Data virtualization technology provider Xkoto Inc. today announced that it has raised $7.5 million in Series B funding. GrandBanks Capital led the deal, and was joined by return backer GrowthWorks Canadian Fund. Three notes on this deal:
1. Xkoto is based in Toronto, but is moving its HQ to Boston. Why? Because the feeling is that the relevant labor pool is deeper in Beantown.
2. GrandBanks founder Charley Lax yesterday wrote about how Canadian regulations make it particularly costly to invest in Canadian companies. For example, he said that the company and investor counsel bills for the Xcoto deal came to over $300,000: “It’s hard for U.S. venture capitalists to justify making Canadian investments when meaningless paperwork wipes out over 4% of our capital.”
3. Tim Wright led the deal for GrandBanks, which also doubles as his official coming-out party as a venture capitalist. He is the firm’s third general partner, and came aboard as the firm is in market for its second fund. He is a serial operator, having previously worked with Geac Computer Corp., Terra Lycos, The Learning Co., etc.