A lingering sense of sorrow over the terrorist attacks in the United States has led consulting firm Deloitte & Touche to cancel its annual celebration of Canada’s fastest-growing technology companies.
The 2001 Canadian Technology Fast 50 awards gala was scheduled to get underway Thursday night at the recently-opened Liberty Grand Entertainment Complex in Toronto.
“We just didn’t think it was an appropriate time to have a gala celebration,” said Garry Foster, national director of technology and communications at Deloitte & Touche. “We went back to our sponsors and they were okay with it; we asked some of our Fast 50 companies and they were okay with it. We’re going to give the money (from the ticket sales) to the relief fund, which is probably a better use of the money.”
Despite the cancelled ceremony, Deloitte & Touche went ahead and released the results Thursday morning.
Last year’s second-place winner, Stratos Global Corp., took this year’s top honors after posting more than 70,000 per cent revenue growth between 1996 and 2000. Pivotal Corp. slipped down the list somewhat at more than 14,000 per cent revenue growth in the same period.
“There’s been a strong focus on organic growth,” said Jim Parm, Stratos’ chief operating officer, adding that acquisitions have also played an important role in the company’s development. “Obviously the market space has been depressed from a market capitalization perspective, so we could see some further consolidation.”
Foster said Stratos was a good example of the sort of firm that will probably be able to weather the IT market downturn.
“As much as the industry is a little bit soft, they have a niche,” he said. “They’re sowing up the satellite communications marketplace. While they have competitors, they’re one of the leading competitors in that space. One of the things I think that really does come from this is that if you can have a niche market and be one of the leading providers in that niche market, you can be really successful.”
Some companies may be growing too fast for their own good. Though Deloitte & Touche is making note of the fact that 2001 represents the first year Eastern Canadian firms made the ranking, one of the two companies, Knowledge House Inc., ceased operations late last week.
“The company is obviously growing quickly — or had been growing quickly,” he said. “(For) companies like Knowledge House, part of the problem they’re facing in this economy is that fast-growing companies also need capital to keep growing and sustaining their growth to hit a level of profitability. I think what basically happened with Knowledge House . . . they basically burned through all their cash and couldn’t get any more financing.”
Given the current state of the market, Foster said the ranking gives the firms some much-needed recognition.
“Any kind of positive recognition you can get in this type of marketplace is probably going to help you,” he said. “Once they kind of have a Fast 50 stamp, some of the VCs start to look at them. There’s some that they may not have seen before.”
Parm said the attention reinforces the company’s corporate image.
“It fits our style as a high-growth, very entrepreneurial company,” he said. “It certainly validates what we see ourselves as.”