You.i TV’s banner 2015 got even better on Monday, when the Ottawa software company announced it has landed $15 million in venture capital funding.
The firm, which makes user interface software that helps people interact with devices from TVs to tablets, had bootstrapped its way to No. 7 on OBJ’s list of the capital’s fastest-growing companies earlier this year.
But founder and CEO Jason Flick said Monday You.i TV needed to tap into outside sources of investment if that hockey-stick trajectory was to continue.
“We’re very excited,” he said. “The TV space is ridiculously frothy now. Apple came out and said the future of TV is apps, and that’s massive. We’re working with some of the biggest brands on the planet. It’s a lot of fun.”
The round was led by Los Angeles-based Kayne Partners, the growth private equity group of Kayne Anderson Capital Advisors L.P., an alternative investment firm that manages more than $27 billion US in assets.
Mr. Flick said You.i had been wooed by plenty of potential suitors willing to give it cash, but Kayne stood out from the pack.
“These venture companies just kept calling us, and we’d really given up in the last year or so because we added 100 staff in one year and we’ve been growing really well,” he said.
“But they kept calling us and I just kept getting more efficient about taking their calls, telling them our story and saying, ‘Hey, if you know the industry, let’s keep talking. If you don’t, let’s not talk anymore.’ Kayne really knows our industry. So of the calls every other week that I was getting, we picked them. They’re going to be a great ally for us.”
You.i’s technology is already being used on projects that include Sony Crackle’s Roku app and the TreehouseGO app, which hit No. 1 on Apple’s Kids App Store two weeks after its launch.
The company said it will use the new funding to “create a channel of partner agencies” to build apps for a variety of devices on its signature platform, known as You.i Engine SDK, adding the goal is “to put the technology into as many hands as possible.” Mr. Flick said You.i has already inked deals with at least three major partners.
But he said the alliance with Kayne offers more than just money to You.i, which is now working with high-profile corporate clients such as Adobe, Sony Pictures Entertainment and Corus Entertainment.
“They know the media world,” he said. “They can call up the CEOs of some of the biggest companies in the world and say, ‘Hey, this is one of our many portfolio companies. Help them out.’ We’re already seeing some benefits from just having that kind of credibility and presence in the U.S.”
Mr. Flick said he expects the firm’s headcount to grow from its current total of about 150 to at least 200 by the end of the current fiscal year in June 2016. More major announcements about new products and partnerships are coming soon, he added.
You.i’s continued expansion will also have spinoff benefits for other local companies, he noted.
“A part of that is to build an ecosystem, and we want to build it here in Ottawa as much as elsewhere,” he said. “We do a lot of outsourcing here in Ottawa … and I want to continue to do that as well.”
You.i is the latest in a string of local tech firms that have recently landed substantial venture capital funding, including AirVM, GaN Systems and Solantro Semiconductor.
Mr. Flick also credited e-commerce giant Shopify, which launched a hugely successful initial public offering on the New York and Toronto stock exchanges earlier this year, for helping put the city’s tech sector back on venture capitalists’ radar.
“People are noticing Ottawa,” he said. “Raising that much money and bringing the profile up has been huge. But I also think the markets are realizing that there’s a lot of viable, great companies in Ottawa. I think they realize there is incredibile amount of startups in Ottawa that, if they had funding, could do so much more. You’re going to see a lot more. I think we’re all kind of helping each other to make this (sector) even more successful.”