Over the last two years the likes of Appen Ltd (ASX: APX) and Altium Limited (ASX: ALU) have gone from being small cap shares flying under that radar to billion-dollar tech companies.
While not all fledgling tech companies are destined to have as much success as these two, I think there are a number of quality shares at the small end of the tech sector to keep a close eye on.
Three worth watching are listed below:
Bravura Solutions Ltd (ASX: BVS)
I think that this fast-growing fintech company could have a bright future ahead of it due to its popular wealth management software product Sonata. Demand for Sonata has been growing so strongly that it accounts for 55% of the company's total revenue as of its half-year results. Furthermore, this demand recently led to management upgrading its full-year underlying earnings per share growth guidance to the high-teens. I think its shares are good value based on its current growth profile.
ELMO Software Ltd (ASX: ELO)
Another top small cap tech share that I think investors should look closer at is this cloud-based talent management software solutions provider. Growing demand for its software solutions has led the company to outperform expectations and smash its prospectus forecasts. Last month the company's half-year results came in ahead of expectations, leading to a full-year guidance upgrade. This strong performance allowed the company to raise $40 million through an institutional placement this week. The company plans to use the funds for future acquisitions, to strengthen its balance sheet, and for general corporate purposes.
Livetiles Ltd (ASX: LVT)
This digital workplace platform provider aims to gain a leadership position in the artificial intelligence market and has been making great strides in achieving this. Last year the company announced agreements with Microsoft and Clean Energy Smart Manufacturing Innovation Institute in the space. The Microsoft agreement will see the company's LiveTiles Bots product promoted to the tech giant's business customers. I'm holding off an investment until I see the kind of revenue these agreements produce, but I do think it is one to watch closely.
