Our roundup of the biggest Angel Investment, VC, and government funding news to impact Canada’s technology sectors so far in 2018.
2018 hit it off with a few announcements from the Canadian government and big banks aiming to impact technology startups—as close to home as the Alacrity Canada’s office right here in Victoria.
This January, two major Canadian banks announced funding programs to support technology startups in Canada and the United States.
On January 8, CIBC introduced Innovation Banking, which provides funding and advice to businesses from the startup stage in both countries. They also acquired Wellington Financial, a Toronto-based bank institution that controls a $300-million fund oriented towards early and mid-stage technology companies.
Ten days later, the Canadian Minister of Innovation, Science, and Economic Development Navdeep Bains announced the Federal Government’s plan to give $700-million over the next five years to the Business Development Bank of Canada. The contribution aims to encourage growth in cleantech technology companies across Canada.
In line with the announcement from federal minister Bains, Minister of Small Business and Tourism and Leader of the Government in the House of Commons Bardish Chagger announced a $785,000 investment from the Government of Canada to the Alacrity Foundation of B.C. The announcement, which took place here at the Alacrity offices on January 22, will enable Alacrity to better support the 270 B.C. clean technology companies as they expand in the growing global market and connect with investors.
Regarding this important announcement, Alacrity Canada Chairman Owen Matthews stated: “This funding will enable companies in the clean tech sector to expand their opportunities, leave a lasting impact on business in British Columbia, and contribute to a cleaner world for the future.”
AngelList, an online platform for startups and angel investors, also announced a funding program for founders looking to participate as angel investors.
On January 9, AngelList and the Boston-based VC firm Accomplice partnered to launch Spearhead, a $35-million fund with aims to support and advise founders on angel investing—and Canadian founders are encouraged to apply. AngelList believes that “more founders should invest and be given an opportunity to back remarkable companies” in spite of lack of accreditation or personal capital.
Spearhead provides accepted founders with $200,000, 15% carry, legal and backoffice support, as well as masterclasses and mentorship from experienced angel investors and VCs. Founders can access up to $1 million in investment capital over two years if their initial investments are deemed promising.
Applicants are expected to run their companies concurrently with Spearhead. Even though Spearhead is a free program, founders are expected to invest at least 1% of the total fund size if they are accredited enough liquidity.
Competition for selection by Spearhead is stiff thus far, with 1500 applications having been submitted for the 20 spots in the first cohort. Preference is being given to tech company founders who are experts in their field, are creating compelling startups because of their expertise and reputation, and have a competitive, fast-paced approach to their company, market and opportunity.
Navdeep Bains, Minister of Innovation, Science and Economic Development made one more major announcement that will impact Canada’s technology sectors nationwide, selecting the winners of its $950M ‘Supercluster’ competition – including the BC-led Digital Technology Supercluster.
2018 has also seen several investments in Canadian startups, including the following:
Ratehub, a Toronto-based startup, secured $12.5 million of investment on January 15th. The investment was led by Elephant, a Boston-based VC firm, with further participation from Simon Nixon, co-founder of UK-based MonkeySuperMarket. With a long-term goal to be the leading source of financial information for Canadian consumers, Ratehub finds and compares the most competitive mortgage rates in Canada.
Drop, a Toronto-based fintech startup, secured $25.8 million of investment on January 30th. The investment was led by New Enterprise Associates, with further participation from Sierra Ventures, White Star Capital, ff Venture Capital, Portag3 Ventures and Silicon Valley Bank. The 30-person early-stage startup also brought Ian Logan, former head of engineering at AirBnb, into the firm as their new engineering VP. Users link their credit and debit cards to Drop to access a rewards program through popular retailers.
mnubo, a Montreal-based startup, secured $16.5 million of investment on January 30th as well. The investment was led by the Munich Re HSB Group with further participation from White Star Capital and McRock Capital. mnubo’s SmartObjects IoT platform analyzes data via smart device sensors to provide manufacturers with information about how people use their products.
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That was some of the biggest Angel Investment, VC, and government funding news to impact Canada’s technology sectors thus far in 2018. Stay tuned for our next roundup to learn more, and check the wide selection of other articles on our blog designed for both angel investors, and startup founders.