The Big Read

Canada’s PayPal Mafia: The surprising afterlife of Workbrain, the 2000s-era startup that inspired some of Canada’s most promising tech companies

Anson Chan for The Logic
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For companies that make HR software for other companies, the spring must have been an anxious time. Over a week or so in early April, the U.S. reported its worst monthly job losses since the financial crisis: 701,000. Canada saw over a million people newly out of work, the largest single-month decline in four decades of recordkeeping.

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HR tech firms watched as clients laid off many of the workers their software was used to manage. Some saw their stock prices drop. Several laid off employees. The next month’s unemployment numbers were even worse, as the global economy seemed set for a recession unseen since the Great Depression. But in the ensuing months, HR tech firms did not necessarily go into freefall. Far from it.

Talking Point

The executives and entrepreneurs behind some of the most promising tech scale-ups in Canada today credit their careers and success to their experiences at Toronto-headquartered Workbrain. Alumni of the workforce-management firm—founded in 1999, publicly listed in 2003 and sold in 2007—now occupy top positions at the likes of Ceridian, Shopify, Achievers and AlayaCare.

Take Ceridian, headquartered in Minneapolis, but run from uptown Toronto. Recurring revenue for its core Dayforce product actually went up 12.2 per cent year over year in the third quarter. The 4,000-plus firms that use Ceridian’s payroll, talent and workforce-management platform continue to bring back staff. After April’s slump, Ceridian’s stock is back to historic highs. The company plans to hire 2,000 people in Canada over the next five years.

It turns out that businesses, even struggling ones, need to pay their employees. Many will also still need to schedule their shifts and track their time. So, companies that make payroll, time and attendance and scheduling software are proving indispensable—so far. “As long as businesses are open—which is a new qualifier I’m adding since COVID—it’s an essential need,” says Martin Hartshorne, the recently installed CEO of Minneapolis-based scheduling platform When I Work. “It’s not superfluous. It’s not some extra productivity tool.”

But there may be something else at work in Ceridian’s success, particularly through the past few months.

To tackle a crisis, a company needs “a very resilient, persistent team of people” with the desire “to succeed, regardless of obstacle,” says David Ossip, CEO of Ceridian, once a fading U.S. giant that his team turned into Canada’s biggest tech IPO of the 2010s. But Ossip is talking not about COVID-19 and Ceridian, but about another outbreak—SARS—and another team: Workbrain, the Toronto-headquartered workforce-management software company that Ossip started, took public and sold nearly a decade and a half ago.

Ossip launched Workbrain in 1999, when tech valuations were soaring and startups proliferating. But the next few years brought challenges. From its Toronto headquarters, the company thrived even as the dot-com bubble burst around it, and it weathered the economic shocks of recession, 9/11 and SARS. In 2003, Ossip took the company public at a near-quarter-billion-dollar valuation. Ossip, then, knows something about adversity, opportunity, and the business of building a fast-growing tech company. But the lessons of Workbrain’s seven-and-a-half-year life aren’t his alone. They inform the trajectory of not only Ceridian and other HR tech firms, but a host of scale-ups across the country—many of which trace their roots back to Workbrain.

Today, a generation of Canadian tech executives—many still working in HR tech—cite their time at Workbrain as formative, a school for the skills and experience they’ve needed to shape promising companies in the current innovation economy. “It was better than a Harvard MBA,” says Neil Grunberg, co-founder and vice-president of strategy and corporate development at Montreal-based AlayaCare, a 450-person firm that makes software for home care providers.

By mid-2007, Workbrain the company was gone, subsumed into Infor, a private equity-fuelled, acquisition-hungry rollup. But the company’s culture, and a number of its high-level employees, are now scattered throughout Canada’s tech ecosystem. Hoping to replicate the energy, culture and success they’d found at Workbrain, they founded or joined many of the country’s next crop of high-growth startups. If Canada has anything like a PayPal Mafia—alumni of the payments company who created new success stories, like Tesla’s Elon Musk, Founders Fund’s Peter Thiel  and Affirm’s Max Levchin—the web of Workbrain alumni might be it.

