CIBC Tech & Innovation Market Update – November 2020

Welcome to the official newsletter of CIBC’s Tech & Innovation Capital Markets group

A curated monthly report to keep our readers abreast on relevant and recent developments within the Canadian tech ecosystem


Canadian technology sector performance and valuation

A Line graph showing increases in the Canadian technology sector performance and valuation

 
EV / NTM revenue multiples 1 LTM sector price performance 1
EV / NTM revenue multiples Bar graph: High-growth Canadian SaaS, 19.0x. Large Cap Canadian Tech, 5.2x. Mid Cap Canadian Tech, 4.0x. Small Cap Canadian Tech, 2.5x LTM sector price performance Bar graph: High-growth Canadian SaaS, 134.2%. Large Cap Canadian Tech, 18.0%. Mid Cap Canadian Tech, 37.3%. Small Cap Canadian Tech, 21.5%

Source: FactSet and Pitchbook; as at November 30, 2020; in C$ unless otherwise noted.
1 Please refer to the back page for technology group constituents.

 

Canadian Venture Capital market update

$129M

(vs. $245M in October-20)
Aggregate deal value

20

(vs. 32 in October-20)
Number of deals

$8M

(vs. $15M in October-20)
Avg. deal value

Alberta

($57M / 3)
Most active province ($ / #)

 

IT Services

(43.3% of funds raised)
Most active sector(s)

 

Noteworthy Canadian deals

Company Size Sub-sector Lead investors
F12.net logo C$36M Services Clairvest logo
Falk logo C$20M Commercial Services Ret logo
Purefacts logo C$20M IT Services Scotiabank logo
 

T&I @ CIBC

Deal announcement – CIBC Global Investment Banking

insig - C$30 million - Exclusive financial advisor on its sale to WELL Health, November 2020

Insig – $30 million

INSIG is a leading Canadian virtual care platform with a unique SaaS-enabled marketplace currently supporting over 2,800 healthcare practitioners.

shiptrack - C$50 million: Exclusive financial advisor on its sale to Descartes, November 2020

ShipTrack – $50 million

Headquartered in Canada, ShipTrack provides cloud-based mobile resource management and shipment tracking focused on final-mile solutions.

Deal announcement – CIBC Innovation Banking

Taplytics - Undisclosed growth capital, November 2020

Taplytics Inc. – Undisclosed growth capital

Taplytics Inc., Toronto and Palo Alto-based, is a single platform for both enterprise marketers and engineers to optimize the entire digital customer experience. The additional capital will help accelerate Taplytics’ customer acquisition strategy and growth plans across North America and Europe.

 

Podcasts

 

Technology & Innovation in‘sites’ with CIBC Equity Research

T&I ‘Bits & Bytes’

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Shopify web traffic growth into Black Friday only modestly higher

We revisit global web traffic to ecommerce websites and compare their growth in 2020 to 2019.

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2020 Tech M&A recap – tracking North American tech deals in a Covid-19 world

While 2020 spending on tech M&A is very likely to be below prior year levels, spending accelerated in the second half of the year and total number of acquisitions has surpassed the 2019 level.

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The Future of Remote Work Webinar recap – implications of the Covid-induced move to remote work

This virtual event explored the longer term implications of the move to remote work.

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Restaurant data shows slight softening that could impact Lightspeed

We revisits web traffic trends for restaurant delivery, reservations and dining-in for Lightspeed’s core restaurant and hospitality markets of Germany and Australia.

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Singles Day 2020 – event highlights hot retail market; regulatory concerns

Singles Day, a Chinese holiday on November 11, was originally conceived as a tongue-in-cheek celebration for the romantically unattached but is now known as the single largest physical and online global retail event.

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Tech stocks on sale? – Vaccine optimism leaves tech behind

While news of a coronavirus vaccine that was over 90% effective had the public dreaming of big meals at their favorite restaurants and overseas vacations, technology stocks seems to have been left out of the fun.

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Post Covid-19, what could ecommerce look like?

We revisit global web traffic to ecommerce websites and compare their growth in 2020 to 2019.

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Tracking the 5G wireless wave; 2021 outlook and network plans

We revisit global web traffic to ecommerce websites and compare their growth in 2020 to 2019.

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The public premium – public valuation premiums driving IPO activity

One of the biggest questions facing successful start-up companies is whether they should publicly list shares, look for an acquirer, or continue growing as a private company.

 

Recent technology news

“Tech in the Biden era”

“Biden isn’t likely to rekindle Obama’s technocracy, but it’s complicated.”

Read the full article at Tech Crunch.

“Sean Silcoff explains how 2020 became the Year of the Canadian Tech IPO”

“Earlier this year, Globe and Mail Technology reporter Sean Silcoff wrote that “private is the new public” – in essence, that IPOs and public markets were not the first choice for tech companies looking to exit. Shopify and Lightspeed aside, Canadian tech IPOs were few and far between.”

Read the full article at BetaKit.

“10 breakthrough technologies 2020”

“Here is our annual list of technological advances that we believe will make a real difference in solving important problems.”

Read the full article at MIT Technology Review.

“VCs are pouring money into the wrong education startups”

“The pandemic has proven the need for new technologies that can radically change online learning models.”

Read the full article at Wired.

“Five ways SaaS CFOs can help their company scale”

“Despite the role that CEOs, CTOs, and product managers play in a startup’s success, finance is the only department in a SaaS startup that touches every part of the customer journey.”

Read the full article at BetaKit.

 

Tech & Innovation Key Contacts

Roman Dubczak
Deputy Chair
Kathy Butler
Vice Chair and Head of CIBC Capital Markets – B.C.
Emilie Bissonnette
Managing Director, Global Investment Banking
Frazer Wong
Executive Director, Technology & Innovation, Global Investment Banking
Mark Usher
Executive Managing Director, Innovation Banking
Mark McQueen
President and Executive Managing Director, Innovation Banking
Robert Rosen
Managing Director, Innovation Banking
Julia Kassam
Managing Director, Innovation Banking
Paul McKinlay
Executive Managing Director and Co-Head
Amy Olah
Managing Director, Head of Canada & US West Coast Venture Banking, Innovation Banking
Eric Laflamme
Managing Director, Innovation Banking
Joe Timlin
Managing Director, Innovation Banking
Rob Magwood
Managing Director, Equity Capital Markets
Daniel Lee
Managing Director, Technology & Innovation, Global Investment Banking
Stephen Redding
Managing Director and Head

Canadian Technology Constituents

High-Growth Canadian SaaS – Ceridian, Descartes, Docebo, Kinaxis, Lightspeed, Shopify

Large Cap Canadian Tech – Altus, Blackberry, CGI, Constellation Software, Enghouse, Evertz Technologies, Nuvei, OpenText, Real Matters

Mid Cap Canadian Tech – Absolute Software, Calian, Celestica, Computer Modelling Group, Dye & Durham, Sierra Wireless

Small Cap Canadian Tech – Alithya, Baylin, BBTV, Blackline Safety, Converge Technologies, Optiva, Patriot One, Pivotree, Quarterhill, TECSYS, Terago, Sangoma, Sylogist, Vecima, Vitalhub

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