Wellington Financial Fund III portfolio co. Wmode acquired by Silicon Valley-based AppDirect

I must admit that October 2006 seems like a long time ago.

That was the month we closed a $5.5 million financing for Calgary’s Wmode, our third financing in a fund that was just a few weeks old at that point. We went on to complete 50 different financings in Wellington Financial Fund III, and the fact that several members of that cohort have been acquired in the space of the past few months (Softgate, Bluestreak and InterAct911) speaks to the energy and focus that their management teams have brought to bear over a considerable period of time.

Wmode is a leading technology and service company in the connected device, mobile and app-ecosystem sector. Wmode operates a comprehensive suite of managed services for the recruitment, development, management, discovery, delivery and payment of mobile apps, content, and consumer services. Clients include large telecommunication device manufacturers and enterprises.

There aren’t enough tech investors in Calgary, and one can hope that this successful exit will encourage other Angels and institutions to invest in the local innovation economy. Wmode was able to productively and cost-effectively use our fund’s capital for almost 6 straight years, and our True Growth Capital will always be substantially cheaper than either the cost of equity, or the implied 20%+ IRR of a royalty financing, for example. But that doesn’t mean we don’t need VCs and other equity partners.

They Silicon Valley-based buyer in question is backed by VCs from both sides of the border. Although the deal was signed last summer, it only became public a few days ago.

The folks over at Grenville Royalty Corp. came on to the Wmode scene in November 2013, and announced their return on Wmode under the guise of the company bringing in “new investors”. Since we backed the management team 7 years prior to this particular royalty financing, long before it was EBITDA positive, I thought it would only be fair for us to round out the story.

Congrats to Bert Bertolin (CEO), Bob Woodward (CFO) and the Wmode investor base. You did it!

MRM