Ottawa-based software-maker Solace has received a vote of confidence from a major investor as it faces heightened competition from one of the best-known names in tech along with AI heavyweights that could threaten its stronghold on the market. One of the top performers in the city’s tech scene over the past decade, Solace will have […]
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Ottawa-based software-maker Solace has received a vote of confidence from a major investor as it faces heightened competition from one of the best-known names in tech along with AI heavyweights that could threaten its stronghold on the market.
One of the top performers in the city’s tech scene over the past decade, Solace will have plenty of cash to fuel its continued growth thanks to a new infusion of equity from Bridge Growth Partners and a slew of other investors.
The New York firm said this week it has raised US$790 million worth of fresh funding in a secondary transaction that will help it maintain a significant stake in Solace. The transaction was co-led by Apogem Capital, Golub Capital, HSBC Asset Management and Schroders Capital, with participation from Bridge Growth Partners III, the firm’s latest flagship fund.
In addition, the Healthcare of Ontario Pension Plan, a minority investor in Solace, is rolling its existing equity stake into the new investment vehicle.
The new arrangement means Bridge Growth, which acquired a 51 per cent ownership stake in Solace in 2016, will have a reduced stake in the company. Once the transaction closes, the New York firm and its affiliates will represent about 15 per cent of Solace’s total equity and will continue to manage the business, Bridge Growth chief executive officer Alok Singh told Bloomberg News in an interview this week.
Solace chief executive Denis King told OBJ Wednesday the deal will give his fast-growing company the financial boost it needs to stay ahead of the competition.
“We were able to get a great valuation and a great set of new investors to come in and take us to the next level, and I think that’s really what this is about,” he said.
“I think this was the preferred path because it allows us to continue to execute on our strategy. If you sell to a strategic (investor) or you go to the public markets, you face a whole bunch of other challenges.”
King said Bridge Growth senior principal Tom Manley, who chairs Solace's board of directors, has been a “big part” of a steady ascent that has seen Solace grow from about 125 employees in 2016 to more than 550 today. Meanwhile, about 97 per cent of Solace’s total revenues are recurring, up from 35 per cent before Bridge Growth acquired a stake in the firm.
“They’ve brought in some amazing advisers,” King said. “They’ve really guided us through the transition from a licence-based company to recurring (revenue) business.”
The influx of fresh capital comes at a critical time for Solace, which specializes in products known as “universal translators” that help speed up the flow of traffic among data centres, smartphones, software applications and, increasingly, AI agents.
In a world where streams of data are constantly flowing from one point to another at lightning speed through a series of “events” – say, the swipe of a credit card or a scan of a boarding pass – Solace’s products aim to smooth out bumps along the way, ensuring that information flows as quickly and securely as possible.
It’s big business. Solace now has more than 400 customers, up from just 200 a few years ago, mostly in the financial services, retail, manufacturing and transportation sectors. Well-known brands that subscribe to its products include Bosch, Heineken and United Airlines, and King says the platform is starting to gain traction in the public sector as well.
Solace’s recurring revenues rose 34 per cent last year compared with 2024, and King expects that momentum to continue as more of his company’s clients turn to applications powered by artificial intelligence to interact with customers.
The way the veteran CEO sees it, Solace’s technology is ideally suited to ensuring that AI agents can talk to people and other applications, with no hiccups or glitches.
“At the end of the day, Solace is a real-time data platform,” he said. “We live in a world today that’s always connected. We live in a world today where people want data faster today than they did yesterday. And we live in a world where there are more applications that are more distributed than ever before. And guess what? We have a way to connect those applications and allow them to communicate in real time.”
Bridge Growth Partners is also betting that AI will give one of the top-performing companies in its portfolio a healthy bump.
Singh told Bloomberg this week that Solace’s total addressable market – which King pegged at more than $15 billion a few years ago – is expected to increase dramatically due to the growing use of artificial intelligence.
“Enterprises are going to have millions and millions of agents everywhere,” Singh said. “They all need data in real time, and Solace seamlessly connects everything without having any drops.”
