Tuesday, December 21, 1999
Ardesic gets first $500,000 from new fund
A small Waterloo company that develops e-commerce software is the first business to get the financial backing of Waterloo Ventures Inc., a fund that provides seed capital to young, Internet-related companies in the K-W area.
Ardesic Corp. will receive $500,000 -- the first major infusion of capital for the six-month-old company. In return, Waterloo Ventures receives an agreed upon number of common shares of the privately held Ardesic.
"This infusion of venture capital allows us to speed up product development and help us attract the sales and marketing talent we'll need," said Jeff Fedor, Ardesic president and CEO.
Ardesic now employs three people. Fedor said in an interview that he hopes to double that by hiring over the next week or so.
Ardesic provides electronic relationship management services -- software that connects and synchronizes a company's sales, service and marketing information.
Fedor said the company has modified its original marketing plan, rethinking its Emporio suite of Internet services and concentrating its focus on one aspect of the suite: electronic relationship management.
"In talking to (venture capitalists), we realized that by bringing a suite to market there was a lot more baggage than if we just focused on a particular section of what our suite did and its strength," he said.
"So the reality was, do you really want to slug it out with Microsoft, Ironside, Open Market, etc. Or do you want to look at perhaps working with these guys, given that we're quite a small company."
Fedor said Ardesic will use some of the $500,000 investment to add leading-edge features such as support for Linux and WAP (wireless application protocol) to its product.
Linux is the operating system that's fast gaining worldwide popularity and giving Microsoft Windows a run for its money. WAP allows access to traditional Web or Internet services over wireless devices, like a cell phone.
Andrew Abouchar, fund manager for Waterloo Ventures, said Ardesic is the kind of early-stage, high-potential e-business that the fund wants to support.
He said Ardesic won-over the fund's investment committee with three key factors: "Exciting technology; a great market space; and an aggressive management team that was interested in working closely with us to grow the company."
In terms of "market space," Abouchar said e-commerce is really taking off and he believes that companies providing core technology, like Ardesic, are positioned to soar with it.
"We've just scratched the surface of e-commerce," he said.
Waterloo Ventures Inc. is an offshoot of Working Ventures Canadian Fund, one of the largest labour-sponsored investment funds in Canada.
The $5-million Waterloo Ventures fund was formally launched in September to provide initial investments of $250,000 to $500,000 in early-stage computing firms. The fund is co-sponsored by Wilfrid Laurier University, University of Waterloo and Conestoga College.
Abouchar said the fund is interested in hearing from potential partners."We are actively pursuing opportunities in the internet-networking space and our decision criteria focuses around our perception of the strength of management," he said.