Vidyard co-founders Michael Litt (left) and Devon Galloway (Photo: Clay Stang)Communitech @20: How Vidyard’s road to success led back to Waterloo Region Communitech June 26, 2017 Communitech @20, Featured, News Frosh week, 2005. Michael Litt and Devon Galloway are freshmen in the University of Waterloo’s systems design engineering program. During a scavenger hunt, the new classmates team up for an ice cream-eating competition. One must stand behind the other, reaching his hands under the man in front’s armpits to feed him. The first pair to empty their bowl will win. Galloway claims a lifetime of summers at his family’s cottage have prepared him to ace this thing. He hands Litt the spoon and instructs him to shovel as fast as he can. “I threw away the spoon and grabbed two handfuls of ice cream and shoved them in his face,” says Litt, laughing at the memory. “We won.” “We’ve been known to break the rules a fair bit over the years,” Galloway chimes in. Lessons learned: (1) Go your own way; (2) always win. Skip to late 2009. Litt is in Silicon Valley, finishing a co-op placement with Cypress, a global supplier of semiconductor technologies. He will soon return to Waterloo Region, where he was born and raised. Galloway flies west to join him for the drive home. For much of the 4,200-kilometre journey, they talk Internet video. “We had been interested in building a business together for quite some time prior to that drive,” says Litt. “When you’re in a car for that long, you end up throwing around some pretty creative ideas.” The one that sticks will become Redwoods Media, a maker and distributor of promotional and educational videos for other businesses. At the time, Litt and his brother Stephen had already established a residence in Waterloo called Batavia House, which they shared with a rotating cast of entrepreneurial classmates – including Eric Migicovsky, whose Pebble smartwatch would one day set records on Kickstarter. The bungalow-as-incubator was a good idea when it began, but seemed slight as things turned more serious. Enter Communitech, which was ready to receive Redwoods. “You can’t ignore their impact and almost the gravity they create for that ecosystem.” – Michael Litt “As the organization that supports startups in [Waterloo Region] and southwestern Ontario specifically, you can’t ignore their impact and almost the gravity they create for that ecosystem,” says Litt. They were assigned Dan Mathers, an executive-in-residence who helped make Redwoods a reality – although they soon became interested in developing technologies to study how media was consumed. A proprietary tool to analyze marketing videos became the subject of Litt’s UW thesis and a fourth-year design project for him and Galloway. They launched Vidyard together in the spring of 2011. The Financial Post has since described the video management platform as “a sort-of YouTube for businesses” – which helps explain how they secured YouTube co-founder Jawed Karim as an early investor. Fast-growing Vidyard moved into its current space in 2016. (Photo: Clay Stang) As respective CEO and CTO, Litt and Galloway returned to Silicon Valley that same year to vie for acceptance to Y Combinator, the hothouse for some of tech’s most ambitious startups. They submitted a video with their application, and were able to use its data summary to prove whether or not their interviewers even opened the file, let alone watched it. They hadn’t. It was a cheeky move, but it helped secure their acceptance. Nowadays, both men credit Y Combinator for accelerating Vidyard’s development. Within a few months they were able to announce US$1.65 million in seed financing – in Litt’s words, enough to “go and execute on the vision and the dream.” With the blessings of their investors, they hit the road again, determined to grow Vidyard back home in Waterloo Region – a bold decision that would set an example for a string of young entrepreneurs to follow, and energize the region’s startup scene. Re-enter Communitech, which again seemed like a natural choice to nurture their ambitions. This time, Litt and Galloway were on their own, but still benefiting from the mentoring they’d received in 2010 from Brett Shellhammer, an executive-in-residence and expat American with a history of success with startups – including a stint as Senior Vice-President of Product Management at Eloqua Corporation, a Toronto-based maker of marketing automation software that Oracle acquired for US$871 million in 2012. “Communitech was absolutely essential in paving our path into the marketing technology ecosystem.” – Michael Litt “If it weren’t for Communitech, we would not have met Brett Shellhammer, we would not have met Eloqua, we would not have completed another road trip…Communitech was absolutely essential in paving our path into the marketing technology ecosystem,” says Litt. In 2012, the duo embarked on another epic drive, this time to Orlando. The fledgling company dipped into its reserves to sponsor a tech conference. They covered Galloway’s car with Vidyard stickers, then parked it on the lawn of the hotel hosting the event – which is how they met and closed deals with their first major customers. That list has since swelled to include Honeywell, Lenovo, LinkedIn and NetSuite. Vidyard stayed close to the Communitech Hub, inhabiting space in the adjoining UW Velocity Garage until 2012, when its team had grown to 12 members. First, they gutted a nearby house to serve as a larger office, only to realize within months that was also too small. A two-floor set-up inside the historic Simpson Block on nearby King Street was the next move, and intended to become a long-term home – but Vidyard quickly scaled out of that, too. In the summer of 2016, they moved into the newly renovated Goudies Building at 8 Queen St. N. The current digs have room for about 250 employees, although staff rolls are steadily approaching 300. An expansion office in Vancouver opened last year, with others in Boston and San Francisco coming online soon. Through Series C financing (led by Battery Ventures, and completed in January 2016), Vidyard had raised more than US$60 million, with an estimated valuation of $300 million. Litt has become a highly sought-after advisor and public advocate for Canada’s tech industry – plus a member of Communitech’s board. His company remains closely linked to the Communitech Hub, both geographically and philosophically. Vidyard’s internal culture once favoured hacking competitions, but those have given way to acts of civic goodness, including monthly events to benefit local businesses and a 1:1:1 corporate pledge to donate time, product and earnings to area non-profits. And the house Litt and Galloway bought, gutted and briefly occupied in 2012, which they still own, has since been rented to a succession of local startups at favourable terms. All of which helps bolster the company’s rep as a familiar, committed member of Waterloo Region’s startup scene.