Halifax-based Proposify has raised a significant funding round led by businessmen John Risley and Brendan Paddick, which should help the company more than double its staff to 60 this year.
The parties involved in the deal, which closed last week, are not revealing how much was raised by the company, whose Software-as-a-Service product automates the process of writing proposals. But CEO Kyle Racki said in an interview the deal values Proposify at about $30 million.
For several years, Racki and Co-Founder Kevin Springer have been at least doubling sales annually, so they now have about $4 million (and growing) in annual recurring revenue, or ARR. As of last summer, the duo was undecided about whether to raise capital or just continue organic growth, but they recently decided their fast growth and the size of their potential market warranted bringing on new capital.
“The timing just felt right,” said Racki, bleary-eyed but happy after a business / pleasure trip to San Diego, where he met clients — and got engaged. “We felt like we had got the initial traction, but if we really wanted to get the company to the next level . . . to become a $100-million ARR company, that we needed capital to do that."
Proposify’s software simplifies and enhances the process of writing proposals in the cloud with online proposal design templates that can easily be customized with text, images, videos and charts. Racki said it allows Proposify’s 6,000 clients to close deals more quickly, which increases their revenues. The product, which is constantly being improved, gets into such cutting-edge markets as e-signatures, sales enablement and sales automation. The e-signatures market alone is forecast to grow 39 per cent, compounded annually to $2 billion in the four years to 2020.
Proposify is growing even more quickly than its markets. In 2017, the company’s ARR increased 121 percent to $3.9 million, and Racki expects its ARR will hit $10 million by the end of the year.
Proposify last raised capital in 2014 — a pre-seed round that featured a $250,000 investment from Innovacorp and additional funding by angel investor Patrick Hankinson. Innovacorp came back into the current round, joining Risley and Paddick.
Though best known as founder and chairman of Clearwater Seafoods, Risley has been getting more involved with startups. He is a fellow of the Creative Destruction Lab – Atlantic, and his investment company CFFI Ventures Inc. has invested in such Halifax-area companies as the sports data platform Kinduct and Velo Industries Inc., which has developed a messaging service targeting small and medium-sized businesses.
The Proposify principals are now ramping up the company, planning to expand the staff from the current staff of 27 to about 60 by the end of the year. Building up the sales team will be a huge focus, and the team recently brought on Lisa Jackson, a veteran of Radian6, Salesforce, Eastlink and BlueDrop Performance Learning, as the vice-president of sales and customer success.
“What we want to do as a company is to improve the sales process,” said Racki. “We’re positioned very well to be a leader in this market.”