Hard Knocks: The lawyer behind some of Canada’s biggest (and quietest) deals

Mantle - Chad Bayne
Chad Bayne talks Verafin, Cognos, and Wealthsimple.

This is the second feature in our Hard Knocks series, presented by Mantle, which shares insights, war stories, and lessons learned from key players behind the scenes in Canadian tech: the ecosystem builder, the advisor, the investor, and the founder.

Not many people have behind the scenes access to Canada’s biggest tech exits and funding deals

Chad Bayne does. 

As a partner at Osler, Hoskin & Harcourt LLP’s emerging and high growth companies practice, he gets a front row seat to how these deals are really done. One of his top takeaways? That the loudest startup in the room isn’t always the one making the most progress.

“There’s not often a direct correlation between the amount of buzz in the ecosystem and the actual success of a company,” Bayne told BetaKit. “A lot of the really successful companies that we work with and I’ve worked with over the years are actually quite quiet.”

“If you want to think big, you need to get the right people around you from the outset.”

Consider Verafin, a company that, until a few years ago, was relatively obscure, quietly scaling fraud detection software out of St. John’s, Newfoundland. In 2020, Verafin was acquired by Nasdaq, Inc. for $2.75 billion in cash in one of the largest Canadian tech exits in recent memory. Bayne advised on the deal.

“For the general ecosystem, Verafin wasn’t front of mind, but there are a lot of companies in the ecosystem that are front of mind for people, and they haven’t done particularly well,” he added.

Bayne’s legal practice, now 15 years in operation, was preceded by over a decade of foundational learning. His early interest in technology began with his studies in computer engineering at the University of Waterloo, where he worked on software-hardware chip design during his co-op, and later at Newbridge Networks in Ottawa.

His attraction to the legal world was sparked by watching episodes of LA Law, leading him to pursue law at the University of Ottawa. He joined Osler in 2002 as an articling student, became an associate, and was made a partner by 2011.

Bayne said working at the intersection of law and tech was his goal before the dot-com bubble. While legal services for growing tech companies were well-established in Silicon Valley at that time, no such service was available in the Canadian market. 

Establishing one of Canada’s first tech-focused legal practices required him to develop a business model from scratch, not unlike launching a tech startup. There was a need to devise a model, iterate on it, build credibility, generate revenue, and take all the steps he said so he “could actually look my partner in the face and say, ‘yeah, this is a viable practice.’”

Bayne advised on St. John’s-based Verafin’s $2.75-billion sale to Nasdaq, Inc. (Image courtesy of Verafin)

Supporting companies with this novel service also involved making calculated decisions. “Much like a venture investor makes bets on founders when they’re making an investment, we made an investment—not through cash, but through our time. And time is the equivalent for a professional services firm,” he added.

When making decisions about which companies to support, Bayne employs a method akin to that of a venture capital investor. He evaluates the founder’s credibility and past accomplishments, and carefully assesses the potential and viability of the product they intend to develop, utilizing his technical background to inform these assessments.

“What I think about is having a practice that ultimately will survive me being at the firm.”

Building a first-of-its-kind practice was not without its challenges. The greatest of these came when Bayne’s longtime partner, Geoff Taber, tragically passed away in 2016. Taber, a key figure in the Canadian tech sector, died along with his wife and two children in a fire at their cottage on Christmas Eve.

Beyond the personal grief of losing a close colleague and friend, he described the period as “incredibly difficult, in terms of dealing with a relatively nascent practice, and having to be the only partner in Toronto.”

Despite this challenge, Bayne’s career has featured many high points, with several of his strategic bets paying off. Notable among these are his roles in IBM’s $5-billion acquisition of Ottawa-based Cognos, Hootsuite’s $165-million Series B financing, and Wealthsimple’s $750-million financing.

Bayne views his most significant achievement as building a sustainable practice that has grown to include more than 16 partners from coast to coast, and along with that, his ability to build a degree of legacy into the practice.

“I’m at a big firm that predates Confederation, and part of what I think about is having a practice that ultimately will survive me being at the firm,” he added.

Many might assume that a professional services partner like Bayne is all about handling paperwork and routine tasks. But Bayne said there’s a deeper value. A legal partner serves as an essential connector between startups and potential advisors or investors, helps address challenges before they escalate, and provides strategic advice and critical judgment that scaling companies may not realize they need.

“Ultimately, if the desire is to become a big company, you have to lay the right foundation, and you have to get the right advice. And we’re experts at helping these companies get the right foundation to set them up for scale,” he said.

“If you want to think big, you need to get the right people around you from the outset.”

Hard Knocks is presented by Mantle.

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Isabelle Kirkwood

Isabelle Kirkwood

Isabelle is a Vancouver-based writer with 5+ years of experience in communications and journalism and a lifelong passion for telling stories. For over two years, she has reported on all sides of the Canadian startup ecosystem, from landmark venture deals to public policy, telling the stories of the founders putting Canadian tech on the map.

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