In an interview with DC Inno, CEO James Quigley confirmed what was shown in an SEC form filed earlier this month: Canvas, a Reston, Va.-based B2B enterprise software company focused on remote business applications, has raised a $4 million bridge round led by return backers Osage Venture Partners and River Cities Capital Funds.
The decision to raise new funding comes as Canvas hopes to overcome several "hurdles," thereby growing its valuation, before it approaches a much larger, growth-stage raise between October of this year and March 2017, Quigley said. Meanwhile, Canvas is also among the finalists for our 2016 Tech Madness competition.
The fundraising round remains open with $1 million uncommitted, totaling a $5 million equity offering, Quigley explained, leaving space for the possibility of participation from an unnamed strategic investor/partner.
Looking forward, Quigley said the eventual growth-stage raise would bring roughly $15 million to $25 million to the company for expansion efforts.
But those "hurdles" that Quigley first described may be better defined as benchmarks, as they include: an annual reoccurring revenue (ARR) in excess of $10 million, another 80 to 120 percent growth year in terms of both revenue and customer count, maintaining a healthy customer churn rate through 2016 and continuing to create a more comprehensive product suite for clients to leverage so that they can interact in new and interactive ways with their own customers.
"We decided to raise just enough capital to blow past these marks," Quigley explained regarding the raise.
For reference, Canvas boasts roughly 55,000 paid subscribers in 5,000 accounts across 31 different verticals, globally. About 7 of those industries account for 75 percent of Canvas' revenue, they include manufacturing, professional services, contracting and construction, among others.
Interestingly, about 27 percent of Canvas' accounts are from customers based outside of the U.S., and that number is steadily growing, said Quigley.
Canvas will also soon launch Canvas 8, which will be the newest version of the company's flagship software suite, Quigley said.
The platform offers a product that not only digitizes paper documents, cutting on waste, but also adds a layer of business intelligence analytics to customer's operations. With Canvas 8, a business can interact with its clients by providing a receipt of services that offers, for example, additional support information, social media accounts and photos detailing the completed job. The business is structured through the sale of numerous SaaS enterprise applications that are then paid for via a subscription model.
"We had a really good year last year. I feel like we're one of best kept secrets around here. And it's probably because were admittedly terrible at self promotion," Quigley told DC Inno.
In 2015, Canvas experienced 80 percent growth year-over-year. Now, Quigley and co. are focused on keeping momentum.