***

Workbrain was founded in late 1999, in the late days of the dot-com boom, and at a time when workforce-management software was fairly primitive. The code that companies used to log when employees clocked in and out and to manage their schedules lived on individual computers in thousands of store, factory and airport back offices. Workbrain told its massive clients it could set up one server, then let every location use the web to file its reports.

Workbrain: Where they are now

David Ossip
Then: CEO and Co-Founder
Now: CEO, Ceridian
Ossip launched HR software startup Dayforce in 2008, mounting a reverse takeover of Ceridian in 2012 and taking the firm public in 2018.

David Stein
Then: Chief Strategy Officer and Co-Founder
Now: Managing Partner and Founder, Leaders Fund
Stein started Rypple with ex-Workbrainer Daniel Debow in 2008, selling it to Salesforce in 2012, before launching his software-focused VC firm in 2016.

Stephen DeBacco
Then: Chief Operating Officer
Now: Managing Partner and Founder, Leaders Fund
Atlanta-based DeBacco remained at Infor for a time after the sale, then joined Stein and Debow at Rypple before teaming up with the former to create Leaders Fund.

Matthew Chapman
Then: Chief Financial Officer
Now: Partner, TorQuest Partners
After Workbrain, Chapman wanted to “go into a business where the business was finance,” so he joined Toronto-based private equity firm TorQuest.

Daniel Debow
Then: Vice-President of Corporate Development
Now: Vice-President of Commercial, Shopify
After a nearly four-year stint at Salesforce following its acquisition of Rypple, Debow started Helpful, an enterprise-software startup; Shopify bought it in 2019.

Kristina Cleary
Then: Senior Director of Marketing
Now: Founder, Cleary Leadership
Cleary joined Dayforce, becoming CMO at Ceridian, before launching her own leadership-coaching practice in 2019, with a focus on developing performance metrics and strategies.

Eric Green
Then: Vice-President of Business Development
Now: General Manager of Askuity, Home Depot
Green left in 2004, shortly after the IPO, starting and selling a cleaning-products firm before launching retail-analytics startup Askuity.

In short order, the Toronto-founded upstart ousted Kronos, the Chelmsford, Mass.-based titan of time and attendance. Soon, it was handling those tasks for established manufacturing, retail and industrial giants. By 2006, it was bringing in US$96.5 million in annual revenue and had more than 600 employees.

Workbrain won large accounts with a persistent salesforce, or through ties with IT firms like Accenture, IBM and Deloitte, backed by an R&D team willing to build whatever it was clients needed. Then it dispatched roving teams of consultants to install the new systems and trainers to teach customers’ employees how to use them.

Right from the start, Workbrain went after the biggest targets. Marquee first customers included the Tennessee Valley Authority, a federal power company covering seven U.S. states; the North American operations of British Airways; and Russell Athletic, Major League Baseball’s uniform maker at the time.

Initially, firms of that size weren’t keen to even take a meeting with a startup, particularly one from Toronto. “We were selling giant enterprise software, massive multimillion-dollar contracts to huge American companies,” says Daniel Debow, who helped write Workbrain’s original business plan before taking a series of executive roles. “They didn’t want to hear about a Canadian company—that made them worried.” So Workbrain opened offices in Toronto and Atlanta simultaneously, and listed the U.S. side first on its website.

The company had people who could close those big-ticket deals. Jodi Kovitz, who spent a 10-month stint as a marketing coordinator starting in late 2000, sat outside the office of co-founder David Stein. “I used to listen to him sell, really through relationships,” she recalls, calling Stein one of the best practitioners of the craft she’s known. “I learned how to do that in my bones.”

Ossip and Stein flew in for some of the sales meetings, as regional sales executive Daniel Huber pitched major national brands and iconic Midwestern manufacturers. The trio would tweak PowerPoint slides in the taxi on the way. “It was a bit of an evangelical type of a pitch” compared to the more staid industry standard, Huber says—web-based, company-wide systems in place of software installed on local-area networks. In Kohler, Wis., Workbrain won the business of the town’s eponymous bathroom-fittings maker; in Minneapolis, it nabbed General Mills, home of Betty Crocker and Cheerios.

