With mobile devices consuming more and more of our time, the pressure for constant Wi-Fi has wireless access points buckling at the increasing demand. Instead of fighting the problem by adding additional routers, Ottawa company Edgewater Wireless Systems (V. YFI) has a different approach. Its solution: multichannel access points that can handle venue-sized traffic loads without dropping speeds.
Wifi3 is the name of this solution from Ottawa-based wireless tech manufacturer Edgewater Wireless Systems, and its goal is to solve the issues of high-density Wi-Fi. Its product looks to save businesses the cost of buying multiple routers or access points by providing the same service from a single terminal. Its line of products offer three to 12 channel Wi-Fi, as well as the infrastructure to control these access points. Edgewater is also releasing IOTair its platform built with the Internet of Things in mind.
The company has targeted large telecoms, service carriers, large enterprises and venues for its products, throughout Europe, Asia, the Americas, and North America.
Edgewater Wireless Systems is run by an experienced team lead by CEO Andrew Skafel, who brings leadership experience from companies like Newbridge Networks and InterWAVE Communications. CFO Robert Harper specializes in public markets and has worked with early stage companies for decades. John Prokopenko, VP Engineering brings an understanding of tech from his time at IBM and Bell Northern. But the major creative force at Edgewater Wireless Systems is Chief Technology Officer, former CEO and founder Duane Anderson.
“When we restructured he took temporary role as CEO, when we needed the push he rolled up his sleeves and dived deep into tech,” says Skafel. It was also this deep dive into tech that revealed Edgewater Wireless Systems had an exclusive patent for multichannel Wi-Fi, “Duane spent a year delving into patents to see what we had.”
The company is still in its development stage and with shares currently trading at $0.26. Edgewater posted a net loss of $513,194 for the quarter ended July 31 2015 (Q1 2016) with revenues totaling $58,806 and cost of sales and expenses reaching $545,885. This loss is a slight improvement over a net loss of $647,900 in the previous quarter. The company also opened and closed a fully subscribed non-brokered private placement, raising net proceeds of $1.7 million. This brings the total of the company’s cash and cash equivalents to $2.4 million at the end of the posted quarter.
Created from a reverse takeover
Edgewater reached this point after a reverse takeover of KIK Polymers Inc. in late 2011, with the newly named company’s initial value at about $0.40 per share going into 2012. By January 2013 Edgwater shares had fallen to about $0.05, and stayed around this price until January 2015.
It was around this time that Duane Anderson discovered the company’s exclusive multichannel Wi-Fi patent and Edgewater narrowed its focus to WIFI3, boosting its share price to $0.30 in April. That went even higher in May when Edgewater formed a strategic alliance with Zinwave, sold one of its patents to a major tablet developer and announced it was working with a Fortune 500 company. The stock peaked at $0.59 in late May, eventually coming down to $0.26 as of December 15th.
The issue appears to be an oversaturated market as Esme Vos, founder of media company and advisory firm MuniWireless, describes it. “It’s a niche market right now. There are simply too many larger companies in the space for them to break through. If you ask people here in California they haven’t heard of Edgewater yet,” says Vos, explaining the disparity between Edgewater’s $0.26 compared to Cisco’s $26.00 per share. “If this was 2003 I’d be extremely hopeful, but the market is completely different now.”
Access to capital is key
Skafel counters this with the company’s unique advantage in the market, “All vendors in the market implement a solution based on the same single channel architecture, we are the only company that can produce multichannel Wi-Fi.”
“There’s investing and there’s speculating,” says Bill Lawson, finance professor at Carleton University in Ottawa. “They have good prospects but it’s far too early to judge. Tomorrow this company could blossom but tomorrow may never come. Its stocks are peanuts right now.”
Skafel is optimistic for the company’s future though, speaking about next year’s plans: “We see huge potential for growth in India. We want to move that forward. We’re also looking to hit a major milestone with our Fortune 500 partner and augment our OEM as well as adding OEM partners,” said Skafel.
Asked what obstacles Edgewater faced, he answered simply, “Access to capital. You can do many things but you need access to capital We need to prove ourselves to the market.”
After a successful year Skafel wants to keep the ball rolling, “For us the tech space is moving so fast, we just want to maximize our returns and get our technology in as many hands as possible.”