Quebec AI software company Coveo raises $100 million from Silicon Valley fund

Coveo, a leader in AI-powered insight, recommendations, and search engines has announced a $100 million investment from Evergreen Coast Capital, a Tier 1 Silicon Valley-based tech investment firm.

The Quebec City company uses intelligent search and AI technologies to personalize the digital experience. Coveo combines unified content and interactions with machine learner to deliver relevant information and recommendations across business interactions, and is embedded in many leading business applications from vendors like Adobe, Microsoft, Salesforce, Sitecore, and Xero to name a few.

The $100 million investment was led by Elliott Management’s Menlo Park, California-based private equity affiliate, Evergreen Coast Capital, and constitutes a 27% stake in the company.

According to the Globe and Mail, the deal values Coveo at $370 million, and the company is valued at over $50 million in annualized revenue.

“Evergreen focuses on fast-growing technology companies that have proven customer traction and a clear opportunity to win in growth markets. With Coveo’s evident leadership in the machine learning applications space, the company clearly fits that bill.” said Isaac Kim, Managing Director of Evergreen. “Throughout our extensive due diligence, we have concluded that the company is the indisputable leader in its market, and with its management team’s extensive experience and R&D superiority we see this market leadership only accelerating in the future.”

Coveo has been recognized by Gartner as a Leader with the most complete vision and strongest execution score among Leaders in the Magic Quadrant for Insight Engines 2017, and was also named a leader in The Forrester Wave™: Cognitive Search and Knowledge Discovery Solutions, 2017.

“Coveo has enjoyed hyper-growth year over year. We have been at the forefront of digital personalisation for the enterprise, a fast-growing market, with machine learning-powered search and recommendations software,” commented Louis Têtu, Chairman and CEO of Coveo. “With this financing, we intend to broaden our market footprint with even more aggressive investments in sales, marketing, channels, as well as launch new lines of business beyond the current Salesforce, Microsoft, and Sitecore products. In addition, we’re opening up a whole range of new opportunities by expanding our platform on Elasticsearch, enabling organizations to leverage Coveo as their enterprise-wide relevance backbone, from eCommerce to customer service and the intelligent workplace.”

The company, which originated in Quebec City and now has an office in Montreal, intends to further expand its R&D team. Coveo also recently announced its inclusion in SCALE.AI (Supply Chains and Logistics Excellence.AI), a Canadian industry-led innovation consortium with $230M of funding to accelerate the integration of next-generation AI and machine learning-powered supply chains in the Canadian economy

“As a leading tech and AI company in Canada, we’ve grown our R&D centers in Quebec City and Montreal to more than 200 developers and data scientists, while serving a global enterprise market. We’re tapping into a local talent pool with world-class machine learning and AI expertise.”

The investment from Evergreen will be used to accelerate growth organically and through strategic acquisition opportunities that may arrise.

“We’re excited to partner with a Tier 1 Silicon Valley investment firm. Evergreen has been an absolute pleasure to work with. The quality of their team and their long-term investment perspective aligns with our goals, and really stood out over the investors we explored discussions with. With their investment and capabilities we now have a war chest at our disposal to pursue our aggressive goals,” said Jean Lavigueur, CFO of Coveo.

While full terms of the transaction were not disclosed, Evergreen minority ownership stake of 27% was revealed, as well as the fact that Bill Shaheen, an Operating Executive with Evergreen, will join the Coveo Board of Directors.

“Coveo is already a tightly run ship, and we’re looking forward to helping them with their next phase of growth. I’m delighted to join the Board to help advise this strong team going forward,” said Shaheen.



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