Managing/Capital Partner James Lochrie and Community Partner Jim Gibson talk about nurturing the innovation ecosystem to create more successes like Symend
by Chris Varcoe, The Calgary Herald (February 2021)
Having just raised $55 million at the growing tech firm Symend, company CEO Hanif Joshaghani is setting his sights on both domestic and international expansion.
The Calgary-based software firm opened an office in Australia last fall and is making plans for the business in Latin America and other major markets.
But Joshaghani expects to drive global growth — and much of its new hiring — from the company’s headquarters in Calgary.
“I make the joke internally that I can see this company getting bigger than our biggest oil companies. I see a future where we are a top-five biggest tech companies in Canada …that’s what we are driving towards, to build a category leader,” he said in an interview.
“A lot of hard work and execution (is required) between now and then, but I do see that future. That is what we are marching towards.”
Earlier this week, the Calgary-based software firm announced it completed a financing round, led by Inovia Capital, following on $73 million it raised last May.
The local company counts telecommunication firms and banks among the clients using its digital customer-engagement platform that helps deal with delinquent accounts.
Founded in 2016, it has become a noteworthy tech growth story in the city, entering last year with 51 employees. It now has about 260 staff and Symend could hire another 200 more workers this year, “if things really start to move,” he said.
The additional funding will provide more fuel for the company’s expansion efforts. Symend already has offices in Toronto, Denver and Melbourne, aside from its head office.
“I would say this year is where we start in earnest investing into international growth, with still the main focus of the company being on North American core markets,” Joshaghani added.
The news comes as the city’s tech sector is gaining traction, despite the drag of a recession and pandemic.
Calgary-based technology firms raised $286 million during the first nine months of last year, according to the Canadian Venture Capital Association, easily eclipsing the $136 million garnered in 2019.
“These companies have been in the works for quite a while; you plant the seeds, things grow and eventually things pop up." --- Jim Gibson, SAIT School for Advanced Digital Technology/Community Partner, Thin Air Labs
In December, Benevity Inc. earned the unicorn valuation status in the industry, after landing a US$1.1-bilion deal with a British firm that acquired a majority stake in the company.
Just last week, Veerum, which provides software that allows for a customer’s assets to be digitally viewed and data to be managed remotely, announced it raised $7.4 million in Series A funding. The money will allow it to expand into global markets and hire additional staff.
Grabbing the attention of policy-makers, media and investors is important, as Calgary’s tech sector has long been overshadowed by larger, more developed markets such as Vancouver and Toronto.
“We still have a long way to go, let’s be clear,” said Sandi Gilbert, past chair of the National Angel Capital Organization and managing director of Calgary-based private venture fund InterGen.
“But these wins are clearly a signal to the market that we have the talent and ability to build companies here.”
In a province enduring a historic economic contraction — more than 87,000 positions disappear since the pandemic began — this is a welcome shift.
According to provincial data, the number of tech-sector jobs grew by 25 per cent to 67,000 during the 12-month span that ended in December. However, the figures also highlight the fledgling nature of much of the sector. Of the 11,300 tech businesses in Alberta last year, six in 10 were owner-operator firms with no employees. Only 116 had more than 50 employees.
Jim Gibson, dean of the SAIT School for Advanced Digital Technology, said the recent achievements are part of a natural evolution as the local ecosystem expands.
“These companies have been in the works for quite a while; you plant the seeds, things grow and eventually things pop up,” Gibson said.
“This is natural and really, really good, but we need this happening on a very consistent basis. We can’t just have one or two; we have to have dozens.”
The success of tech companies like Benevity and Solium, which was bought by Morgan Stanley for $1.1 billion in 2019, are validation that opportunities exist for local entrepreneurs and investors.
"We don’t see that type of aggressive growth in Calgary because it hasn’t been our core bread and butter. However, we are going to see this over and over again in Calgary in the next decade.”--- James Lochrie, Managing/Capital Partner, Thin Air Labs
James Lochrie, managing partner and co-founder of Thin Air Labs, an early investor in Symend, said the startup “found a small niche in a massive market, and those are worth billions of dollars today.”
In such cases, aggressive growth and speed to market are critical to staying ahead of competitors. And that requires money.
“The ability to move fast with a lot of capital and aggressively capture the market is a tried-and-true growth strategy of companies. This is the Silicon Valley playbook,” Lochrie said.
“It’s just uncommon in Calgary. We don’t see that type of aggressive growth in Calgary because it hasn’t been our core bread and butter. However, we are going to see this over and over again in Calgary in the next decade.”
At Symend, Joshaghani is bullish on the opportunities ahead for the firm and the local tech industry. The company currently has 20 available jobs listed on its website, everything from financial analysts and software engineers to openings for a regulatory affairs lawyer.
Symend has recruited experienced executives who’ve helped build companies, including hires from the San Francisco area and Seattle, but it will continue to have a “bias” towards hiring in Calgary, he added.
“Calgary will always be the headquarters,” Joshaghani said, pointing to the company’s recent decision to lease a 79,000-square-foot downtown office.
“I’d say 70 to 80 per cent of our people are here. We continue to hire very aggressively in our local market. But we also recognize that to build a company like this, there will be a good contingent of international employees as well.”
Chris Varcoe is a Calgary Herald columnist.
IMAGE: Hanif Joshaghani and Tiffany Kaminsky co-founded local tech company Symend, to help clients better deal with debt. PHOTO BY HANDOUT