Workbrain salespeople and sales engineers, including Neil Grunberg (right) on a trip to Nevis in the West Indies.
Workbrain salespeople and sales engineers, including Neil Grunberg (right) on a trip to Nevis in the West Indies. Photo courtesy of Neil Grunberg

Workbrain was “very sales-focused,” says Huber; it was willing to put in more work upfront than the competition, demoing software already configured to the prospective client’s needs. Huge customers meant huge complexity, and the need to customize the software to their specific ways of managing time, attendance and scheduling. How do you build a system that lets staff swap shifts, say? What novelties would local clients in new markets need? During a week-long Mumbai trip to scope out customer requirements for a regional deployment, Robert Garmaise, then a vice-president in Workbrain’s professional-services group, learned about Sri Lanka’s poya fast days. “Depending on when the new moon fell that month, folks may or may not be entitled to an additional stat holiday,” recalls Garmaise, now law firm Fasken’s chief innovation officer—not something you’d find in “your standard North American software package.”

Underlying it all was a belief that Workbrain could win those deals, build those complex systems, and continue to grow, grow, grow. “Never give up, never surrender,” says Ossip, quoting an internal maxim, though two decades later, he can’t remember from which space comedy Stein took it. (It’s actually 1999’s Galaxy Quest, starring Sigourney Weaver, Alan Rickman and Tony Shalhoub.)

Then, as now, a pandemic threw up obstacles. In early 2003, Ossip had a Friday appointment at Toys “R” Us in Wayne, N.J. His hosts were screening visitors from Toronto, where SARS had just broken out. “They wouldn’t let me into the building,” he recalls. “We had to have the meeting standing at opposite ends of an SUV in the parking lot.” Most of Workbrain’s projects were in the U.S.; if staff couldn’t enter client offices for installations, the firm would lose money. So that weekend, over two days, the company moved a large group of people (Ossip says 40, Debow 70) from Toronto to Atlanta.

Today, former Workbrain employees say they never doubted that the company would be successful. “These big American [competitors], they’re not smarter than us, they’re not better than us,” Debow says of the spirit of the time. “Why not us?”

***

In December 2003, Workbrain went public, Canada’s first tech listing since the dot-com crash three years before. The company raised $46 million in an oversubscribed initial public offering on the Toronto Stock Exchange (TSX) that valued it at $232 million. The capital helped strengthen the firm’s balance sheet, but the listing also held important symbolic value, both inside and outside the company. “It was really about overcoming our ‘little-Canadian-company’ syndrome,’’ says then-CFO Matthew Chapman, who led the process.

“IPOs were very en vogue for dot-com-era companies,” says Hartshorne. “It was exactly what you [did] if you’re successful.” Grunberg, a sales engineer at the time, resolved that he’d replicate the excitement of owning a piece of the company for his own employees some day. He used some of his shares to buy an engagement ring for his now-wife. “It meant a lot,” he says.

The IPO also proved formative for some outside the company. Over the next decade, lead underwriter Sanjiv Samant would go on to lead the listings of Miranda, Evertz, RuggedCom, TeraGo, Halogen and Kinaxis, a daisy chain of deals he links back to Workbrain’s success; Samant is now managing partner of Toronto-based VC firm Round13’s growth fund. “The transaction helped accelerate careers and put a number of people on the Canadian technology map, myself included,” he says.

***

Canada’s PayPal Mafia didn’t meet in classrooms at Stanford University or the University of Illinois like the original Silicon Valley troupe. But many of Workbrain’s earliest employees have deep personal connections going back to the Ossip family home, and to their entrepreneurial endeavours.

Workbrain: Where they are now

Richard Guttman
Then: Vice-President and General Counsel
Now: Chief Legal Officer, AlayaCare
Guttman was the “first lawyer” at Workbrain, before a stint at global tech giant Siemens and top legal roles at Toronto scale-ups SecureKey, PointClickCare and AlayaCare.

