Ottawa-based Solink has closed $60 million USD in Series C funding to scale its video surveillance software globally.
In an interview with BetaKit, Solink co-founder and CEO Michael Matta said he believes that now is the time for Solink to invest in growth, citing increased demand for Solink’s platform amid the downturn and a broader shift in the video surveillance market away from on-premise technology toward cloud solutions.
After taking stock of market conditions and seeing “a lot of inbound interest” from prospective investors, Solink co-founder and CEO Michael Matta saw an opportunity to “really scale” the company’s business.
“At the end of the day, this is a market that is changing,” said Matta. “I believe that the winners that are there today in the security space are not going to be the same people five years from now, and I think there’s an opportunity for us to establish ourselves as a leader.”
Solink’s all-equity Series C round was led by a new investor—Goldman Sachs Asset Management’s Growth Equity business—with follow-on participation from existing Solink backers OMERS Ventures, BDC Capital’s Information Technology Venture Fund and ScaleUp Ventures. The financing, which closed earlier this month, brings Solink’s total funding to $90 million USD.
In commercial settings, security cameras are pervasive, but many of them are only available on-site because they are not connected to the cloud. “They’re not smart, intelligent cameras that can drive insights and analytics to the business owner,” OMERS Ventures partner Laura Lenz told BetaKit in an interview.
Enter Solink, which sells subscription-based software that Lenz said does just that in a “seamless, easy-to-use way.” The startup’s platform makes existing security cameras accessible remotely via the cloud, pairing footage with point-of-sale data and making it searchable by event. Solink’s camera-agnostic software provides businesses with secure, real-time access to video, leveraging artificial intelligence (AI) to quickly identify trends, flag suspicious behaviour, such as thieves, and improve their operations.
The company caters to a wide range of industries: restaurants; retailers; financial, education, and healthcare institutions; and hospitality, manufacturing, logistics, and property management companies. Solink serves 18,000 customer locations across 15 countries, with a list of clients that includes Tim Hortons, The Container Store, and the PGA Tour Superstore. When Solink closed its OMERS Ventures-led Series B round in 2020, it had about 50,000 cameras under management; today, it has around 300,000.
RELATED: Video surveillance software startup Solink raises $23 million CAD Series B round
According to Matta, Solink’s latest round was a “very clean deal with clean terms.” The CEO declined to disclose Solink’s valuation as part of its latest financing but claimed that it came at a higher valuation than Solink’s Series B round. Matta acknowledged that the Series C round also involved “a bit of secondary capital,” but declined to disclose the amount, noting only that some early Solink investors took chips off the table but remain Solink shareholders.
While cloud tech has become “table stakes” across many industries and verticals, within the security space, Matta claimed that it remains “very early innings,” as only a small percentage of security products today are cloud-based. According to the CEO, legacy on-premise video surveillance tech providers, which sell hardware and software to businesses as a one-time offering, currently hold about 95 percent of the market.
But research indicates that demand for cloud-based solutions like Solink is growing. Per a recent report from market research firm Novaira Insights, global video surveillance overall is growing, and the cloud-based video-surveillance-as-a-service (VSaaS) space in particular is one of the market’s highest-growth categories. Novaira reports that last year, the installed base of cloud-connected cameras grew by about 80 percent, as VSaaS revenue gobbled up a larger share of the overall market from on-premise providers.
Novaira forecasts that over the next few years, the number of cloud-connected cameras will continue to grow at an average annual rate of more than 80 percent. While Matta declined to disclose Solink’s revenue, the CEO claimed that the company’s growth has been “roughly on track” with the pace of the VSaaS market.
“Physical security is essential to managing the operations and profitability of most enterprises and small businesses globally,” Mike Reilly, vice president of Goldman’s Growth Equity business, said in a statement. “After conducting a deep dive in the physical security and VSaaS space, our team identified Solink as the up-and-coming leader in a market undergoing a rapid transition to the cloud and modernized solutions.”
Goldman’s investment comes through its recently launched $5.2 billion USD growth equity fund, which buys minority stakes in high-growth businesses with strong market positioning globally through average investments of $50 million. Reilly, who is joining Solink’s board as part of the round, declined to speak with BetaKit for this story, noting that Goldman does not permit media interviews regarding its investments.
Over the past few years, Solink has expanded into new verticals and geographic regions, and launched new products.
Amid an economic downturn, Matta claims that Solink has experienced growing demand for its tech. “The market is usually anti-correlated with risk and security and crime in general, and so we’ve seen a big jump in the need for our products and giving businesses the ability to optimize profitability and minimize their losses and shrink,” he added.
Speaking to the loss-prevention component of Solink’s value proposition, Lenz described Solink’s platform as a “need-to-have solution in a recessionary environment.”
Solink avoided fundraising during the height of the venture capital (VC) market in 2021 and 2022. “We’ve always been really disciplined about how we run the business and how we scale,” Matta said. “We’ve always seen really strong growth numbers, but we’ve been able to manage it on the balance sheet.”
That approach has helped Solink avoid layoffs and close a sizeable up round as many other Canadian tech startups have struggled to fundraise and shed staff. “This is a very consistent, predictable revenue growth [company] that’s been capital-efficient, [and] knows how to build a successful business whether they take VC money or not,” said Lenz.
“This is a very consistent, predictable revenue growth [company] that’s been capital-efficient, [and] knows how to build a successful business whether they take VC money or not.”
– Laura Lenz, OMERS
According to Matta, Solink was not actively fundraising and had no need for more capital at this time. But after taking stock of market conditions and seeing “a lot of inbound interest” from prospective investors, Matta said Solink realized it had an opportunity to “really scale.”
Solink’s plans on this front involve investing in product development, including AI-native products, and its go-to-market efforts, as the company looks to add more customers in new and existing verticals and geographic markets while leaning on Goldman’s vast network. To help kick things off, Solink recently opened an office in the United Kingdom.
For his part, Matta expects vision technology to play a bigger role in the physical world in the future. Over the longer term, he sees room for Solink to become a “core vision platform” upon which other vendors can build products, describing this as a “second-order priority.”
As Solink looks to displace legacy providers while fending off fellow cloud-based competitors and new entrants alike, Solink’s CEO is betting that the firm’s nimble, cloud-native approach and emphasis on customer service will help the startup become a global leader within the increasingly cloud-based security and video surveillance space.
Feature image courtesy Solink.