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Dan Park, CEO of Technologies Inc.Sean Silcoff

A Vancouver e-commerce company that filed for creditor protection last fall is seeking a second chance, backed with fresh money from a Silicon Valley venture-capital firm and a new strategy drawn up by a former Inc. executive.

Creditors of Technologies Inc. have been called to a meeting on March 12 to vote on a "plan of compromise and arrangement" under the Companies' Creditors Arrangement Act (CCAA) that would see the company receive an infusion of capital and eliminate the vast majority of its debt.

One of Vancouver's most prominent private technology firms, BuildDirect has raised more than $100-million in venture financing since its start in 1999. But the company, which matches buyers and sellers of heavyweight construction goods and handles delivery logistics across North America, undertook a risky expansion plan that involved an overhaul of its online platform and the use of artificial-intelligence technology to make it easier for suppliers to manage sales. Management had hoped the new technology would give it a powerful way of generating data and analytics from its business, but the roll out was marred by snags that negatively impacted sales.

The company continued to lose money and struggled to raise needed venture funding in 2017 before former chief executive Jeff Booth departed and it filed for creditor protection.

"I feel really good about the progress we're making … and I'm really bullish for the path ahead," said CEO Dan Park, a former Amazon executive who took over from Mr. Booth, just a few weeks after joining BuildDirect as its chief operating officer.

Mr. Booth had hoped to turn BuildDirect into the Amazon of heavy-duty home-improvement supplies, but Mr. Park said the company will shift its focus "materially" toward serving contractors and away from do-it-yourself customers.

Contractors accounted for more than 20 per cent of BuildDirect sales but are far more attractive customers because they buy several times a year, over multiple years, and spend much more per order than DIY consumers, said Mr. Park. "It just far outweighs what a consumer spends. We're doubling down in this area, which is resonating well with suppliers and investors. As a startup, we want to make sure when we get financing we focus on things that will drive revenues and do it in the most efficient way possible."

Under the proposed financing, Silicon Valley venture-capital firm Mohr Davidow Ventures, a past BuildDirect backer, would commit $10-million in fresh funds while lenders who have committed $15-million in financing to carry the company through the restructuring would convert most of that into equity. Investment bank Canaccord Genuity is looking to raise another $16-million to $25-million from other investors.

The combined equity investment of up to $48.5-million would value the firm at $65-million before the cash infusion.

If the refinancing is completed, it would put BuildDirect in rare company, as many e-commerce companies have faced increasing challenges of late competing with the Amazon juggernaut and justifying high marketing costs on such platforms as Google to generate sales. As a result, e-commerce companies have fallen out of favour with venture capitalists.

BuildDirect is offering an incentive of sorts to past investors: If they participate in the refinancing, they will receive some value for their equity as their old shares are exchanged for new shares on a pro-rata basis. However, those who do not participate will see their past investment wiped out, according to documents filed with the B.C. Supreme Court. The monitor said in a report "significant progress has been made and detailed discussions are ongoing with certain qualified investors contemplating significant investments."

"The process is moving along as expected and I feel very good about where we'll end up," Mr. Park said.

Part of the confidence is due to the company's performance under his watch. Since Nov. 1, the company has delivered slightly higher revenues ($13-million) and lower operating costs ($10.4-million) than forecast in what is a seasonally low period for construction, while renegotiating terms with its key suppliers. As a result, its cash flow and cash position are better than expected.