Raonic is ranked 32nd in the world which is vastly different than last year when he came into Delray Beach ranked fourth on the men's ATP Tour.
Injuries limited Raonic's time on the court in 2017 and this was just his second tour-level win in six months.
So his straight set victory on Tuesday against Japan's Daniel is a sign of better days ahead as he seeks his ninth career Tour title.
"I just got to keep building day-by-day and working my way into it and just try to get in as many wins as possible. That's the most important thing."
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Raonic has some unfinished business in Delray Beach. He advanced to the title match last year but hand to pull out against American Jack Sock because of a leg injury. He could meet Sock in the semi-finals of this event if they both win their next two matches.
"Obviously having not played a lot of matches I was going in and out a little bit with my focus and my intensity," Raonic said. "I've got to be a bit more consistent and disciplined with that."
Raonic will next face American Steve Johnson, who had lost eight of his past nine matches before ousting Georgian Nikoloz Basilashvili 6-3, 6-4 in 71 minutes.
That shouldn't be a problem for the hard-serving Canuck as he has won all three of his previous matches against journeyman Johnson.
The 18-year old Shapovalov was just one-year old when Karlovic, 38, won his first Davis Cup match (2000) for Croatia.
Sixth seed John Isner also got back on track in Delray Beach, avenging his loss against Moldovan Radu Albot at last week's inaugural New York Open with a 5-7, 6-3, 6-4 win.
The American will next face Peter Gojowczyk, who won in three sets against Lukas Lacko.
Wild card Reilly Opelka stunned fellow American Ryan Harrison 7-6 (7/5), 7-6 (8/6).