As his fast-growing tech firm continues its rapid scaleup journey, Ottawa’s Mike Potter says he welcomes the heightened expectations that come with making a market splash.
Potter, the CEO of data protection software firm Rewind, makes his point using an example from another business where there’s a lot on the line: professional sports.
The engineer-turned-entrepreneur recently watched an episode of the Netflix documentary series The Playbook that focused on Doc Rivers, the new coach of the NBA’s Philadelphia 76ers. Rivers’s philosophy of dealing with pressure instantly hit home with Potter.
“His attitude is exactly what I want my company to take, which is, you embrace (pressure),” says the rising tech exec, who co-founded Rewind with software engineer James Ciesielski.
“We think that we’re fortunate to be in the position where people are expecting big things of us. We’ve run this business now for four or five years. We’ve demonstrated that we know how to grow it. Every time that we’ve raised money, we’ve increased the amount of money that we’re making.”
Now, a new group of investors is betting that trend will continue.
Rewind said Tuesday it has landed a US$15 million series-A financing round led by Montreal-based Inovia Capital. Ridge Ventures and Bessemer Venture Partners also participated in the round, which the company will use to fuel its continued expansion as it builds out its subscription-based platform that backs up customers’ sales and financial data in the cloud.
Previous investor ScaleUP Ventures also joined the round, as did return investors Fundfire, Mistral Venture Partners and other unnamed angels.
Backup for Shopify merchants
Founded in 2015, Rewind has worked with more than 80,000 customers. It currently has about 20,000 active users – most of them merchants who operate online stores on Shopify’s platform and want to make sure their accounts are protected from events such as power outages or cyber-attacks.
About three-quarters of Rewind’s revenues now come from Shopify-powered storefronts. But that share is falling as the company expands its backup services to users of other platforms, including Shopify competitor BigCommerce and accounting software giant QuickBooks.
Fortified with fresh equity, Rewind is now looking to add more technology platforms to the mix in 2021. Potter says the firm is poised to bring eight or nine more services into the fold by the end of the year, including project management platform Trello and another customer that will be announced in the next few weeks.
"Really for us, I think the sky’s the limit in terms of the potential growth here."
“We believe the best strategy is to just go as broad as possible,” he explains. “We want to cover off as many SaaS services as we can. Really for us, I think the sky’s the limit in terms of the potential growth here.”
Inovia Capital partner Magaly Charbonneau, who was introduced to Potter and his team last summer, says it was clear from the first meeting that they were “building something very special” in the Ottawa tech scene.
“They’re resolving a real pain,” says Charbonneau, who has also taken a seat on Rewind’s board of directors. “They're efficient and they’re aggressive. Their product vision and their strategy is very clear to us. That made us feel very confident. I think they’ve got something that’s going to be easily repeatable.”
While Rewind was making a name for itself even before COVID-19 hit – growing its revenues more than 1,100 per cent over the past three years – Potter says the dramatic surge in e-commerce activity during the pandemic accelerated the firm’s ascent.
The company quietly raised a couple of million dollars in seed capital from local angels last summer, triggering additional interest from institutional investors who’d been following its progress.
“I think word of that round got out, and then people started pursuing this fairly aggressively,” Potter says.
“We’ve been courted by investors for quite a long time. Most investors have some sort of software that is monitoring how successful startups are. A bunch of these have been relationships that we’ve been developing over the years.”
Hunting for 'top talent'
After more than doubling its headcount from 30 to 65 in the past year, Rewind is aiming to grow its workforce to 130 by the end of 2021. Charbonneau cites recruiting and retaining talent as the biggest challenge facing the firm right now, and Potter agrees.
Considering Ottawa’s tight tech job market, that means casting a wider net for new hires. About 20 per cent of Rewind’s employees are already located outside Ottawa, and Potter says the firm will continue to search beyond the capital’s borders.
“We’ll go to where the top talent is, regardless of where they’re located,” he says.
The CEO is also teasing the possibility of using some of the new capital for acquisitions, saying the firm will likely be announcing an M&A deal in the near future.
“We’re actively looking,” Potter says. “The vision for Rewind is we want to back up the entire cloud, and so if there are competitors or companies that are already backing up the platforms that we’re looking to move into, then we would look at acquiring those as a way of getting into that market instead of building the solution ourselves.”