It’s not clear if Blouin’s “notably the United States” is a reference simply to the size of the US market’s potential, or if he is privy to a specific plan De Marque has in mind to go head to head with the established players in the US, but no question De Marque is now one to watch.
The big surprise in the De Marque announcement this week that it has picked up $5 million in new funding for its expansion aspirations is not the investment itself. Rather it’s the post-lockdown numbers De Marque is announcing.
Unlike some other platforms that have attracted new funding recently, De Marque still styles itself primarily as an ebook operation. That’s important because it’s been easy amid all the headline-grabbing excitement about the audiobook-first operators like Storytel to lose site of the fact that ebooks too have been booming in the Covid-19 era.
As the press release notes,
Over the past few years, De Marque has made several acquisitions including the digital activities of book distributor Prologue, Archambault’s MaBiblioNumérique e-lending service, Spanish ebook distributor Libranda, and more recently, French online bookstore Feedbooks and the Aldiko mobile reading application.
TNPS covered the De Marque buy-out of Feedbooks’ assets here.
In fact De Marque President Marc Boutet reports both ebook and audiobook downloads soared during lockdown:
A 35% increase in ebook sales to the general public and a 31% increase for audiobooks over the last nine months, compared to the same period the previous year.
Since then, we have observed a strong and ongoing trend in reading, as ebook sales have increased by 25-30% per week compared to pre-confinement.
Explaining that the $5 million deal (it’s not immediately clear from the press release whether this is CAD or USD) with the two Canadian investment banks BDC Capital and CIBC “allows De Marque to gain the best financial tools to support and accelerate its growth plan,” the press release goes on:
The context of the global health crisis created winning opportunities for the company.
No surprises there, except perhaps the blunt honesty of the statement. Boutet adds,
De Marque is positioned to maximise its development over the next few years, whether by acquiring new geographic markets, increasing our presence in the education sector or by catalysing our Aldiko brand with the general public.
I’ll come back on that below. First to hear from Charles Blouin, Director, Technologies Group, Growth and Transition Capital at BDC Capital’s Quebec City office.
De Marque is already the world leader in French and Spanish ebook distribution platforms. Now, it is carefully preparing to expand its presence into other markets, notably the United States. The customized financing we provided in collaboration with CIBC is designed to meet the requirements of rapid growth in the context of share transfers.
David Bouchard, Director at CIBC Commercial Banking added,
It is with great enthusiasm that the CIBC supports De Marque in achieving its ambitions and full potential in future projects. Its experienced management team can count on us to increase its position as a global leader in digital content distribution.
Let me wind up the press release summary with De Marque’s “about” statement.
De Marque is a leader in the distribution of digital cultural content, principally ebooks. Based in Quebec City, the company now distributes over 1.4 million ebooks marketed by more than 2,300 publishers in over 1,300 points of sale around the world. The company has also developed Cantook Station, an e-lending solution available in public libraries across Canada and Europe.
But as per Charles Blouin above, De Marque is foremost associated with French and Spanish-language content, and it is the pivot towards the US market that is most interesting about this news. Per Blouin,
Now, it is carefully preparing to expand its presence into other markets, notably the United States.
Obviously the Spanish-language content De Marque fields will help get a foothold in the US, but to be meaningful in what is the world’s most competitive digital environment it’s going to need De Marque to place an emphasis on English-language content.
That in turn will open up De Marque’s room for maneuver in many other markets.
It’s not clear if Blouin’s “notably the United States” is a reference simply to the size of the US market’s potential, or if he is privy to a specific plan De Marque has in mind to go head to head with the established players in the US, but no question De Marque is now one to watch.
We shouldn’t rule out possible further funding from outside Canada following this announcement, as global investors wake up to De Marque’s global ambitions.
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