Montreal-based Lightspeed, which develops cloud-based point-of-sale systems for retailers and restaurants, has raised an $80 million investment round, the company announced on Wednesday.
The new money will be used to accelerate the Lightspeed’s international growth, says Dax Dasilva, the company’s founder and CEO.
“We raised a year ago and we’re still well capitalized, we just have had some really great momentum in the last 12 months and have a lot of opportunities internationally and in e-commerce,” he says.
Lightspeed expanded into the restaurant market last September, that was partially driven by an acquisition in Belgium.
It’s given the company’s restaurant POS business a stronger presence in Europe than in North America. It’s the opposite story for its retail-focused business.
“I think the big opportunities for us are bringing the restaurant software more to North America and bringing the retail software that we have to Europe,” he says.
Europe has been a particularly strong growth market for Lightspeed. While Dasilva says Lightspeed’s overall business grew by 123 per cent year-over-year, its European business grew by 745 per cent over the past year.
Part of that growth is being driven by regulatory changes that have seen European governments require bars and restaurants to install fiscal memory devices that track all sales going through a POS system to ensure that taxes are being paid. Those systems often require businesses to install new POS systems.
“It’s an opportunity for businesses, while seeking compliance with these new regulations,” he says, “to make the leap to cloud-based systems.”
Dasilva says he sees a similar opportunity in the United States where credit card companies have created a deadline for retailers to start accepting chip cards.
After, Oct. 1, retailers who don’t accept chip cards will no longer be reimbursed by credit card companies if they’re the victims of fraud.
Dasilva says the investment will also help Lightspeed improve its e-commerce and omnichannel offerings, giving merchants more flexibility and the ability to connect online and offline experiences.
The current investment round is being led by the Caisse de dépôt et placement du Québec, an institutional investor that manages public and para-public pension plans along with Investissement Québec, a provincial economic development agency.
For Dasilva, the support from within Quebec underscores his commitment to grow Lightspeed’s business internationally, while keeping it headquartered in Montreal.
This is the third major investment round that Lightspeed has raised. It brings the company’s total funding to $166 million.
“Right now, it’s a really exciting time for point-of-sale,” he says. “Both on the retail and the restaurant side, this merging of online and offline, along with the regulation changes, it’s got a lot of business owners asking if their current system is helping their business be what it should be.”