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Commerce specialist Lightspeed POS raises $166M as it preps for an IPO in 2019

Commerce specialist Lightspeed POS raises $166M as it preps for an IPO in 2019
From TechCrunch - October 18, 2017

E-commerce and digitally-based financial transactions have consistently been one of the biggest and most lucrative areas of the tech world, and today a commerce startup out of Canada is laying down its claim to be among the significant players in the field.

Lightspeed POS, which provides point of sale, accounting, inventory management, purchasing analytics, and other related services to brick-and-mortar retailers, restaurants and online businesses competing with the likes of Square and Shopify, has raised $166 million in funding, a Series D that it will use to expand its business deeper into payments and new geographies. Lightspeed claims this is the largest venture round ever raised by a Canadian tech startup.

Dax Dasilva, Lightspeeds CEO and founder, told TechCrunch that he expects this to be the last round of funding before the company goes public, which he expects to happen in about 18-20 months.

We are hoping to be IPO-ready by mid-2019, he said, noting that one of the big areas Lightspeed will put this latest investment towards is building its own payment processing infrastructure, as today it works with Vantiv and Cayan to provide these services. We want to monetise that area, and that will be a huge story for Lightspeed going forward.

This latest round of funding is led by Caisse de dpt et placement du Qubec, one of Canadas largest investors, managing investments for some of the countrys largest pension and insurance funds. It put in $136 million of this investment, with iNovia Capital and Silicon Valley Bank providing the remainder. It brings the total raised to $292 million.

La Caisse is a repeat investor in the company.Two years ago, when we first invested inLightspeed, the company was already considered a Canadian leader in its field. Today, its solutions are used in more than 100 countries andLightspeedis the worlds largest company in its sector. This success is due to the impressive innovations that it implemented and the strategic vision of its experienced management team, said Christian Dub, EVP, Qubec at la Caisse in a statement. This investment is part of our commitment to provide long-term support to Qubecs new-economy companies as they grow internationally.

No valuation is being disclosed, but Dasilva said it was higher than previously and that the company remains short of the so-called unicorn mark of $1 billion. That is our ambition for when we are IPO-ready, he said, and so, too, is reaching breakeven, which Lightspeed also has not done yet while it remains in growth and reinvesting mode, he added. (We are still digging to see if we can find a valuation and will update this as and if we learn more.)

Asked about the size and timing of this round, Dasilva said that it came after several companies approached Lightspeed to acquire it. Wehad a lot of inbound interest in companies buying us,strategic companies in related industries.Thats been a decision that we had to evaluate with the board and stake holders, and the end result was to stay on its own and continue to build, hence the investment now.

To date, Lightspeed has had a strong track record that makes this a sound move. When we wrote about the companys last round of funding two years ago (a $61 million investment), the company had $10 billion of transaction volume going through its platform from 100 countries. Today, that figure is up to$15 billion annually (with the same number of countries in its footprint).

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