Friday, June 16, 2006

Shift Networks Gets Funding

In the big scheme of things this is a small story, but it's big news for Shift Networks, and good news for those in Canada's SMB market looking for IP solutions.

Shift is a small, but up and coming provider based in Calgary, Alberta, and they've come to a market with a hosted IP solution (based on the BroadSoft platform). On Wednesday this week, they announced a private placement of $5.2 million, which will fund their growth, including expansion plans into Eastern Canada, and beefing up their management and sales teams. Among their management ranks is their CTO, Erik Lagerway (formerly of Eyeball and Xten/Counterpath), who is no stranger to the IP world.

I say this is a good news story for Canada, mainly because there's not much in the way of a CLEC market here, so there are few carrier-based options for SMBs outside of the handful of ILECs we have. In light of how the Telecom Panel Review is gaining credence with our regulators (i.e. pro-competition and open markets), Shift is a great example of an company bringing more choice to the market. Shift is also a public company (SHF on the TSX Venture Exchange) - albeit not widely followed - and we don't have many of those here in the IP space.

Can they take things to the next level? We'll find out soon, and if they do, at least you can say I told you first. Or almost first, as I haven't seen their news picked up anywhere else in the Canadian blogosphere, other than on Erik's blog (of course!). And if you want a better read on how the company is doing, Erik also has a post highlighting Shift's Q1 financials - which definitely show growth.


ipcom said...

Posted by: Tamouh

I know that Shift has just launched in Ontario, though I agree they don't appear to have that huge marketing initiative going yet!

ipcom said...

Posted by: reg

Is the withdrawal from financing in recognition of its restrictive affect on stock price?

ipcom said...

Posted by: JohnJ

Shift's stock trading has been suspended for the last 3 days.... hhhhmmmmmm maybe that expansion into Ontario (Which really never got off the ground) hasn't gone as well as expected...

ipcom said...

Posted by: Tamouh

Don't say I didn't tell you so. In my opinion, I found them to be disorganized internally with constant network, software and plans changes. It seemed like they were throwing money around during their ON launch. That was a tip I got from a telecom guru: Know that a telecom company will go down the drain when they waste money on unnecessary items. This is what happened with Cannect Communications (remember them?) and many other fancy telecom companies.

I believe, Shift idea never picked up. Yes, they sold in Alberta but they were never profitable. They've been selling for 2-3 years and still in the red.

ipcom said...

Posted by: Lyle

From Angus:

"SHIFT NETWORKS FOR SALE: Shift Networks, a Calgary-based provider of hosted VoIP services for small businesses, is for sale. The company has been operating under CCAA protection since May 8, and the TSX has halted trading in its shares. For information about the bid process, contact Price Waterhouse Coopers in Calgary."