After spending most of the past two decades as a supporting player in the Ottawa tech scene, Kivuto Solutions might finally be on the verge of stardom.
The ByWard Market-based maker of educational software makes its home – when people are actually in the office, at least – in Shopify’s former headquarters at 126 York St. Despite 22 years of steady growth, however, the firm born in Halifax in the late 1990s under the name PowerKnowledge had never achieved Shopify-like market momentum.
But things are looking up for Kivuto.
The company’s revenues have surged over the past six months as educational institutions around the world pivoted to remote learning during the COVID-19 pandemic. On Monday, the privately owned firm announced it has secured $7.6 million in new equity funding from a group of existing U.S. and Canadian investors led by Roynat Equity Partners.
“I think in many respects this company's technology was way ahead of the curve,” says chief financial officer Blair Geddes, who joined Kivuto a year ago. “There’s a tremendous opportunity here.”
Now at about 85 employees, Kivuto makes a turnkey platform that delivers software, subscription cloud services and digital textbooks to businesses, elementary and high schools, colleges and universities in more than 180 countries.
More than 10,000 customers – including prestigious names in post-secondary education such as Harvard, Stanford and Oxford – now use its products, a number that’s risen throughout the pandemic as schools around the world have scrambled to get remote learning tools onto the laptops of students.
A 30-year tech veteran who began his career at Newbridge Networks, Geddes sees plenty of untapped potential in Kivuto’s offerings. Educational institutions have traditionally been “a little slow” to adapt digital technology, he says, but that old-school thinking has been tossed out the window in the wake of COVID-19.
“The momentum for schools to deliver their services online around the world is enormous,” he says.
Kivuto was already seeing more traction for its offerings even before the coronavirus became a household word. The company started talking to its shareholders about raising a new financing round in February, but the pandemic gave those discussions an even greater sense of urgency.
“It became pretty clear in mid-April that our business was starting to accelerate,” Geddes says. “Then our investors were all-in.”
Kivuto, which has added 13 people to its headcount since the spring, plans to use the fresh equity to grow its sales and marketing team in a bid to expand its footprint in key markets such as the U.S., Europe and Asia. The company also plans to boost R&D spending from its current share of about 15 per cent of revenues to nearly 20 per cent as it continues to add new products to its lineup.
With revenues expected to rise 50 per cent in 2020, could Kivuto finally be enjoying its own moment in the sun like the previous tenant at its York Street head office?
Geddes certainly hopes so.
“We just have to get out there and do what every software company has to do – and that’s show them how we solve their problems – and we'll be fine,” he says. “But we do have to get out there, and that’s really the basis for raising the money.”