BuildDirect, a Vancouver-based online wholesaler of building products, announced that it has raised $4 MM from BDC Venture Capital. The company had recently raised $16 MM from OMERS Ventures in June.
BuildDirect.com, North America’s largest online destination for heavy weight building materials including flooring and decking, announced today a $4 million investment from BDC IT Venture Fund. This secondary investment brings the total amount raised from $16.6 to $20.6 million, one of the largest totals for any technology company in Canada in the last six months. This follow-on raise is to directly benefit BuildDirect’s early shareholders as they plan to use some of the proceeds to give angels and seed investors some liquidity.
The company is a classic 10-year overnight success story. BuildDirect has been in business for 12 years and is really taking off in terms of growth, on track to grow 70% this year and projects 100% growth in 2013.
Uniquely, BuildDirect operates using a negative working capital model – meaning the company has substantial cash in the treasury for future growth and expansion.
“In North America alone, the size of the building products market exceeds $492 billion. Having solved the e-commerce issues associated with bringing heavy building materials to your door in an industry that was previously fragmented, BuildDirect has experienced record growth month over month in metrics such as website traffic, sales and customer requests for samples – which is a key leading indicator for purchase,” said BuildDirect CEO and Founder Jeff Booth.
Booth continued: “We’re not looking to be acquired at the $30 million dollar sweet spot that’s been the trend in the Canadian technology industry – our goal at BuildDirect is to become a billion dollar company in the short term. All signs are indicating this is a real possibility for us and we see ourselves on the Fortune 500 list of companies in the next decade.”
Solving the problems for e-commerce adoption of heavy building materials has allowed BuildDirect to offer its customers up to 80% cost savings and enjoy a repeat customer rate as high as 70%.
“We believe BuildDirect can become the market leader in building supplies. With over $17 billion dollars of flooring sales annually in North America alone, this is a huge space that is ready to leverage the incredible distribution power and efficiencies of a purely online business model,” said Andrew Lugsdin, Partner, BDC IT Venture Fund. “BuildDirect is led by a highly experienced team who knows their business inside and out, and are committed to building a great company.”
About Build Direct
Founded in 1999, BuildDirect is an e-commerce provider completely disrupting the retail building products industry by bridging the gap between the manufacturer and end user. By simplifying the supply chain, solving a heavy freight shipping issue that plagued the industry and creating a proprietary data-driven platform that benefits manufacturers, partners and customers alike, BuildDirect customers ultimately enjoy up to 80% cost savings. The company is headquartered in Vancouver, B.C, with eight warehouse locations in the US and hundreds of thousands of satisfied customers. For more information visit http://www.builddirect.com
About BDC IT Venture Fund
The BDC IT Venture Fund is a Canadian venture capital fund with partners in Toronto, Montreal, Vancouver, and Ottawa. We actively invest in early stage IT companies with passionate entrepreneurs who think big and will disrupt existing industries or create entirely new markets. Entrepreneurs come first and we use our broad network and operational backgrounds to help companies grow into global leaders. We lead the majority of our investments, which are typically early stage start-ups (late seed and series A) focused on Enterprise, Internet, or Mobile. The fund has invested in many successful companies including Radian6 (acquired by Salesforce), Blaze Software (acquired by Akamai), Opalis (acquired by Microsoft), Bycast (acquired by NetApp), and Q1 Labs (acquired by IBM). Visit our website at http://www.bdc.ca
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