September 28, 2010
Deloitte Canada names Technology Fast 50
Companies' revenue growth takes off in 2010
The winners of the Deloitte Technology Fast 50 TM set a record pace in 2010, with an average five-year revenue growth rate of 5,638 per cent, an all time high. Some of this was due to the economic rebound and exciting new technology niches, but some was also due to the small size of these companies five years ago. In addition, this year’s survey of Canada’s fastest growing technology companies reveals a domestic tech sector that’s been resourceful in bootstrapping its growth, but sees the country’s domestic venture capital industry as in crisis and potentially unable to help sustain future expansion. “Canada’s tech companies set records for growth in 2010: both the top five companies and the entire Fast 50 roster were at all time highs for five-year growth at almost 43,000 per cent and 5,600 per cent respectively," said John Ruffolo, National Leader, Technology, Media & Telecommunications Industry Group, Deloitte.
"While we take time to celebrate the winning companies' achievement, we also need to keep in mind that this year's winners have grown off very small bases and tend to be successful in what are relatively smaller technology niches.”
“Over the last twelve years, there have been some interesting trends (and non-trends) within the Fast 50 list,” said Duncan Stewart, Director of Research for Technology, Media & Telecommunications for Deloitte. “Although the growth rate and the winners change over time, the split between hardware, software, telecom and other technology areas has been fairly consistent. Equally, the regional split of winners hasn’t varied: ten years ago 26 of our winners were from Ontario, and in 2010 we have 27 Ontario winners. On the other hand, reflecting a difficult time for IPOs and the ongoing venture capital crisis, the number of winners who are public companies has fallen from 54 per cent a decade ago to 30 per cent today. Turnover is up too – the five fastest growing companies on this year’s list weren’t even on the 2009 list.”
Richmond Hill-based Clickfree (Storage Appliance Corp), a hardware company specializing in automatic computer backup, has emerged as a strong winner: sitting atop the ranking of this year’s Fast 50 list with a 64,240 per cent five-year revenue growth.
Second and third spots go to Real Matters (40,532 per cent, a Markham-based software company operating in property information solutions, and Varicent Software Incorporated (40,269 per cent), a Toronto-based sales performance management software firm. Rounding out the top five are Toronto-based NexJ Systems (36,128 per cent), an Enterprise CRM Software company, and Avigilon (33,664 per cent), a Vancouver-based high-definition surveillance company.
As happened in 2009, a Québec GreenTech company is a winner in multiple categories: Montreal-based 5N Plus Inc. appears on the Fast 50 list and it is present on both the Green technology and the Leadership rankings as well.
Economic conditions provide both good and bad news
According to survey results, 73 per cent of Tech CEOs said their company’s performance was negatively affected to some extent by the recent recession. At the same time, 68 per cent predict either weak or negative growth over the next 12 months.
On the job front, more than 53 per cent of CEOs indicate their firms have benefitted from current conditions thanks to the greater availability of skilled labour at a reasonable cost.
Leadership Awards single out companies that are the elite members of the Canadian technology industry, whose ability to create a distinct competitive advantage in a high-growth market allows them to dominate their sector and quickly join the ranks of other Canadian global leaders. This year’s four Leadership Awards recipients are: 5N Plus Inc., a Montreal, Québec-based high-purity metals and compounds company; Burlington, Ontario-based Evertz Technologies Limited, an HDTV infrastructure company that is back on the list for a second consecutive year; Open Text Corporation, a Waterloo, Ontario-based enterprise content management company; and Waterloo, Ontario-based Research In Motion, Canada’s globally recognized wireless Smartphone manufacturer which has made the Fast 50 ranking every year since the creation of the awards in 1998.
The Deloitte Technology Fast 50™, the Companies-to-Watch (CTW) Awards honour early-stage Canadian technology companies who have been in business less than five years, and have the potential to be future Deloitte Technology Fast 50™ winners. The ten companies recognized as CTW this year are: Awasi Incorporated (Waterloo, ON), Dayforce (Toronto, ON), Morega Systems Inc. (Mississauga, ON), N4 Systems (Toronto, ON), Neuralitic (Montreal, QC), Polar Mobile (Toronto, ON), Syncapse (Toronto, ON), Telepin software (Ottawa, ON), Tynt Multimedia Inc. (Calgary, AB), and X20 Media (Montreal, QC).