Dhaliwal realized he and his team had been working so hard on software development, they hadn’t focused enough on the HR problems they were trying to solve. They also hadn’t been keeping track of who their competitors were and what they were offering.
An ‘a-ha’ moment
“It was sort of an ‘a-ha’ moment for us,” he says. “From 2005, we started researching our key markets and adding features so we could actually compete with others in the marketplace.”
The Indian-born entrepreneur first went into business providing IT services during the Y2K era. A client of his had acquired a software company, but only wanted the firm’s workers, not its HR scheduling application. Dhaliwal made a deal with his client to acquire the software.
For years, Dhaliwal focused on adding features to the software. However, it only really started to get traction in the market after he put together a skilled team that completely rebuilt the product.
The technology introduced at that time still forms the core of the product today—even as Celayix has moved to the cloud and added features, including employee self-scheduling and a variety of employee tracking and communication tools. With these additions, the company has been experiencing 20 to 30% annual growth since 2011. It has 35 employees in its Vancouver headquarters.
Used debt financing
Most of Celayix’s sales are in the U.S., where its software is used by companies in more than 20 sectors. Clients benefit from being able to better control their labour costs, while employees enjoy more flexibility and choice over their work hours.
Even though he’s had many offers, Dhaliwal has shied away from taking venture capital. Instead, he has reinvested profits and turned to BDC for term loans to bolster his working capital.
Different types of financing can be appropriate for a tech company, depending on its stage of development. However, many entrepreneurs aren’t aware that business loans may be available for their growing company.
A key advantage of using loans is you avoid the ownership dilution that comes with equity financing. Even companies with limited revenues and physical assets may be able to leverage intangible assets such as intellectual property to obtain a loan.
Working with BDC has allowed Dhaliwal to protect his cash flow while he grows his business. He says this has helped him focus on his company without having to please investors.
“We’ve got folks who would give us money and take equity in the business. I think that is always tempting, but the risk/reward isn’t there for us, yet,” he says.
“People say go big or go home, but I don’t necessarily think that’s true, because going big also means a huge amount of risk for the business.”
You have to find something you feel passionate about and then work your butt off to win.
Solving shared challenges
Dhaliwal credits a group of technology and biotechnology CEOs in the Vancouver region for helping him to successfully navigate his company’s growth. The group, called Acetech, meets regularly to share experiences and discuss solutions to problems.
“As the CEO, you are kind of banging your head against the wall trying to come up with solutions for everything,” he says. “With Acetech, there is this group of people who are facing similar problems. Many of them have solved these problems, gone past them and grown tremendously.”
For example, Dhaliwal often had difficulty finding the right people for his team. Working with Acetech helped him come up with a more systematic hiring approach, dramatically improving his staffing decisions.
“If you want to be the top dog, you have to innovate,” Dhaliwal says. “How do you innovate as a technology company? You need to have great people and that’s what we have.”
He also started using key performance indicators (KPIs) to monitor his company’s performance. He says they have given him and his employees a better idea of the true health of the business.
Dhaliwal says he could never have created a successful, growing business without being deeply passionate about it.
“You don’t have to be the smartest person; you don’t have to have the greatest idea. You have to find something you feel passionate about and then work your butt off to win.”