Cloud specialist eyes international expansion after NorthEdge investment
NorthEdge Capital has invested for a significant stake in cloud transformation and infrastructure specialist Cloud Technology Solutions.
The funding backs the incumbent management team led by chief executive James Doggart, chief science officer Steve Dobson and chief finance officer Hannah Liptrott.
Founded 10 years ago and headquartered in Manchester city centre, CTS provides cloud transformation services and software products to a broad range of businesses. The Google Premier partner has migrated more than seven million users to the ‘cloud’.
CTS has undertaken transformation projects for Ladbrokes-Coral Group, HomeServe, Roadchef and recently worked with Manchester City Council, migrating more than 7,000 local authority workers to Google G Suite.
CTS has also developed a strong offering in Google Cloud Platform and IaaS (infrastructure as a service). Additionally, the software products created by CTS, CloudMigrator and Cloud Pages, are now used by upwards of 10 million users worldwide in more than 74 different countries.
CTS has experienced a period of strong growth, with revenue having tripled over the past three years, and has had a promising start to the year with several new business wins and an expansion of its city centre offices at Lowry House. The business now employs more than 100 staff across its offices in Manchester, Belfast and Edinburgh.
NorthEdge’s investment will provide support for the business to continue the development of its own software products as well as providing development capital to accelerate growth through complementary acquisitions in machine learning, artificial intelligence and data analytics.
The deal was led by NorthEdge’s Jon Pickering, partner and head of North West, and Dan Matkin, investment manager. Pickering joins the board at CTS as a non-executive director, alongside recently appointed Ian Kelly as chairman.
The investment extends NorthEdge’s recent track record of supporting Northern-based tech companies following its investment in Cubic Motion in September 2017 and recent successful exits of Utiligroup and Sumo Digital in the last 18 months.
Doggart said: “I’m really excited about the investment from NorthEdge. The timing is perfect given the growth of the market. It will allow us to take advantage of the global market demand for cloud, our plans have us doubling our workforce over the next three years.
“Our technology is currently used in 74 different countries, this funding means that we can push on even further globally, whilst continuing to accelerate the development of our products to offer industry defining value to our customers and partners.
“This investment will allow us to take our business to the next level and keep pace with the global investments of public cloud providers such as Google. This is an exciting time to be in the cloud space and we are now well placed to push on for growth.”
Pickering said: “Evolutions in the IT and technology sector are currently driving major growth of 40%-plus per annum in the public cloud market as companies move away from traditional on premise to cloud hosted infrastructure.”
GCA Altium provided Corporate Finance advice on the deal, with the team comprising of Simon Lord, Dom Orsini and Phil Chadwick.
Lord, managing director at GCA Altium, said: “Cloud Technology Solutions is a fantastic example of an entrepreneur backed company identifying early how the cloud can act as a positive catalyst for businesses and organisations. The company has developed a SaaS (software as a service) driven business model and assembled an impressive team of experts to serve its growing corporate client base.”
Legal advice was provided to NorthEdge by Giles Chesher, James Fitzgibbon and Matt Canipa of Squires Patton Boggs.
David Easdown and Matt Flanagan of Turner Parkinson provided legal advice to management. Deloitte provided financial due diligence support to NorthEdge, led by Jodi Birkett, Colin Kerr and Alex Ault.
EY provided due diligence support to NorthEdge, led by Olivier Wolf, Ulrich Loewer and Satya Ammu. PWC provided tax support for the transaction, led by Simon Viner and Adam Waller.