Daniel Huber
Then: Regional Vice-President of Sales
Kansas City-based Huber went on to another Toronto workforce-software firm, Vortex Connect, staying through acquisitions by RedPrairie and JDA. He then joined Element AI, leaving in July.

Robert Garmaise
Then: Area Vice-President of Professional Services
Now: Chief Innovation Officer, Fasken
Garmaise spent more than a decade at Info-Tech Research Group, an IT consulting firm, before moving to the Toronto law firm in 2017.

Martin Hartshorne
Then: Senior Director of the Time-Clock Division
Now: CEO, When I Work
Hartshorne stayed with Infor post-acquisition, then launched a startup that was acquired by Ultimate Software. He left in March after more than six years, following its merger with Kronos.

Neil Grunberg
Then: Senior Sales Engineer
Now: Vice-President of Strategy & Corporate Development and Co-Founder, AlayaCare
Grunberg went on to be a key executive at Vortex Connect, selling it to RedPrairie in 2012. Former Workbrain executives Daniel Huber and Tim Lett are investors in AlayaCare.

Ozzie Goldschmied
Then: Development Team Lead and Architect
After a stint at Infor post-acquisition, Goldschmied joined Ossip to start Dayforce, running the development organization before departing as Ceridian’s CTO in September.

Vanessa Brangwyn
Then: Project Education Practice Leader
Now: Chief Customer Officer, Achievers
Brangwyn went on to marketing software firm Eloqua, then Achievers, which recently spun out of former acquirer Blackhawk Network Holdings. Achievers CMO Tony Hocevar is also ex-Workbrain.

“I found Workbrain when I was four years old,” jokes Debow, who met Ossip’s younger brother Marc, now a Toronto radiologist, in junior kindergarten. The third Ossip brother, lawyer Alon, helped set up and finance Workbrain, and went on to run the Stronach Group; their father, Martin, ran software companies, too. “I was exposed to the entrepreneurship [that runs] in that family from a young age,” says Debow.

Stein, Workbrain’s original salesperson, met Debow and Marc in Grade 7. They remained friends into adulthood, and he worked at Business Machine Interfaces, Ossip’s first HR tech company, which he sold to Japanese parking-metre giant Amano Corporation Japan in 1997. Stein and a few other employees followed Ossip to Workbrain, becoming the new firm’s founding team.

Ossip got Debow, then a JD-MBA student, to help do market research and write the business plan. Debow brought along a business-school classmate, Chapman (subsequently the company’s CFO), then went on to hire many of Workbrain’s early employees. “I spent a lot of time just finding people,” says Debow. The company picked up talent from dot-com-boom darlings like Ariba, Trilogy and Janna Systems, just as others would from Workbrain a few years on.

As with many startups of the era, working at Workbrain was intense and exciting. People were constantly taking on new jobs. Grunberg, just out of university, had roles in business development, implementation and sales engineering over his six and a half years. Debow did a lot of hiring, then found himself in a different area altogether after Workbrain cut its marketing team in Boston. He put together a deck to convince Ossip the function was still necessary. “In classic David style, he’s like, ‘Great, you’re in charge of marketing,’” Debow recalls; he reported in to Stein. Debow left in 2003 for a master of laws at Stanford University, returning when Ossip called to ask him to help write the IPO prospectus.

Workbrain focused on “problem solving, less [on] territories” or dividing up turf, Stein says. After landing some of the big early accounts, he served as frontman for the firm’s expansion in the U.K. and Australia. “I would fly down there, live in a hotel, assemble a team,” he recalls. The playbook he developed: land a marquee customer, then two more, hire a local general manager, move some staff over from headquarters, move on to the next market.

Ceridian CMO Kristina Cleary, previously Workbrain senior marketing director, at a company event in 2017.
Ceridian CMO Kristina Cleary, previously Workbrain senior marketing director, at a company event in 2017. Ceridian

“To hold your own in the early days of Workbrain, you had to be bloody bright, resilient, and while you were doing that, you had to be a wonderful person,” says Ossip. Kristina Cleary, then the senior marketing director, describes the philosophy as simply “hire the smartest people.” A decade and a half later, there remains a subtle mythology about the place. Ex-employees speak readily about the smarts and zeal of the team, and you get the sense that in talking about their colleagues, they’re also talking about that version of themselves.

