File-sharing enterprise TitanFile Inc. of Halifax on Tuesday secured $250,000 in equity financing from Innovacorp., valuing the company that started last year at more than $2.5 million.
For TitanFile, the all-common-stock funding will add to the buzz for a young company that can already boast success in recent competitions and an impressive revenue stream. For Innovacorp, the second funding announcement this month shows Nova Scotia’s government owned technology commercialization agency is building up momentum in its funding of startups.
Founded by Milan Vrekic and Tony Abou-Assaleh, TitanFile’s technology allows clients to easily and securely share large and/or confidential documents over the Internet, both inside and outside their organization.
When they started the company last year, they thought their key clients would be groups like brokerage firms, which frequently send out confidential material to several clients simultaneously. Where they’ve found a lot of success is in the mid-sized law firms, which like such features as restrictions on the ability to print or copy emails.
Vrekic said in an interview yesterday the company has about 500 clients, mainly in Canada, though it has several clients in the U.S. Some American clients like the fact the TitanFile servers are in Canada. That means files sent on the TitanFile system are not subject to the Patriot Act, which means the U.S. government cannot access them.
Vrekic and Abou-Assaleh, who have been financing the company out of revenue since they started it, plan to use the Innovacorp funding to roll out TitanFile further into the U.S. They believe the product will resound with larger law firms.
``The long-term goal is to have a second data centre, this one in the U.S., which will likely happen in six months,’’ said Vrekic.
This round of financing, in which the founders gave up less than 10 percent of the common stock, will last about nine months. By the time that expires, TitanFile hopes to have raised a second round worth about $1.5 million to $2 million. Vrekic said a number of potential investors were interested in coming into the first round, but they opted to accept the funding from Innovacorp.
The company will ``definitely’’ be looking beyond the Atlantic Region for its next round of funding, said Vrekic.
The announcement comes just three weeks after Innovacorp revealed it was taking up half of a $500,000 funding round by Sydney-based music administration company, Marcato Digital Solutions.
Disclosure: Innovacorp is a sponsor of Entrevestor.
