Okanagan tech company Mazu jeopardized by stalled funding, says owner

Mazu staff face missing second paycheque in January

A Kelowna entrepreneur says the future of a website she created to provide a safe online place for youth has been put in jeopardy.

Mazu CEO Janice Taylor said her 20 staff have already missed one paycheque this month and will likely to receive another come their next payday on Friday due to the Southern Interior Development Initiative Trust creating a roadblock to funding.

The absence of a signature on an agreed loan extension agreement with SIDIT threatens to collapse Mazu’s support from other investors and force the company to close its doors.

Taylor feels she had no other option but to go public to the local media Wednesday with her frustration over her dealings with SIDIT, despite the fact she already has been threatened with legal action in a letter from SIDIT acting board chair Grace McGregor for any comments “malicious and defamatory of SIDIT or its staff.”

RELATED: Recognition for Mazu founder and CEO

Taylor says there have been changes with the SIDIT administrative staff, including three different CEOs since August 2017, that has led to her company’s financial structure and intent being misrepresented to the board, and she claims to have had no opportunity for the board or staff to better understand either Mazu’s current financial status, private investment support or long-term revenue objectives since the loan renewal talks began last September.

“We have an agreement to extend the loan for three years so all we need is a signature on the document for that agreement and we can carry on,” Taylor said.

“Instead, I am hearing around town how we have defaulted on our loan and that is absolutely not true and an irresponsible statement.”

Taylor’s involvement with SIDIT dates back to 2013 when she received a $200,000 seed money investment from the development initiative trust to grow her company as a five year loan.

She made interest payments totalling $87,000 with the option after five years for SIDIT to demand repayment of the loan principal amount or invest it as shares in the company.

At the time, Mazu was valued at $2 million, and has since grown in equity value to $18 million with more than 70 private investors, including some of the staff.

Taylor says the loan extension agreement was for a further 3.5 years under the same conditions.

But Taylor says the hangup in the deal centres around a subordinate clause, in which SIDIT would not be classified as a tier 1 lender under the agreement, allowing other tier one investors, such as a bank or other private financial lending institution, to get first priority in getting paid out if Mazu was to fold.

RELATED: Safeguarding youth from Internet addiction

Taylor argues that as a public trust, SIDIT should not be looking for a quick turnaround profit, but provide a long-term investment that will help companies to grow and generate jobs for their local economies.

“We are the poster child for everything that SIDIT claims to be in their own strategy policy. It was set up for companies like us, particularly those in high-tech that have an idea and need time to go through the ups and downs in figuring out how to turn it into a revenue generating business,” she said.

“We have job growth, are attracting investment, in the last five years gone from 15 to 20 employees, been involved in university co-op programs with students and ended up hiring two as full-time staff. This should be a win-win situation for everyone going forward and instead we have our own version of the wall here where my staff are not getting paid.”



barry.gerding@blackpress.ca

Like us on Facebook and follow us on Twitter

Just Posted

Death Café returns to Okanagan

Vernon, Kelowna and Summerland events toast touchy subject

Highway 97 rock slide north of Summerland beginning to stabilize

Costs of road work so far estimated at between $300,000 and $350,000

Fentanyl, cocaine, body armour seized in Vernon suspected ‘dial a dope’ arrests

Five people suspected of being involved in a dial a dope operation arrested

More snow on the way for Okanagan-Shuswap

Up to 5 cm of the white stuff could fall across the Okanagan - Shuswap on Friday

SilverStar’s historic green chair up for auction

Mountain celebrates Emergency Service providers Saturday with fundraiser for firefighters

Vernon art gallery turns out the lights and throws a party

DJ, drinks and food at Art After Dark Feb. 23

Expect delays on Highway 1 west of Golden due to vehicle fire

Expect delays while driving Highway 1 between Golden and Revelstoke. Drive BC… Continue reading

Eight cases of measles confirmed in Vancouver outbreak

Coastal Health official say the cases stem from the French-language Ecole Jules Verne Secondary

Semi loses control on Highway 97A in Shuswap

Slippery roads contribute to crash of transport truck carrying tires

Plecas won’t run in next election if B.C. legislature oversight reforms pass

B.C. Speaker and Abbotsford South MLA says he feels ‘great sympathy’ for Jody Wilson-Raybould

Infighting at Kelowna Yacht Club makes it to court

Marc Whittemore, a local lawyer and prominent member of the club, filed a notice of civil claim Feb. 1

Workshop with ‘accent reduction’ training cancelled at UBC

The workshop was cancelled the same day as an email was sent out to international students

Former B.C. premier Gordon Campbell accused of sexual touching

Accuser went to police, interviewed by Britian’s Daily Telegraph

Most Read