Ryan Holmes in 2013: “Why does Silicon Valley get to have a monopoly on innovation? Why aren’t new tech mafias springing up elsewhere? The Internet radically decentralized information and ideas. So why is startup success still confined mainly to one corner of California?”They’re almost there.
Today, Hootsuite made headlines internationally for the umpteenth time, this time because the Vancouver-based social media wunderkind secured an investment from Fidelity that values the company, according to a source quoted by The Wall Street Journal, at $800 million.
There are now really just two paths available to Hootsuite. The company will be bought out by an international tech giant at a ridiculous price, or it will IPO.
The first option is unlikely, but as we learned from Facebook’s purchase of WhatsApp for $19-billion, everything has a price. The second is more plausible, if only because the company will run into the SEC’s Section 12(g), the “500 shareholder” rule that eventually forced the hand of Google, Zynga and countless others to go public.
Regardless of the path that Hootsuite takes, its work here is almost done. No, I don’t mean as a business. On that side of things, the company is just getting going. I mean as a symbol.
In 2012, a more minor news piece reported that Hootsuite CEO Ryan Holmes had personally sold some shares to OMERS Ventures. Not a lot, but some. This, as it turns out, was a stroke of genius from OMERS Ventures boss John Ruffolo, who explained at our Cantech Investment Conference last January that the transaction allowed for a “private IPO” of sorts, for a little breathing room that enabled the company’s founders and early employees to feel a bit of the success without selling the farm.
“If on the off-chance that we significantly fail to execute or the market changes or unforeseen circumstances happen, I have a bit of a nest-egg in terms of what I’m doing” said Holmes at the time.
This move let a nascent Hootsuite turn down offers at $40-million, $100-million and presumably more in the time since. This was different. Canadian techs aren’t supposed to stay independent. They are supposed to bow down when Silicon Valley comes calling and simply sell. Go buy a house in the Okanagan or Muskokas and hit the speaker circuit. It happened when Crystal Decisions sold to Business Objects in 2003. When Creo was acquired by Kodak the same year. And when Flickr was acquired by Yahoo in 2005.
But Holmes steadfastly maintained that he would not take this route and it turns out he wasn’t kidding. Whatever happens from this point forward, Hootsuite is a company that has not only rewarded its own shareholders and employees, but anchored an ecosystem that is now on the international radar. Soon, investors outside our borders will be learning about the companies “bubbling under” in the Vancouver tech scene and the larger Canadian stage. People in Switzerland will soon read about BuildDirect. In Brazil, they will know about Vision Critical. In Japan, they will learn about ElasticPath.
Ryan Holmes’s stubbornness, national pride and sense of the big picture has won out. “Why does Silicon Valley get to have a monopoly on innovation? Why aren’t new tech mafias springing up elsewhere? The Internet radically decentralized information and ideas. So why is startup success still confined mainly to one corner of California?,” he asked in a self-penned piece for Fortune last year. This year, we know the answer to that rhetorical question. It doesn’t. After six years, Ryan Holmes and Hootsuite have successfully created “The Maple Syrup Mafia”.