Vancouver-based Topicflow has secured $2.5 million CAD ($1.825 million USD) in seed funding for its AI-powered performance management platform.
CEO Amin Palizban said “Topicflow is AI-native and built for the post-chatGPT era.”
The all-equity round was led by Founders’ Co-op with participation from Ascend, two Seattle-based venture capital (VC) firms, and three undisclosed investors, none of whom are Canadian. Topicflow says the capital will be used to double its team from five to 10 employees as it embarks on its goal of hitting $1 million in annual recurring revenue within 12 to 18 months.
Topicflow was founded by CEO Amin Palizban, CTO Tony Angerilli, developer Maxime Parmentier, all of which held those same positions at performance management software startup 7Geese, and Gavin Johnston, who was an account executive at 7Geese. Paycor, a human capital management firm based in the United States, acquired 7Geese for an undisclosed amount in 2020.
With the $550,000 CAD the founders invested to get the company started, Topicflow has raised just over $3 million to date. Palizban said that it helps to be working with the same team from a previous startup since they know each others’ working styles and there is less risk of the team “falling apart.”
Topicflow says its AI capabilities can analyze meeting transcripts, organization goals, key performance indicators (KPIs), and work activities from other systems. The platform can “nudge” managers to set performance expectations, address performance risks, coach employees, and gather peer feedback.
When asked what sets Topicflow apart from 7Geese, Palizban said it’s “AI-native and built for the post-ChatGPT era.”
“Modern performance management systems have been combining performance reviews with continuous coaching, which has been a step in the right direction; but now with AI, we can finally move away from the archaic performance reviews process,” Palizban said in a statement.
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Topicflow says it can integrate with human resources information systems, communication tools like Slack and Microsoft Teams, and work-management tools like Jira, Asana, and Salesforce.
While Palizban told BetaKit that putting together the round was “easy,” and only took a few weeks because of the founding team’s experience and successful exit, it wasn’t thanks to potential Canadian investors. He said potential Canadian backers believed Topicflow was too early for fundraising, complicated the deal with multiple follow-up meetings and terms, and diminished his confidence to the point he thought of shutting down the business before turning to US-based investors.
South of the border, he said, the difference was “night and day.” His first investor had a faster turnaround, did not try to negotiate specific terms, and even introduced him to other investors that joined in the following week.
“If I had known this, I would have not talked to any Canadian investors,” Palizban said.
“Canadian VCs want very safe investments with very good deal terms and complicated deal structures,” he added. “They claim to want to do seed or pre-seed investments but in reality, they keep saying you are too early and want traction. It’s a paradox.”
UPDATE (06/28/24): This story has been updated with additional commentary from Topicflow CEO Amin Palizban
Feature image courtesy Gavin Johnston via LinkedIn.