A few years after spinning off from parent company DataKinetics, omNovos is finding enough success in the retail industry to make a major purchase of its own.
The Ottawa-based company announced last month it had acquired OptiView, a five-person firm in Vancouver that helps retailers manage their inventories. The new tech will plug well into omNovos’ existing solution says CEO Allan Zander, whose company provides analytics to retailers across their online, mobile and in-store operations.
Financial terms of the acquisition were not disclosed.
Back in 2015, omNovos spun off from DataKinetics – an analytics firm focusing on the financial sector – to pursue opportunities in the retail space. The new firm’s data mining capabilities help its clients better understand their customers’ behaviours across multiple channels.
The firm’s most notable customer is Ottawa-born grocer Farm Boy, though Zander says the startup has been using channel partners from its parent company to make inroads as of late with pharmacies, restaurants and a fashion retailer in Brazil.
“We’re actually quite proud of that, that omNovos is growing to be a global company,” he says.
The OptiView move is actually the firm’s second acquisition following a 2016 deal that saw it acquire another Vancouver-based firm, MiniCheckout. Though it continues to share some space with DataKinetics, omNovos now has roughly 25 employees with an office on the west coast born out of its M&A activity.
To explain omNovos’ acquisition strategy, Zander turns to the 2011 Brad Pitt-Jonah Hill flick Moneyball. An appropriate analogy for an analytics firm, the film tells the story of real-life Oakland Athletics general manager Billy Beane as he leads the cash-poor team to success by using sabermetrics, a now-commonplace approach to baseball that focuses on niche statistics to maximize the efficacy of undervalued players.
“We’re not a large company, we don’t have hundreds of millions of dollars to throw at an acquisition,” Zander says.
Instead, when he heard from omNovos’ customer base that they were struggling with inventory management, he sought a “hidden gem” with the specific toolset that could solve the problem for mid-size retailers in his firm’s target market.
“That’s what we totally found with OptiView.”
If business follows expectations for the remainder of the calendar year, Zander expects omNovos to end 2019 with 60 per cent revenue growth. Though the local firm is riding high with acquisitions and growth plans today, a sizeable M&A play elsewhere last year had Zander worried.
Empire Co. Ltd., the parent company of Sobey’s, announced plans in September to acquire Farm Boy in an $800-million deal. When Zander heard the news, he feared the new owner of his “biggest and boldest” customer was going to take the much-loved grocery chain in a direction that didn’t include omNovos.
“We were pretty nervous and scared when we saw that announcement,” he says.
It turns out, however, that his fears have been unwarranted. On the contrary, Zander says the acquisition has only brought omNovos closer to Farm Boy as Empire looks to take its new prize to a national level.
“All of the reasons to be scared have pretty much gone away,” Zander says.