- Sale allows firm to focus on its subcription software product
- Company was said to consider the unit sale as early as August
Vision Critical Communications Inc. sold its marketing consulting business to research firm Maru Group, a move that focuses it on software ahead of a potential initial public offering.
The Vancouver-based company provides software to help clients including Nascar and Banana Republic build communities of customers they can tap for feedback on new products and approaches. Backed by Angus Reid, one of Canada’s leading social researchers, the firm has also included a consulting arm to help clients use those insights to build marketing campaigns.
Spinning off the consulting business lets the company focus solely on the software platform, Chief Executive Officer Scott Miller said in an interview. About 160 of the roughly 800 employees are leaving the company as part of the sale and Vision Critical is retaining a revenue-sharing agreement with Maru Group, Miller said. The company declined to say how much it sold the unit for.
“We’re being pushed by our customers to do more and more with our platform,” he said. “In order to continue to meet that demand, quite frankly we couldn’t come up with enough time and focus and investment dollars.” Vision Critical’s 2015 revenue was more than C$100 million ($72 million), Miller said.
Vision Critical was said to weigh the sale of the consulting business as early as August 2015, according to people familiar with the process.
Miller declined to commit to a specific timeline for an IPO but said if the company was ready and an opportunity requiring “sizable” investment presented itself, he would take the firm public.
The North American IPO market has dried up amid one of the worst starts to a year for global equities on record. Not a single company went public in the U.S. in January, the worst month since the financial crisis, and Canada had the worst start to the year for IPOs in at least two decades.
“We are not far from being ready if the marketplace and the customer opportunities and the strategic opportunity presents itself,” Miller said.
(An earlier version was corrected to show Angus Reid wasn’t a founder of Vision Critical.)