After nearly tripling headcount, Ottawa-based Leonovus expects revenue in Q3

Blockchain

With dozens of potential customers lined up and a nearly-complete product offering, Ottawa’s Leonovus (TSX-V:LTV) says it expects to end its revenue-free streak next quarter.

The company, which develops a software-based storage solution encrypted with blockchain technology, reported no revenue and a net loss of $1.2 million for the three months ended June 30, 2018. (All figures in USD.)

Spending on sales, marketing and R&D was up across the first half of the year, a trend that’s expected to continue in the coming quarters.

Leonovus believes the higher expenses will pay off in the third quarter when its fourth-generation product is released. The company said in a release that it expects to close all of the 51 proofs of concept it currently has with potential customers, most of which are large organizations and nine of which are federal government agencies. Sales should ramp up further in the second quarter of 2019, it added.

“The government of Canada is about to become a large Leonovus reference customer, which is hugely important for our marketing communications to other large enterprises,” Leonovus CEO Michael Gaffney said confidently earlier this year.

Gaffney told OBJ last December that the 12-person company was “hiring like mad” to complete development on a market-ready blockchain storage product. Leonovus is now up to 32 employees and expects to hit 40 by the end of the year.