidigami Media.

The tech startup announced December 17 it had secured $1.25 million during its latest round of financing.

Vancouver-based investors include Aaron Rallo, CEO at TSO Logic Inc.; Jim Fletcher, a boardroom director at Vision Critical; and former B.C. Technology Industry Association president Rob Cruickshank.

“As an entrepreneur, you always think your idea is the best one, otherwise, why would you be killing yourself trying to make it work?” Vidigami CEO Mandy Chan said, adding she’s found the capitalization process to be especially challenging in Vancouver.
“(The seed funding) gives us so much more confidence in our ability to execute.”

She said the first order of business is using the seed money to hire a director of marketing, as well as supporting the sales team and the product developers. The company currently has 15 employees.

Vidigami has developed a software platform that allows schools to store and share photos with students and parents.

The company has been focusing on private schools since launching commercially in 2013. Among its 30 clients are Vancouver’s St. George’s School and Crofton House School.

Vidigami also recently signed on a school in Singapore with 5,200 students, but Chan said the focus going forward would be on the North American market. So far, Vidigami has more U.S. clients than Canadian.

“The opportunity for Vidigami is very strong and what we’ve been able to prove this last year is that the value proposition to our market is real and we’ve been able to validate it.”


Infographic courtesy of Visual Capitalist  and Garibaldi Capital Group

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