Ryan Unruch: Hi, I'm Ryan Unruch, a partner in Osler's Emerging and High Growth Companies group, and a co-author of this year's Deal Points report. Today, I'm pleased to welcome Mark Shulgan, a co-founder and partner at Intrepid Growth. Mark has over two decades of experience in growth equity, leading top performing teams at a number of global investment firms. Previously, as a founder and former head of OMERS Growth Equity, Mark oversaw over $1 billion in investments across 20 companies in software and tech-enabled healthcare. Prior to that, Mark co-founded CPPIB's Thematic Investing team, managing over $6 billion in capital across 30 companies globally. He has chaired investment committees at OMERS and CPPIB and previously served as vice president at Fortress Investment Group. Thank you for joining us today, Mark.
Mark Shulgan: Thank you, Ryan. Delighted to be here.
What makes Intrepid different?
Ryan Unruch: So to kick it off, maybe you can give us the elevator pitch for Intrepid Growth, what makes Intrepid different, and maybe you can provide our listeners with a little background on your co-founders and investment team.
Mark Shulgan: Yeah, for sure. I'm happy to do so. So we launched Intrepid about 18 months ago. Intrepid is different because we are focused only on the AI application layer and only on growth stage companies, which we generally define as being $10 million or more of revenue. But what we really mean by that is that they found product market fit. We're focused on investing in both North America and Europe and we have a team that's divided across Toronto and London. I co-founded Intrepid with two partners, Mark Machin and Ajay Agrawal. Mark Machin and I worked together closely while I was at CPPIB and was building out their Thematic Investing team, which then ultimately became CPPIB's Growth Equity investing platform. And Mark was always just kind of interested in what we were doing and has a background where Mark was very interested in neural nets at a very early stage when he was training as a doctor and then ultimately considered becoming a neurologist.
And so that's dating back now more than two decades. And then my other partner, Ajay Agrawal, started something called the Creative Destruction Lab in 2012 that started out of University of Toronto. And Ajay has been on the theme of the machine intelligence now for well over a decade. We thought that it was important to have a dedicated focus on AI because we think that this platform shift is very different from the others that we've experienced over the last couple of decades. So I've been an investor through the internet transition, through the mobile transition and through the cloud transition. We think that AI is much larger than all of those and that this is going to be something that is more akin to the invention of electricity in terms of the changes that it's going to facilitate. We think we're really just at the very beginning, the light bulb is very, very early and dim in terms of what we think this is ultimately going to look like. And so we wanted to create a foundational firm focused on global investments that only focused on AI companies.
What initially attracted you to the company and its management team?
Ryan Unruch: I think congratulations are in order. It was recently announced that Intrepid participated in StackAdapts $235 million financing round. Maybe you could talk a little bit about the transaction, what initially attracted you to the company and its management team?
Mark Shulgan: Yeah, we're really excited about StackAdapt. I think it is an exceptional Canadian company and I think it will go on to demonstrate that there will be an exceptional global company. We were attracted to StackAdapt because we think it's a great example of the ability to be able to use machine learning or machine intelligence to be able to drive a much more efficient business. And so, some of the numbers on StackAdapt are quite staggering in terms of when the company was founded and just how big it's gotten and how quickly. The company now has more than a thousand employees. Most of their business is generated within the U.S. and we think that they've created a really unique product. I think one of the other things worth calling out on this investment is that they participate in an unloved sector. I've been an investor for a long time and in the late 2010s invested in the adtech sector and had a terrible experience like most other investors in that space because it was really dominated by the likes of Facebook and Google and Amazon, the Walt Gardens that we know of.
And so there are a lot of wounds that are worn if you're a growth equity investor that's been in the market long enough, then you know that adtech can be a difficult industry. But I think that the way that the Vitaly and Yang kind of attacked the problem was that they noticed that the industry was changing. They built from the very foundation, I think an incredible product that really shows through when you speak to customers and then also when you look at some of the ratings like g2 for example, where they're the best product by quite a margin, particularly serving the small and medium sized end of the market. And what they created was an end-to-end tool that anybody in a demand generation or advertising or brand department can access and implement on their own. This was a domain that previously was only available to really large size companies.
Smaller companies would buy AdWords, which can be once you start to spend more, becomes a really inefficient way to spend. And so what attracted us to it was that we thought that it was an overlooked opportunity where over time we think that the market will begin to look at StackAdapt a lot more like a software company than a transactional ad exchange business. And we think that there is going to be a significant rerating that's going to happen as investors begin to realize that this is more like a software company than it is a more traditional adtech, ad exchange business. We love the team. I mean, I think from our first meeting with Vitaly and Yang, we got the sense that they shared our values. They're hungry, they're humble, they're smart. And despite being in Canada, they've built this incredible business that has become the dominant solution within the U.S. and the SMB advertising space for programmatic advertising.
And we think they've got the proof points in other markets. And a lot of the due diligence that we do in addition to more traditional forms relies on our network because of the seats that my partners Mark and Ajay have sat in, we get this unique access to the C-suite and very senior people. And so in a few quick calls, we can figure out what the world really thinks about these companies. And through and through, talking to some of the heads of the biggest global advertising firms in the world, StackAdapt has built this incredible reputation. They're known by the top global ad executives. We took a lot of comfort in the work that we were doing that was being complimented by the feedback that we were hearing in those customer channels.
With the constant change of AI in terms of what's happening in the markets, what are you most looking forward to in 2025?
Ryan Unruch: That's great. Such an amazing Canadian success story. And then maybe just one last question before we wrap up. With the constant change of AI in terms of what's happening in the markets, what are you most looking forward to in 2025?
Mark Shulgan: I think we're kind of at this inflection point within AI and all prior technology cycles. We will go through a hype cycle. There's no question about that, but I think what we're getting to see is real enduring value that's being created by AI where it's becoming more embedded every day. And I think the applications that we have today give you a glimpse of the future, and there are some industries that are faster adopters than others, but we are spending a lot of time around healthcare diagnostics tools. And we think that that is a really interesting area where AI is being applied to really transform lives. And so we're seeing the initial proof points. I think for 2025, by the time that we get to the end of this year, what we're going to see is that the number of applications are going to start to proliferate.
And what we have seen with the introduction of models like DeepSeek is that you are not constrained, you're not outside of the market. The technology, the core technology that drives AI is going to become cheaper and cheaper, which is going to enable developers to be able to build new products in different industries. And the adoption can be incredibly quick. So I think we're at this point now where we're just beginning to see this massive proliferation of applications, and I think the use cases are going to be exponential by the time we get to the end to 2025.
Ryan Unruch: No, that's super fascinating. And we're all kind of looking forward and seeing some amazing companies getting launched in Canada in this kind of vertical, so that's amazing. So thank you again, Mark, for joining us today. And to our listeners, if you have any follow-up questions for Mark, feel free to reach out directly. And thank you everyone.
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