Ossip himself was heavily involved. Former employees praise his extreme drive and ability to focus, and cite his deep knowledge of the technology his companies sell. No detail was too small. He’d correct font sizes on PowerPoint slides before sales pitches to ensure they were consistent, Huber says. “He pushed me hard to do a great job, so when I didn’t get it right, he asked me to do it again,” Kovitz says. She credits what she calls Ossip’s “ethos around excellence” for inspiring her own entrepreneurial drive. In January 2017, she launched #movethedial, a company that created programming and content aimed at increasing the representation of women in tech, particularly in leadership positions. Ossip was one of the first people to support her new initiative. “Ceridian wrote me the first cheque,” Kovitz says.

Ceridian CEO David Ossip (left) with CTO Ozzie Goldschmied, who also worked with him at Workbrain.
Ceridian CEO David Ossip (left) with CTO Ozzie Goldschmied, who also worked with him at Workbrain. Ceridian

Ozzie Goldschmied worked with Ossip for over 15 years across three companies. “The greatest thing about David is his willingness to be direct,” says the Ceridian co-founder and former CTO. “It might not always come at the right time, but you will know where you stand.” It’s the radical candor that swept tech industry boardrooms a few years ago, after former Google executive Kim Scott wrote a book about it—only Ceridian’s CEO has been doing it for decades. “I believe in transparency,” says Ossip, who says you can’t get performance out of a “gold-star culture,” where people are told they’re doing well even when they’re not. And at his companies, he says, the feedback runs both ways. “I don’t consider myself above anything.”

In 2006, Workbrain was set to lose the Formica account to Kronos, which had promised the countertop company a shorter implementation. In an aside on an internal conference call, Grunberg told Ossip they could match their rival’s timeline. “He went off mute and said, ‘Neil and I are going to do the implementation. We’ll show you that it can get done in eight weeks. Meeting’s over,’ and hung up,” Grunberg recalls. Ultimately, Ossip’s intervention led to a new rapid-implementation program.

Staff occasionally had to rein in his desire to step in. Ossip “always had to be the smartest guy in the room,” says Huber. But clients didn’t always want to see a CEO they’d just met correcting a sales engineer they knew well, in the middle of a demo. With “a bunch of good old boys from Texas who were selling oil-and-gas-industry-type stuff … [an executive] coming down here from Toronto might not go well.” Once he’d explained it, though, Ossip understood, Huber says.

“That was my first real taste of what a performance-based culture is like. It wasn’t about seniority,” says Vanessa Brangwyn, who joined Workbrain’s training department as a coordinator in early 2005 on a break from a psychology PhD; she never finished it. She moved over into sales, then up into a leadership role. She’s tried to keep up that practice of providing career-development opportunities at Achievers, the Toronto-based employee-recognition platform where she’s chief customer officer, running a 120-person sales division.

The Workbrain Fusion, the company’s rec hockey team, in 2003.
The Workbrain Fusion, the company’s rec hockey team, in 2003. Photo courtesy of David Stein

Workbrain’s staff were a young crowd. Stein, Debow and Chapman were in their mid-20s when the company began, and Ossip himself was only 33. “It was a place where you could safely have a director or a VP title at that age, and it wasn’t because you were the son of the owner,” says Hartshorne. Still, Goldschmied says, “a lot of people did burn out.” Ossip attributes some of the turnover to bringing in bright college kids; after a few years at Workbrain, many decided to return to school for graduate degrees. Dayforce, his next startup, which mounted a reverse takeover of Ceridian in early 2012, looked for a bit more experience and stability, and attrition at the combined firm has been lower.

“Workplace cultures were a lot different than they are now,” says Cleary, later Ceridian’s CMO. Compared to the dot-com era’s hard-driving, hard-partying teams, today’s most-lauded startups are learning to balance hours at the office with the personal needs of their staff. Workbrain’s culture was as much fun as it was intense—and most importantly, they’d chosen to be part of it. “We came out of the generation where our parents worked very hard, and we were determined to work harder,” says Cleary. “But we’d play hard, as well.”

