Kangarootime leaders laid out a roadmap for the future last year.
The childcare industry was consolidating quickly, but it was severely underserved by enterprise software that could help manage the business across multiple sites.
K2 – as Kangarootime dubbed its latest software version – debuted earlier this year to meet that challenge.
Company founder and CEO Scott Wayman said revenue is up 300% this year. He said the pipeline suggests revenue will increase by 500% next year.
That’s the kind of momentum that allowed Kangarootime to close a $6 million funding round recently, led by existing investor Cultivation Capital (out of St. Louis) and contributions from Motivate Capital, a Chicago-based fund co-managed by Western New York native Lauren DeLuca.
“We have brought on subject matter experts and taken on an approach to design that is helping us build really beautiful things that can help our customers at scale,” Wayman said. “The market has just not given them options and we feel like we’re there to stand up for them and build something special for them.”
The round is an extension of Series A funding Kangarootime raised two years ago, with a significant multiple on the original valuation. Wayman said he opted temporarily against raising a larger round of Series B funding, given how much growth is being realized.
Kangarootime moved to Buffalo in December 2017 after winning an award in the 43North business competition – this year’s 43North finale is being held this week. 43North invested $300,000 in follow-on funding into Kangarootime earlier this year, and that money was included in the latest round.
Kangarootime now has about 40 employees, and Wayman said the plan is to be approaching 100 workers by the end of 2022. The company is actively building out its sales, implementation and engineering teams.
Wayman has looked to the Buffalo business community for leaders within the company. Bob Willer, an early employee and longtime technology leader at Campus Labs, joined in March as chief technology officer. Another former Campus Labs employee, Kelly Ormsby, joined in May and will lead the build out of an enterprise implementation team. David Gonzalez, hired away from M&T Bank in 2019, now serves as vice president of operations.
Wayman said Kangarootime came to Buffalo big on potential but short on cash. The competition was a lifeline as Wayman figured out how to build a capital-efficient software firm “on behalf of our customers and on behalf of surviving long enough to build something really beautiful and generational.”
Kangarootime has figured out the key to product-market fit and scale, and will now focus on capturing as much market share as possible while providing new customers with top-of-the-line service, Wayman said. In the process, it has unlocked new horizons that will power the company forward for years.
“We wanted to stay super focused on the early education mission that we have started and where we’re already growing internationally,” he said. “But we feel like are well positioned to participate in the $540 billion-a-year care economy, which doesn’t only include childcare but other stages of life as well."
Kangarootime is the 28th local company to acknowledge growth-oriented financing this year. The others include Jerry ($103 million), Squire ($60 million), Centivo ($51 million), Tackle.io ($35 million), Torch Labs ($25 million), CleanFiber ($11.9 million), Circuit Clinical ($7.5 million), SomaDetect ($6 million), Kickfurther ($5.9 million), HELIXintel ($1.6 million), Joblio ($4 million), Verivend ($2.5 million) Ognomy ($1.37 million), Patient Pattern ($1.2 million), Ellicottville Greens ($1 million), Immersed Games ($540,000), Braid Babes ($415,000), MemoryFox ($380,000), Zizo Technologies ($200,000), Thimble.io ($125,000), AirExpert ($100,000), Immunaeon ($100,000), Oro Sports ($100,000), Real Talk ($100,000), Alo ($100,000), HiOperator (undisclosed) and Classavo (undisclosed).
