A glut of under-utilized real estate in office portfolios around the world has brought enormous customers such as Amazon and Starbucks to the door of Kanata-based Internet of Things firm Relogix. Now, these enterprises are joined by Mistral Venture Partners, Ottawa’s own venture capital fund, as it leads a $1.4-million investment in the local firm.
Relogix considers this a top-up to its previously-raised $1.4 million seed round roughly a year ago. That round was largely made up of angel investors, with Ottawa’s Capital Angel Network getting a slice of the pie. This latest funding has a few CAN members involved, but includes more angels from the Toronto area.
Founded in 2010, Relogix has been on Mistral’s radar for a few years, but the startup’s traction with large enterprise customers over the past few months opened an immediate window of opportunity for the local fund.
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“The momentum they’ve achieved over the past year or so is what really caught our eye,” managing director Code Cubitt tells OBJ.
Opportunity in empty desks
Relogix deploys sensors across the offices of large enterprises and commercial real estate portfolios to collect data on how space is really used in buildings. These cheap, easily deployed devices can say, for instance, whether a desk is sitting empty most of the time or if booked meeting rooms are going unused.
CEO Andrew Millar says that with the rise of the internet and remote working, large office spaces are rarely fully utilized these days – a significant drain on a company’s ROI.
“The nature of work has changed,” he says.
It’s a problem facing companies in the capital, too. L-Spark, the Kanata-based accelerator company, recently announced that it would open up a co-working space with the excess real estate in its offices. As the accelerator expanded its scope from Ottawa-based to national firms, the amount of activity in its physical space declined significantly.
Millar says situations like this are affecting companies globally, presenting a problem for enterprises with large portfolios to manage. With Relogix, he’s eyeing an opportunity to deliver valuable data to help companies get the most out of their real estate.
‘The phone is ringing’
In the past few months, Relogix has quietly been adding some big name customers: the likes of Amazon, Starbucks and large banks such as Bank of America, Royal Bank and TD Bank.
Usually, Relogix will start with a 100,000-square-foot deployment across a few floors in one of the customer’s offices. Once that catches on, though, the door is often opened to the rest of the enterprise’s global real estate, which can range between 50-to-100 million square feet of space.
Relogix has channel partners that help to resell the Ottawa firm’s tech and then come in with proposed solutions for the under-utilized space. While this helps to extend the 14-person firm’s reach, Millar says most of Relogix’ sales have been through inbound requests.
“The demand is just overwhelming in the industry right now,” he says. “The message is getting around extremely fast. The phone’s ringing at Relogix and it’s Fortune 500 clients.”
Cubitt says he heard a “similar story” from the global distributors and large banks on Relogix’ customer list when he was reaching out for due diligence.
“In addition to workforce, the desks that house them are the second highest cost to a company,” he says.
After these calls, not only was it clear to Mistral that under-utilized space was an industry-wide issue, but that Relogix is currently ahead of the pack. Cubitt says the firm must “continue to innovate” to stay ahead of the market.
Filling seats at Relogix
With market validation and millions of dollars in seed funding secured, Millar says it’s time for Relogix to scale. There are five positions currently open at the firm and he expects to raise a series-A round in the next six-to-eight months for further growth.
Millar says he’s found plenty of great engineers to work for Relogix in Ottawa, which he notes is full of IoT potential. On the other hand, he says the National Capital Region is lacking when it comes to readily available software talent and Relogix has had to make a few hires from outside the city to find the right candidate.
Attracting prospective employees to Ottawa hasn’t been an issue though. He says Relogix is offering candidates “ground floor opportunities” – the chance to build a product in an emerging market rather than doing maintenance on some large enterprise’s servers.
“IoT’s in its infancy, but we found a sweet spot and we found good fit in the market,” he says.
Cubitt agrees, and points to Relogix as part of a growing trend of Ottawa-based firms finding traction in the IoT space.
“It’s another great example of an Ottawa company leveraging IoT and the power of the internet to make a really good enterprise solution.”
