Growing up

Even as COVID-19 has upended the economy, disrupted working life and fuelled a chaotic 2020, Waterloo Region’s tech community has been having a banner year in terms of investment. September saw the continuation of a surge in investment after venture funding hit a five-quarter high of CDN$148.6 million in the second quarter of 2020, according to market data firm Hockeystick.

The fact that the bulk of Q2 dollars went into later-stage rounds “demonstrates that the Waterloo ecosystem is maturing,” BetaKit reported. Hockeystick analyst Max Folkins pointed out the significance of scale-up companies doubling down on Waterloo Region rather than moving to larger tech centres, saying, “All the big companies are staying there because the amount of support that the companies get in the region really incentivizes them to stay in the region.”

September activity only affirmed the trend, with two scale-ups that raised Series C rounds in Q2 – ApplyBoard and Clearpath Robotics – announcing top-ups to those rounds. ApplyBoard took on another CDN$70 million to extend the $100-million round it announced in May, while Clearpath’s OTTO Motors division added US$5 million to the US$29 million round it reported in June.

That’s not to say smaller companies were left out of the action last month. Just in time for harvest season, agtech startup BinSentry – whose technology monitors farmers’ feed-bin levels to streamline feed deliveries – reaped US$7.7 million in Series A investment from Missouri-based Lewis & Clark AgriFood.

ProNavigator, an AI startup that has been collaborating with Wawanesa Mutual Insurance Company (both companies have space in the Communitech Hub), announced a CDN$5.6-million Series A round, following a $2.2-million seed round in 2019. The company, which enables quick data retrieval to cut the time insurance policyholders spend waiting on the phone, is looking to expand its U.S. business.

Wagepoint, a 2014 graduate of Communitech’s former Hyperdrive accelerator program, took on CDN$10 million in growth capital from Providence Strategic Growth (PSG), which also took a majority stake in the payroll services company.

Rounding out the month’s funding news, Acerta Analytics Solutions, which provides AI-based quality control technology to automakers, announced a US$7-million Series A round led by OMERS Ventures. And startup Brink Bionics, which builds a hyper-responsive glove interface for gamers, raised a CDN$350,000 seed round.

Making a list

Revenue is, of course, another powerful indicator of growth. From that perspective, Waterloo Region tech companies were well-represented on the Globe and Mail Report on Business annual list of Canada’s Top Growing Companies. Of the 400 companies named to this year’s list, 12 are based in the region and 33 have worked directly with Communitech. At No. 14 and with 3,695 per cent revenue growth over three years, the top-ranked local company was TruLocal, based at Communitech, which connects local meat suppliers with customers through an online platform. Other local tech firms to make the cut were Encircle, Intellijoint Surgical, Voltera, Smile, Bridgit, Stryve Digital Marketing, Miovision, ThinkLP, eleven-x and TextNow.

The Globe list wasn’t the only one to resonate in the region’s tech community in September. In a study by Gallup, Canada was ranked as the most welcoming country to migrants in the world for 2019, topping a list of 140 countries. Canada’s openness is one of the selling points behind a Communitech talent-recruitment campaign in the U.S., which moved to New York City’s Times Square in September after a successful launch in California the previous month.

Attraction of skilled international workers has been a key priority for the Canadian tech industry, in part to stem the so-called “brain drain” of Canadian-bred talent to the U.S. To get a clearer picture of the challenge, Rob Darling, a data expert and Communitech’s former chief technology officer, published a study that used LinkedIn data to track the migration of University of Waterloo tech grads between 2017-19. 

Meanwhile, Communitech itself landed on a list of local recipients of Ontario Government funding to support training in the manufacturing and automotive industries. The funds will enable workers to enhance their careers in skilled trades.

A lucky 13 area startups were selected for the Waterloo-based Accelerator Centre’s latest JumpStart program cohort, with each receiving $30,000 in seed money and another $10,000 in in-kind support.

And The Canadian Shield – which went from seven-person startup to one of North America’s largest producers of personal protective equipment (PPE) in a matter of a few weeks this year – earned a top manufacturing award for its response to the COVID-19 pandemic.

Heeding the call

Speaking of the pandemic, local tech companies continued to pursue opportunities as rumblings of a second wave grew louder throughout the month.

MappedIn, whose indoor mapping and wayfinding technology is used in malls and other large spaces, launched an open-source contact monitoring system to help retailers reopen safely.

Relatedly, TallyFi – an alumnus of the Communitech Rev accelerator program – found a way to pivot its crowd-counting technology away from shuttered concert venues and nightclubs, to customers wanting to maintain safe numbers inside their spaces.

Emmetros, whose SparxConnect platform enables collaboration between healthcare providers, support workers, patients and their families, expanded the platform in response to the pandemic.

O2 Industries, maker of high-performance respirators and masks, announced a partnership with Las Vegas-based UFC to provide its mixed martial arts fighters with protective equipment.

Meanwhile, a cleantech company called Water Refined, whose primary market had been agriculture, developed a rinse-free disinfectant aimed at nursing homes, schools, office buildings, transit and other public spaces where curbing COVID-19 is an urgent priority.

The pandemic’s implications for working arrangements continued to ripple through the tech community in September. Among those weighing in was Mike Pereira, manager of the University of Waterloo’s David Johnston Research + Technology Park, who told the Waterloo Chronicle the pandemic could be “the greatest opportunity to rethink work in the history of humanity.”

Doing well, doing good

“Tech for good” will be a familiar theme to Roundup readers since Communitech launched its True North movement back in 2018, with an annual festival/conference and related initiatives with various partners. One of those initiatives was the Leaders Prize, which offered $1 million to a Canadian tech team that could effectively use artificial intelligence to combat fake news. In September, more than a year after that challenge was issued at True North 2019, a winner was selected from a field of 150 programmers, designers and engineers.

On the topic of True North, Kris Braun is a local software engineer who spoke at the 2019 conference about Talent Beyond Boundaries, a program that places highly skilled refugees from around the world in relevant jobs in safe countries. That year, Braun had helped bring a software developer named Mohammed Hakmi, a Syrian refugee, to Waterloo Region in one of TBB’s first successful placements. Now, Braun has launched a related local initiative called Tech Beyond Boundaries, to help more area tech companies to welcome refugees to their teams.

Of course, due to COVID-19, the True North Festival planned for 2020 was sidelined in favour of a weekly online video series, True North TV, featuring interviews with key figures working to build a better world. September’s TNTV lineup included Vidyard CEO Michael Litt; eSentire cybersecurity experts Mark Sangster and J. Paul Haynes; Leaders Prize founder David Stein and winner Bill Wu; BIPOC advocate Tyra Jones-Hurst; and author and corporate innovation expert Tendayi Viki.

Sustainable transportation is top of mind at scale-up company Miovision, whose technology helps municipalities manage the movement of people in urban environments. Miovision was named CIX 2020 Innovator of the Year. Of course, smarter movement in cities relies on movement of more data, which telecom companies are addressing with 5G network technologies. Rogers launched its 5G network on the University of Waterloo campus in September.

Speaking of smart cities, fast-growing eleven-x, provider of wireless networking tech for connected devices, launched a sensor-based system to help make more efficient use of parking spaces.

In other news:

    • Canada’s tech community was shaken by news that John Ruffolo, founder of OMERS Ventures and a former Communitech board member, was paralyzed from the waist down in a cycling mishap. In a social media post, Ruffolo said he will be “back in full force as soon as humanly possible” to launch his private equity fund.

This edition of the Roundup compiled by Anthony Reinhart.

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