S|W: The SaaS Weekly – Toronto trio of tech firms shed jobs a second time

Plus: Antitrust regulations dampen deals and Meta’s paying dividends.

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Toronto software companies Top Hat, Loopio, Wattpad make layoffs

Toronto-based firms Top Hat, Loopio, and Wattpad have performed their second round of downsizing in the past year, laying off six to ten percent of their staff.

Last August, BetaKit reported that Top Hat laid off 42 employees (less than 10 percent of its team). Two months earlier, Loopio cut nine percent of its staff, while back in March 2023, Wattpad laid off 42 people or 15 percent of its workforce. January 2024 has seen the most layoffs of any month since March 2023, per Layoffs.fyi.


‘You Have Blood on Your Hands’: Senators Say Tech Platforms Hurt Children

Meta’s Mark Zuckerberg, TikTok’s Shou Zi Chew, and other tech CEOs faced withering bipartisan criticism on Wednesday from senators who said social-media platforms must bear more legal liability when children are harmed online.

At one point, Sen. Josh Hawley asked Zuckerberg to apologize to parents in the audience. The Facebook founder stood, turned, and said: “I’m sorry for everything that you have all gone through. It’s terrible. No one should have to go through the things that your families have.”

(The Wall Street Journal)

SumoQuote acquired by Utah-based roofing software firm JobNimbus

Calgary-based SumoQuote, which develops sales software for contractors, has been acquired by Utah-based roofing software company JobNimbus for an undisclosed amount.

SumoQuote will continue to run out of its Calgary office and its employees have been brought into the JobNimbus team and placed into their original departments. SumoQuote CEO Ryan Shantz has transitioned into a new role. JobNimbus said the acquisition is aimed to make JobNimbus “the industry-leading sales-centric customer relationship management solution.”


US Tech Giants Have Scuttled Over $70B In M&A Deals Following EU, UK Pushback

Lately, it seems like a lot of large technology acquisitions have fallen apart following pushback from European and U.K. antitrust regulators. In tandem, the value of these deals that didn’t get done continues to mount.

More than $70 billion worth of planned acquisitions by American technology companies have not come to fruition following scrutiny and objections from EU and U.K. antitrust authorities.

In related news: Adobe will end its effort to create a web design product to rival Figma Inc. after the collapse of its proposed $20 billion acquisition of the startup.


Inovia report says Canadian software sector is returning to normal

Venture capital funding across the Canadian software sector is now seeing a return to normal after a challenging two years, signalling the start of a promising new phase, according to a new report from Inovia Capital.

The report found that SaaS free cash flow margins are also up 10 percent since before the 2021 VC boom. This, coupled with historically low valuations, suggests a sector primed for a cash influx.


Meta plans US$50 billion buyback in effort to win over investors

Meta Platforms Inc. announced plans to buy back an additional US$50 billion in shares and issue its first-ever quarterly dividend as Chief Executive Officer Mark Zuckerberg works to convince investors that his costly bets on the metaverse and artificial intelligence will pay off.

The social media giant also reported strong fourth-quarter results, posting a 25 per cent gain in sales and profits that tripled, while also projecting revenue growth for the current period that surpassed projections.

(BNN Bloomberg)

Amid rising business costs, GoDaddy’s Young Lee shares how Canadian companies can keep them in check

The cost of doing business in Canada is rising, and compounding this problem is a wave of hidden costs that often elude initial budgeting and catch entrepreneurs and small businesses by surprise.

As Young Lee, Canada market and growth lead at GoDaddy puts it, “Canadian small businesses are stretched thinner than ever, particularly when it comes to their finances.”

As business costs continue to rise, Lee talked to BetaKit about how Canadian small business owners can keep expenses in check.


Palisade closes $1.5 million CAD, launches email deliverability score tool

Montréal-based email startup Palisade has closed $1.5 million CAD in pre-seed financing as it publicly launches its email deliverability product.

Founded in 2023, Palisade is looking to tackle email deliverability for companies with email lists. Email deliverability refers to the rate at which emails successfully make it to recipients’ inboxes. This rate can be lower if an email bounces back or is filtered into a spam folder, which Palisade said can lead to revenue loss.


Google’s Parent Company Squeezes Its Moonshot Projects, ‘Other Bets’

Alphabet, the parent company of Google, is cutting back its commitment to ambitious moonshot projects.

Company executives have told staffers at the X unit, which converts promising investment projects into full-fledged subsidiaries, known as Other Bets, that no such conversions will happen this year.

The Other Bets group has collectively lost $37.6 billion since the Alphabet project began in 2015. And none appears to be close to turning a profit.

(The Information)

Workspace analytics startup Relogix acquired by HubStar

Ottawa-based workplace analytics startup Relogix has been acquired by London and Marlborough, Mass HubStar for an undisclosed amount.

The deal is aimed at combining HubStar’s analytics capabilities and deep learning technology with Relogix’s analytics platform, Conexus. HubStar said the acquisition is hoped to make HubStar a leader in AI-powered workplace utilization intelligence.


Okta lays off 400 employees — almost exactly a year after last staff cuts

U.S. access and identity management giant Okta has said it is laying off approximately 400 employees, or 7 percent of its global workforce.

The layoffs come almost exactly a year to the day after Okta announced plans to reduce its workforce by 5 percent, about 300 employees.

Okta, which counts more than 18,000 customers, posted better-than-expected quarterly earnings in November, with revenue increasing 21% to $584 million.


Feds finally launches consultations on SR&ED modernization

As promised late last month, the federal government has now launched consultations on its Scientific Research and Experimental Development (SR&ED) tax incentive program.

The Department of Finance is seeking feedback on how to modernize and improve SR&ED in “cost-neutral ways” and the suitability of adopting a patent box regime by April 15, as it considers whether to give firms that develop and keep IP in Canada a tax break on sales of their inventions globally.


Alt Capital Raises $150 Million Fund, Extending Altman Brothers’ Funding Spree

Sam Altman’s younger brother Jack has raised a $150 million venture fund to invest in early-stage startups through his VC firm Alt Capital, the younger Altman said in an interview. The fund plans to lead or co-lead investments in startups right after they incorporate, with a focus on enterprise software, including artificial intelligence startups.

(The Information)

Sports content startup STN Video acquired by Minute Media

Victoria-based STN Video has been acquired by technology and sports content company Minute Media for an undisclosed amount.

Founded in 2010 as SendtoNews, the company offers an online video platform that includes content from major sports leagues and allows publishers to embed code on their website, with relevant video content instantly matched and populated within their articles at no cost.


Alex Riehl

Alex Riehl

Alex Riehl is a staff writer and newsletter curator at BetaKit with a Bachelor of Journalism from Carleton University. He's interested in tech, gaming, and sports. You can find out more about him at alexriehl.com or @RiehlAlex99 on Twitter.

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