***

That culture changed dramatically after Infor Global Solutions acquired Workbrain in an April 2007 deal that valued the company at $227 million.

Ossip and others say it was time to sell. Over Workbrain’s three years as a public company, revenue had nearly doubled. But growth then slowed, especially compared to the go-go-go days before the IPO, and large, consistent profits proved hard to produce. “We ran out of market, and the technology didn’t scale down-market,” says Ossip. Clients needed capable IT departments to run the software, and companies with workforces under 50,000 typically didn’t have those resources. In turn, customers’ numerous requirements made it hard for Workbrain to expand its margins, even as it kept adding accounts.

The workforce-management market was also heating up, with a revived Kronos competing for business, and enterprise software giants such as SAP, JDA and Oracle snapping up HR tech firms. Workbrain’s flat stock price and listing on a Canadian exchange made it difficult for the firm to participate in the deal-making rush. “We were pretty proud that we’d created a US$100-million-revenue business,” says Chapman, now a partner at Toronto private equity firm TorQuest. But Workbrain was “a little bit too small and not quite richly valued enough to really be aggressive as an acquirer.”

Instead, the company sold to Infor. Hartshorne, who stayed for a few years under the new ownership, calls it “a giant accounting experiment.” Infor’s private equity backers were buying up dozens of companies, planning to “trim out all the fat, stitch this together and then IPO it.” Workbrain was just the latest piece in that plan, which didn’t leave much room for its people, who were accustomed to a fast-paced, growth-minded culture.

Infor cleared out the top executive ranks within the first week, then worked its way down the organization, with layoffs every quarter as the financial crisis halted its IPO plans. “At the top level, [they] had no idea how special the team at Workbrain was,” says Goldschmied. The new parent organization’s staff cuts and ways of doing business would eventually send scores of young and ambitious employees out into Canada’s tech ecosystem.

***

Workbrain’s end as a company marked a number of beginnings. Today, Workbrain is well represented in the corner offices and cap tables of some of the country’s most promising scale-ups and successful tech companies.

Workbrain: Where they are now

James Moncarz
Then: Senior Functional Consultant
Now: Vice-President of Partnerships, 7shifts
Moncarz left Workbrain to get a master’s degree, then worked for HR tech firm Versult and its acquirer Ceridian. He was also an executive at learning platform Docebo before its 2019 IPO.

Jodi Kovitz
Then: Marketing Coordinator
Now: Founder and CEO, #movethedial
Kovitz went on to law school and roles at Torkin Manes and Osler before starting #movethedial in 2017. The company paused operations in March, citing the pandemic.

Raymond Nunn
Then: Vice-President and Co-Founder
Now: CEO and Founder, Covalence Consulting
A founding member of the Workbrain team, Nunn went on to start Versult, which he sold to Ceridian in 2011. His latest company, Covalence, is an HR software-consulting company.

Tim Lett
Then: Vice-President of Professional Services
Now: CEO, Torlins
Alongside Workbrain colleagues like Ben Zifkin, now CEO of Toronto-based scale-up Hubba, Lett co-founded HR tech-consulting firm Axsium Group, which Knightsbridge acquired in 2008.

Jeff Elder
Then: Senior Director of Research & Development
Now: Vice-President of Product Development of Askuity, Home Depot
A Workbrain founding executive—his brother Brad also worked there—Elder went on to Vortex Connect with Grunberg, then Toronto content-marketing firm ScribbleLive before Green’s Askuity.

Sanjiv Samant
Then: Communications, Media & Technology Investment Banking, RBC Dominion Securities
Now: Managing Partner and Founder, Round13Growth Fund
Samant was a prolific public-market transaction maker for Canadian tech at Genuity Capital Markets, Canaccord Genuity and National Bank before joining VC firm Round13 Capital in January.

