For Clara Angotti and Chetan Mathur, it was business at first sight. Love came later.
They met when Mr. Mathur consulted for Ms. Angotti’s Toronto-area employer. The pair worked on the assignment, then fell in love. She joined his business. That was 28 years ago.
They’ve since built and sold two information technology consultancies. Now, the life/work partners are poised to realize their biggest success yet with their latest venture, Next Pathway Inc.
Their self-financed 70-person company, which employs two of their nephews, is no quaint mom-and-pop shop (she is president, handling legal, finances and hiring, while he is chief executive officer, managing technology and sales). It may be one of the hottest startups in Canada.
That’s because Next Pathway solves a big problem in a massive market. As enterprises move their troves of data and legacy programs from in-house data warehouses to the cloud, they hit a roadblock. All those programs are written in code that ”you can’t just copy and paste into the cloud," Ms. Angotti said. "It won’t run” on platforms organized by Google, Amazon, Microsoft and Silicon Valley upstart Snowflake Computing. It takes months for armies of coders at offshore consulting shops to rewrite the millions of lines of legacy code a program. That has limited the pace of migration to the cloud, where enterprises can generate new insights from their data to deliver more personalized services than they could before.
So Next Pathway has developed what it calls the Google Translate of the cloud business: Its Shift software automatically turns old data warehouse code into cloud code in minutes, not months. “The idea that you can actually move to the cloud in days is remarkable,” Ms. Angotti said. “We’re probably one of the best-kept secrets because we’ve just kept our heads down building.”
That’s set to change. Next Pathway, with 15 customers including three of Canada’s big banks (the company doesn’t disclose its clients), an online travel company and a U.S. retailer, is on track to generate $30-million-plus in revenue and $10-million in profit in the next year. And last month, Snowflake, a fast-growing cloud-hosting company that raised US$700-million in venture capital last year, partnered with Next Pathway to offer Shift to its clients. “They’re the most advanced, most deeply invested, most resourced company of this specialization,” Snowflake CEO Frank Slootman said. “Next Pathway has carved out a unique niche."
Ms. Angotti and Mr. Mathur are new to selling software but not dealing with big enterprises. Their first company, Sage Information Consultants, designed web service offerings for customers such as TD Waterhouse and Hewlett-Packard Co. It sold in 2000 to Envoy Communications for $35-million. Their next firm, M-Systems, helped enterprise clients build e-mail platforms; it sold to BCE in 2006 for an undisclosed sum.
The couple took two years to find their next opportunity. “To a person, [past customers said] it was all about data,” Mr. Mathur said.
Next Pathway initially helped clients aggregate, centralize and report on their data. About five years ago it began developing software to “ingest” customer data, making it easier to use by machine learning algorithms. Mr. Mathur soon realized there was an opportunity in translating legacy programs to cloud formats. “[I thought] ‘Gosh, if we could make the ‘easy button’ … we’d be onto something.”
As the company generated strong test results, it shifted focus from consulting to product. “This is one of the fastest pivots I’ve seen," said ex-OMERS Ventures CEO John Ruffolo, an adviser to the company. “They could do it because they control the whole company and could take that massive strategic bet and not worry if it causes a dip in revenues.”
Partnership talks with Snowflake arose this year when the companies found themselves pitching to the same customers. “[We thought] ‘Gee, that’s something we’d like to offer … because we’d like to solve this problem as well,” Mr. Slootman said.
The founders will determine what’s next strategically in the coming months. Cloud migration is a one-time service – “once [customers have] moved their data to the cloud our job is done,” Ms. Angotti said. But potential demand is vast and will last years, she said. “We could be an attractive acquisition [target], we could easily go public," she said. Added Mr. Mathur: “We’re just scratching the surface. This is a massive opportunity for our firm.”
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