Taleo Exit Generates Positive Effects for Quebec's Startup Ecosystem

Posted by Louis Rheaume

Capital Innovation recently organized a conference in Montreal about venture capitalism in the technology sector. Capital Innovation and the International Venture Forums grew since their launch in 2008 to become the largest innovation investment program in Quebec, supporting one of the most important networks of angel investors and venture capital managers in Canada.

One of the panels consisted of Chris Arsenault of iNovia Capital; Louis Tétu, CEO and Executive Chairman at Coveo and former CEO and Executive Chairman at Taleo Corporation; and Robert Talbot, VP Investments at Anges Québec.

According to the panel, the sale of Taleo to Oracle in early 2012 for $1.9 billion is having positive effects on the Quebec startup ecosystem. 

First, Taleo employees turned millionaires are launching new startups and are investing also as angels. Second, foreign and Canadian venture capital investors and angels are becoming more enthusiastic about the potential of Quebec startups—the idea of investing in a successful Canadian startup is stimulated by the recent sale of Taleo. Third, Taleo imported business and technology knowhow from US to Canada. Thus, in order to grow fast, Taleo became a public firm and moved operations to San Francisco to be closer to their customers, while maintaining a research and development centre in Quebec City. However, Taleo admitted to becoming public one year too early.

Some winning conditions must be met in order to see a similar success in Canadian entrepreneurship. Thus, exit deals over $100 million are rare and represent an inflection point in their existence. More capital is required in order to startup to build scale and grow revenues significantly.

Louis Têtu gave the recent example of Jive Softwave. The market value is at $1.6 billion, around 60 times revenues. In order to reach $70 million in revenues, Jive Software raised $90 million in capital.

“These are the new rules of the game," he argues. "Canadian venture capital must compete with the same weapons than US venture capital.  Canadian entrepreneurs need easier access to competent venture capitalists in order to grow fast."

Company:
iNovia Capital
Website:
http://www.inovia.vc
Location:
Montréal, Québec, Canada

iNovia partners with exceptional entrepreneurs to build successful companies in high-growth sectors. The team is comprised of entrepreneurs and sector experts focused on Mobile, Internet and Digital Media. iNovia has offices in Montreal, New York City and Calgary and invests across North America. iNovia has $275M under management across three seed and early-­stage funds. For more information, visit www.inovia.vc... more

Company:
Taleo
Website:
http://www.taleo.com
Location:
Québec, Québec, Canada

Taleo combines leading on-demand talent management solutions with the industry’s largest ecosystem of customers, partners and candidates. Taleo’s solutions and ecosystem together provide businesses of all sizes the Talent Intelligence necessary to better know their people and grow their businesses. More than 5,000 organizations use Taleo for talent acquisition, performance and compensation management, including... more

Company:
Coveo
Website:
http://www.coveo.com
Location:
Québec, Québec, Canada

Coveo transforms companies’ ability to gain insight from overwhelming amounts of diverse unstructured and structured data across all systems, on-premise, in the cloud and in social channels – enabling more efficient customer service, increased sales, shorter sales cycles, faster innovation for better product development and increased profitability. Among Coveo’s more than 400 customers are CA Technologies, YUM!... more


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Louis Rheaume

Louis Rheaume

Mr. Rhéaume has the scholarity of a doctorate in business administration, concentration in strategic management, innovation management and corporate finance. He holds a Master’s degree in finance. He has numerous years of experience in consulting, strategy, financial analysis and business intelligence, mainly in the telecommunications and computing industries. He has also been a researcher in... more



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