Vancouver's HootSuite Media, Waterloo's Desire2Learn, and Vancouver's Vision Critical Communications are "among technology companies that will be ready to go public within two years," according to investor John Ruffolo of venture capital firm Omers, who was cited in a report by Bloomberg on a potential forthcoming wave of Canadian tech IPOs.
Canaccord Genuity Group forecasts that more than US$400 million will be raised through technology IPOs in Canada this year, which would be the most for the industry in more than a decade, according to data compiled by Bloomberg. Canadian investors are turning to technology for growth after three straight years of declines for mining and materials companies ... Technology companies in the country rose 36% in 2013, the biggest gain in four years and returning more than comparable U.S. firms. Entrepreneurs are choosing to stay in the country instead of moving to the U.S. because of the increasing availability of pre-IPO funding, said Ruffolo.
HootSuite, Desire2Learn and Vision Critical “certainly are big enough and the markets are ready enough,” said Tom Astle, head of strategy at Toronto investment firm Difference Capital, told Bloomberg, adding that "the market still seems to be fairly open."
HootSuite has been speculated to have a value of anywhere from $500 million to $1 billion following its record-breaking $165 millon Series B funding round last year. Founded in 2008, it's a lot younger than D2L or Vision Critical, which launched in 1999 and 2000 respectively. Astle figures HootSuite could easily raise well over $50 million in an IPO today, according to the report in Bloomberg. The Canadian company would be riding the wave of social media IPOs in the US, including Facebook, LinkedIn, and Twitter.
Five of the technology companies OMERS has invested in will be ready to sell shares to the public within the next two years, Ruffolo said. “We have the deepest IPO pipeline that we’ve ever seen,” he said in an interview at his Toronto office. In addition to Desire2Learn, Hootsuite and Vision Critical, e-commerce company Shopify Inc. and BuildDirect, an online construction-materials store, may soon be ready to go public, he said.
Shopify has also been valued speculatively at close to $1 billion and, like HootSuite, is young, having been founded in 2006. BuildDirect's is as old as D2L, having launched in 1999.
But the companies themselves remain quiet. D2L declined to comment to Bloomberg, as did Vision Critical, and HootSuite, and Shopify, and BuildDirect. HootSuite and Shopify have previously stated that ultimately they went to go public, but neither will offer even the vaguest idea of timing.