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Klue, co-founded by chief executive officer Jason Smith and chief technology officer Sarathy Naicker, has tripled its customer count since raising US$15-million in the summer of 2020 to more than 300 clients.NELSON MOUELLIC/Courtesy of manufacturer

U.S. private-capital giant Tiger Global Management has pounced on another Canadian startup, making at least its seventh investment here this year and extending a banner year for B.C. technology companies.

Tiger’s latest deal is a US$62-million venture capital funding of Vancouver’s Klue Labs Inc. It’s the third transaction Tiger has led or co-led in Canada this fall, along with deals for Float Financial Solutions and Get ResQ Ltd.

Klue sells artificial intelligence-powered business intelligence software for sales professionals to gather information on competitors, better equipping them to win deals. Its platform, which automatically draws in information from the internet as well as internal systems such as Slack and e-mail, competes in a new category known as “competitive enablement.” Klue’s customers include Dell, Red Hat, SAP, Workday, 3M and Shopify. Its rival is Boston startup Crayon Inc., which raised US$22-million in venture capital this year.

Klue, co-founded by chief executive officer Jason Smith and chief technology officer Sarathy Naicker, has tripled its customer count since raising US$15-million in the summer of 2020 to more than 300 clients. It ranked 12th on Deloitte’s latest list of fastest-growing Canadian technology companies, with 2,418-per-cent revenue growth from 2017 to 2020. Yearly revenue has surpassed US$10-million.

Klue has tripled its head count since the start of the pandemic, to 142 employees, and plans to double that again with the funding as it looks to expand sales to Europe and the Asia-Pacific region.

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Several of Klue’s past investors said that nabbing Tiger as a funder effectively anoints it as an early winner in the space, even as it crowded them out from investing in the latest deal. (Mr. Smith did get Salesforce Ventures to participate as a strategic investor after Tiger offered to bankroll the full round.)

“It’s proof that Jason is winning this market,” said Lars Leckie, managing director with Aspenwood Ventures in San Francisco, which backed Klue in 2020. “It’s a recognition that he is on that path and gives him the capital to fully execute on that plan.”

New York-based Tiger is renowned for doing extensive advance research work on fast-growing startups it wants to back, then leaping at the opportunity to invest, typically reaching out even before they seek financing. Tiger offers “founder-friendly” terms to those it believes can emerge into market leaders, including big dollars at rich valuations, fast-closing times, and no request for board seats or other conditions usually demanded by venture capitalists. While many VC firms have teams to help portfolio companies with strategy, recruiting and other initiatives, Tiger outsources those functions to consulting and headhunting firms and sticks to investing.

“They find who they believe is the category winner, they back them aggressively with the funding to separate themselves from the pack, and they get out of the way,” Mr. Smith said in an interview. “They are prowling for the right deals that are going to be outsized market returns, but move extremely quickly.”

With funding flowing into technology companies globally, Tiger is also putting upward pressure on technology worker pay at a time of rising inflation, Mr. Smith acknowledged. ”There’s a lot of money out there,” he said. “It’s increasing the balance sheets of companies quickly, and people are going to get paid more. … We’ll look to hire another 150 people. They’re all gainfully employed elsewhere. I think it will contribute to wage inflation, which will make it harder on some of the smaller companies ... but we’re also competing with the Amazons and Netflixes of the world.”

The Klue raise extends a record year for Canadian startups. According to Refinitiv, Canadian companies have raised $12.4-billion in venture capital so far this year, close to 25 per cent above the previous full-year record, adjusted for inflation, set in 2020.

The deal, along with funding announced Tuesday for B.C. fusion energy developer General Fusion, also extends a banner year for B.C. companies. Several, including Blockstream, GeoComply, Dapper Labs, Trulioo and Clio have reached “unicorn” status by achieving valuations of US$1-billion while four B.C. technology companies – MDA, Telus International, Copperleaf Technologies and Thinkific Inc. – have gone public on the Toronto Stock Exchange.

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