Chad Bayne
Then: Junior Associate, Osler
Now: Partner and Co-Chair for Emerging and High-Growth Companies, Osler
Bayne is Canada’s top tech lawyer, advising on deals like Verafin’s US$2.75-billion buyout by Nasdaq and fundraising rounds for the likes of ApplyBoard and Wealthsimple.

Some alumni hold executive roles at fast-growing firms. James Moncarz says the year and a half he spent in Workbrain’s professional-services group set him on his current career path. “It taught me the value of having domain expertise,” he says. “We were all focused on this weird [world of] workforce management, time, scheduling [and] payroll.” He’s now vice-president of partnerships at Saskatoon-headquartered 7shifts, an employee-scheduling platform for restaurants, one of a promising crop of tech firms on the Prairies.

Daniel Huber joined a bid to build “the AI version of what we did with Workbrain” in the fragmented emerging market for machine learning products. He signed up at Montreal-based Element AI as sales vice-president in February 2018. Santa Clara, Calif.-based ServiceNow acquired the company this November after it struggled to turn its research into products and revenue. “I wanted to see millionaire receptionists from Element AI in Montreal,” says Huber. “And that’s not how it panned out.”

Several former Workbrain staff started their own ventures. Like Jodi Kovitz, Neil Grunberg says his former boss supported his entrepreneurial efforts. After he and his co-founders started AlayaCare, David Ossip met with them every few weeks for several months “just to give us advice [and] work on our deck,” recalls Grunberg; there were no strings attached. “Maybe I bought him a coffee one more time than he bought us.”

Martin Hartshorne, who ran technical sales and services at Workbrain, launched a startup, too, but had a slightly different experience. After leaving Infor in mid-2011, he started EmployTouch to make tablet-based time clocks. Seeking a partnership with Dayforce, he took a meeting with Ossip. “I knew he was impressed, which was important to us,” Hartshorne says. “But also, he [said], ‘Marty, I’m either going to copy it or buy you.’” (Ossip disputes Hartshorne’s account of the meeting, saying Dayforce wanted a more purpose-built device than EmployTouch was offering.)

Ultimate Software, then a publicly traded HR software giant, later acquired EmployTouch. Hartshorne rose up the executive ranks to chief strategy officer at Ultimate, working on the firm’s recent merger with old rival Kronos. “Over the past five years, David has been an archnemesis for me,” Hartshorne says, citing “a bitter rivalry” between Ceridian and Ultimate. But crucially, there’s “also a respect.”

Several former Workbrain employees started companies together. Business development vice-president Eric Green “caught the entrepreneurial bug” at Workbrain. He left post-IPO, launching and selling a cleaning-products company. Green and former Workbrain colleague Neal Sherman later started Askuity, a retail-analytics technology company that The Home Depot bought in December 2018.

The team at Rypple’s Toronto office including co-CEOs and former Workbrain executives Daniel Debow (top row, first from left) and David Stein (middle right) on the day its acquisition by Salesforce was announced in 2012.
The team at Rypple’s Toronto office including co-CEOs and former Workbrain executives Daniel Debow (top row, first from left) and David Stein (middle right) on the day its acquisition by Salesforce was announced in 2012. Photo courtesy of David Stein

Shortly after the Infor takeover, Daniel Debow and David Stein, at this point friends for decades, started Rypple, a Toronto-based performance-management software company. The co-CEOs recruited heavily among their former Workbrain colleagues. Stein points out that startups succeed on speed, and it helps to work with people you trust, and know can deliver results, and with whom you have a “shorthand of communication.” “For me, the second company was to prove to myself, quite frankly, that I could do it twice,” he says. “Do you have the drive, the motivation? Can you persist?”

In December 2011, SaaS giant Salesforce acquired Rypple. Stein and former Workbrain COO Stephen DeBacco are now the managing partners of Leaders Fund, a VC firm launched in early 2016 with backing from mining magnate Seymour Schulich, Stein’s father-in-law. Portfolio companies include well-known Toronto-area scale-ups like Top Hat and 360insights. Most Canadian VCs are “professional investors—they [don’t] have experience building technology companies,” says Stein. Leaders aims to channel the lessons of its partners’ time at Workbrain and Rypple to young founders, so they can avoid mistakes and grow faster.

