£2.5m will help Arcus Global make councils more efficient
Arcus Global has raised an additional £2.5million on a follow-on investment round after the £3million raised in May last year to enhance its services for local government.
The market leader in GovTech cloud solutions has made huge progress since it started building software to streamline and enhance local government services in 2014.
The funding is primarily from existing investors, principally led by funds advised and managed by YFM Equity Partners (YFM). It brings the total Series A financing to £5.5million, which will be used to deliver mission-critical technology solutions that enable local authorities and other public sector organisations to transform their service delivery to citizens.
Denis Kaminskiy, CEO and co-founder, said: “This new investment from existing shareholders is a huge sign of confidence in the execution of our strategy to deliver innovative cloud solutions to enable the digital transformation of the public sector.
“Their continued support is an endorsement of the rapid progress we’re making in disrupting the GovTech software market.”
The proceeds will be used to accelerate the growth of the business and continue investment in its transformative product portfolio, including further development of Arcus’ local government software platform and recently launched AI-powered voice solution, Arcus Answer. In the financial year ended June 30, 2018, Arcus delivered annual revenues of £13million, representing 34 per cent year-on-year growth.
The company employs 95 people, based at the Allia Future Business Centre on King’s Hedges Road.
“We do have some international customers in Europe, for instance in universities, but around 95 per cent of our work is UK-based and in the public sector,” Denis told the Cambridge Independent. “That’s local central government, the NHS and some higher education.
“This investment is for us to strengthen the business for further growth – growth costs a lot of money. We’ll be supporting businesses with this funding, accelerating the service to existing customers rather than using it for new clients. We have a service-based business, so we update the software regularly, and software development is a big part of what we do – for instance we’re introducing AI elements and data analytics at the moment. Anything that makes the work of local government more effective is our remit, that could mean more manual tasks being automated, or modernising the software used in the public sector.
“It’s certainly a challenge, but over the years we’ve built up our expertise.”
Curiously, Arcus Global doesn’t currently work with Cambridge’s councils. “We’ve had some positive discussions, but each authority has their own challenges,” notes Denis.
Eamon Nolan, partner at YFM Equity Partners, said: “Undoubtedly, outdated legacy systems are holding back the organisations in the public sector. Arcus Global is making great steps to help drive true digital transformation with leading local authorities, universities and the NHS across the UK and we are excited about the positive impact this has and what Arcus is set up to achieve over the next few years.”