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Real estate information provider Real Matters Corp.The Canadian Press

Canada is set for a parade of initial public offerings by technology firms next year -- this time for real.

Real-estate data company Real Matters Inc. and marketing-software firm Vision Critical Communications Inc. are likely to lead the advance in the first half of 2017, according to people familiar with the matter. Hootsuite Media Inc. and D2L Inc., are also said to be considering IPOs in the second half, said the people, who asked not to be identified because the matter is private. The head of PointClickCare Corp. said the health care-software provider will to look at going public in 2017.

After a flood of venture capital funding and increasing hype about Canada's burgeoning tech industry in recent years, investors and industry experts had been expecting a rush of IPOs. Yet few materialized. Next year will be different for one key reason: the companies are on firmer financial footings.

"The private market was overvaluing growth at all costs where the public market really wasn't doing that," said John Ruffolo, head OMERS Ventures, a unit of the Ontario Municipal Employees Retirement System fund, which has investments in Vision Critical, Hootsuite and D2L. Companies that have stopped burning cash can now focus on sustainable growth and be ready to go public when the market conditions are ripe, he said.

Long Road

A spokesman for Markham, Ont.-based Real Matters declined to comment on its plans for an IPO. Vancouver-based Vision Critical and Hootsuite also declined to comment through their representatives. D2L Chief Executive Officer John Baker declined to speak about his timeline for going public. He said in a phone interview that the Canadian tech companies often tapped as possible IPOs were reaching maturity.

It's been a long and rocky road for the companies to get this far. There's only been two Canadian technology companies to go public with an offering of more than $100-million in recent years: Shopify Inc. in May 2015 and Kinaxis Inc. in May 2014. Shares of Ottawa-based Shopify have surged by about 135 per cent to a market value of $3.6-billion in the U.S. since their IPO while Kinaxis has risen about 375 per cent to a value of $1.5-billion, whetting investor appetite for more.

Some of the delay has been due to unfavorable market conditions, including volatile equity markets, Brexit and the U.S. election. There have only been two Canadian IPOs in the past 12 months larger than $100-million. In the U.S., several tech companies have been waiting in the wings during the election. Now that markets have stabilized, big-name companies such as Snap Inc., parent of Snapchat, Blue Apron Inc., and MuleSoft Inc. are expected to pursue share sales next year.

Snapchat filed papers with the U.S. Securities and Exchange Commission before last week's U.S. election, according to people familiar with the matter. The company is targeting a valuation of about $20-billion to $25-billion in a listing that could come as early as March.

Camera Ready

Getting the Canadian companies fit for public markets has perhaps been a bigger reason for the delays.

Real Matters, which is expected to go public in the first quarter of 2017 according to the people familiar with its plans, has been growing through acquisitions, raising private capital and using it to buy smaller firms that can help it expand. Going public would help them to further that strategy.

Vision Critical, which builds online communities for companies to interact with consumers, spun out its consulting unit so it could become a pure play technology company. It's also had disagreements at the board level over the direction it should be taking. The company is trying to sell off a stake held by former chairman Angus Reid and some of its early investors, according to people familiar with the matter. That process is expected to be completed by early 2017, opening up the potential for an IPO or a sale of the company shortly thereafter, the people said.

Social media marketing company Hootsuite and education software-maker D2L have been in the IPO pipeline for so long some began to speculate they may have missed their window. In recent years, both companies have focused on being cash-flow positive rather than demonstrating growth over profitability. In Hootsuite's case, that meant laying off almost a 10th of its 1,000 employees.

Strong Interest

D2L built out its San Francisco office and hired new executives who'd worked at large tech companies in the past, CEO Baker said. "The company's really humming on all cylinders right now,'' he said. "It's going to be a good year.''

Several late-stage private technology companies are evaluating public-market options both in Canada and the U.S., said Sanjiv Samant, group head of technology, media and telecommunications investment banking at National Bank Financial.

"With the U.S. election behind us and hopefully some increased clarity on the international front, we're becoming more optimistic about where 2017 might lead," he said. "We are confident that there is strong latent investor interest in high-quality growth opportunities."

Mississauga, Ontario-based PointClickCare, which originally filed for a dual listing in Toronto and New York in September 2015 before the market began to stumble, is one of those companies that will look at going public in 2017, CEO Mike Wessinger said in an interview at Bloomberg's Toronto office on Tuesday.

As long as the companies can keep growing and positive market conditions persist, expect IPOs to hit the market soon, with Real Matters expected to go public first, Ruffolo said. "I think we're going to finally start to see it," he said. "Fingers crossed."