Both push back against the common lament that Canadian companies sell out too soon. “David’s got Ceridian; it’s a massive company,” says Debow, a busy angel investor and now an executive at Shopify, the current titan of Canadian tech. “There’s so much else [that came from Workbrain]. It was because we sold ‘too soon.’”

Many former Workbrain employees and associates see more runway for Canada’s current tech frontrunners than in that post-dot-com-bubble slump. “Companies now are very much focused on … how big they can actually get,” says Chad Bayne, who worked the Workbrain IPO as a junior associate at Osler in 2013. “And they’re trying to bite off much bigger markets.” Private capital is much more readily available, so companies can wait until they’re big and ready before listing, says Bayne, now a partner and the country’s top tech-deal lawyer. “The SaaS model takes your initial success and propels you in a way that we didn’t have [at Workbrain],” says then-general counsel Richard Guttman, now AlayaCare’s chief legal officer. “We had to recreate our customer base each time.” And he notes there are now more repeat entrepreneurs with deep industry knowledge, trying again at a larger scale.

South Africa-born Ossip, now 54, is the poster child for this model. He’s sold four companies and taken two public in Canada; run startups that were variously bootstrapped, venture-backed and private equity-owned; and led a workforce of zero and one of 5,000-plus. “He’s a huge, huge success,” says Round13’s Samant.

Ceridian staff including CEO David Ossip (centre) and CMO Kristina Cleary (second row, third from left), both former Workbrain executivees, open the market on the day of the firm’s initial public offering in May 2018.
Ceridian staff including CEO David Ossip (centre) and CMO Kristina Cleary (second row, third from left), both former Workbrain executivees, open the market on the day of the firm’s initial public offering in May 2018. Photo: TMX Group TMX Group

More than three-dozen ex-Workbrainers work at Ceridian today, according to LinkedIn data. In April 2018, the company raised more than US$560 million, in what was at the time the largest tech listing in TSX history; the price of the stock, also listed on the New York Stock Exchange, has quadrupled since, giving Ceridian a market cap of US$16.3 billion in late December.

But on the question of whether the country can build a lasting tech sector on top of today’s scale-ups, Ossip is circumspect. Three years ago, “I would have been very optimistic about the ability to create a scaled, innovative company in Canada,” he says. Today, “it’s actually very difficult.” He sees a longstanding bias against domestic companies, citing Workbrain’s inability to sell to Canada Post, even as it signed up the Australian equivalent; left unsaid is that the federal government recently picked Germany’s SAP over Ceridian for an early pilot project in its bid to replace the public-service payroll system.

Ossip also sees a talent gap. “The real reason, I would say, that we sold Workbrain came down to a management glass ceiling,” he says now. To scale beyond a few hundred million dollars in revenue, companies need executives with experience at scale. That means recruiting abroad, but “we can’t attract people because we can’t pay them competitively,” he says, citing higher income tax rates than in the U.S. and Ottawa’s proposed stock-options cap for employees at firms with more than $500 million in annual revenue. (Ceridian, which will be affected by the rule, recently hired a new chief financial officer from SAP and a chief product and technology officer from Workday, both in the U.S.)

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“Great work on creating a whole generation of really capable technologists and innovators that are able to grow businesses to a certain scale,” says Ossip. “But when those businesses get acquired—and most companies do get acquired—have we created the environment that they are going to start over here?” Sitting in his Toronto home office in a Ceridian T-shirt, in front of a bookcase dotted with Workbrain memorabilia, Ossip believes he’s increasingly an exception. “I’m not really confident that we’ve done that. In fact, I think we haven’t.”

Grunberg may be another such exception. He’s on his second startup, AlayaCare, but regularly drives past the tower that housed Workbrain’s former Toronto office and once bore its curly “O” logo, just off Don Mills Road and Eglinton Avenue. He can see it from the Don Valley Parkway on his way to his new company’s office downtown. “Terrible location, boring building,” he says. “But it created so much value for so many.”

Clarification: This article has been updated to reflect SAP’s role in the federal government’s payroll system procurement.