Venture Capital Catalyst Initiative Announcement

Speech

Speaking Notes

The Honourable Navdeep Bains, MP
Minister of Innovation, Science and Economic Development

Toronto, Ontario
December 18, 2017

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Thanks, Whitney [Rockley, co-founder and managing partner, McRock Capital], and good afternoon, everyone.

Special thanks to Hubba for hosting us here today.

Hubba is only a little more than five years old, but this company is making magic happen by introducing consumer product makers to retailers.

Its clients—which include Unilever and Wal-Mart—benefit not just from the matchmaking, but also from standardized product information and much more.

You all know that innovation was our government’s commitment in Budget 2017.

Our budget included an Innovation and Skills Plan with major investments in Canadian skills-building, research, technology development and commercialization.

We know that innovation is the path to job creation in Canada.

Not only that, but innovation is necessary for business growth, for global competitiveness and for cleaner, more sustainable communities.

All of our government’s investments are designed to position Canada as a world leader in innovation and to encourage the kinds of advances and breakthroughs that will drive the global economy in the next decade.

Innovation needs all hands on deck.

We need a diversity of opinions and thoughts.

And we need fearless Canadians who have bold ideas and aren’t afraid to fail quickly and learn fast.

Innovation needs talent.

That’s why we launched the Global Skills Strategy, which helps Canadian companies hire qualified global talent faster.

We’re also investing in our youth through digital skills and coding training and thousands of work-integrated learning internships.

Innovation also needs collaboration—from academia to start-ups.

Our Innovation Superclusters Program will invest in business-led “hotbeds” that bring the strongest of Canada’s research, tech development and commercialization together, growing the economy and creating jobs.

Innovation definitely needs investment and funding to scale up.

Without venture capital and other forms of investment available to small businesses, we wouldn’t have success stories such as Hubba, which has raised more than $50 million in venture capital.

We wouldn’t have Shopify, which has grown from its Ottawa roots to dominate the global e-commerce market.

We wouldn’t have Vancouver’s Zymeworks, which went public this year and is working on promising treatments for cancer and other major illnesses.

You know, I’ve travelled our country from coast to coast listening to businesses and their needs.

Consistently, I heard that attracting investment is crucial to supporting the growth of our best and brightest companies and start-ups.

That’s what today’s announcement is all about.

The Venture Capital Catalyst Initiative, or VCCI, was announced in Budget 2017 with a $400-million funding commitment from our government.

VCCI will match every dollar of Government of Canada funding with at least an additional dollar—and sometimes more than two additional dollars—from the private sector and other sources.

That means that VCCI could inject up to $1.5 billion into Canada’s capital markets to support innovation and to support the talented Canadians working in these growing companies

Today, I am pleased to announce that the call for proposals for VCCI is officially open for members of the venture capital community.

This means that venture capital fund managers can now apply for some of that $400 million in funding from the federal government.

In order to be eligible, the applicants must show how they’ll use the funding and how they’ll get more from the private sector for even greater economic benefit.

Our government is also committed to equality and diversity in all our programs.

So when fund managers submit their applications, they must include a proposal that outlines how they’ll use VCCI funding to work toward gender balance and enhance the diversity of their firms and their investment portfolios.

Because as I said earlier, Canada will only succeed if our decision making is informed by a wide range of perspectives from diverse groups.

The second piece of news that I’d like to share with all of you is that we’re setting up a selection committee to help evaluate funding requests from venture capital fund managers.

Until January 15, 2018, we’ll be accepting applications for membership on this selection committee.

Ladies and gentlemen, this is government programming at its best.

Our government is creating the framework for success with initial funding… then getting out of the way to let professionals in the venture capital industry raise additional money and make the investment decisions.

We’re taking this approach because we want the best selection committee to ensure we make the best investments possible.

We believe in industry and the many talented Canadians that work in it.

We want to actively partner with the venture sector—knowing it will lead us to the best Canadian innovation.

Ladies and gentlemen, the pace of venture capital investment in Canada has grown each year since 2009.

In 2016 we saw the most venture capital invested since 2001.

This upward trend means that Canada’s economy is growing, and the need for funding to fuel that growth is essential.

VCCI is the funding boost the industry needs.

It will help firms grow their operations—for example, by hiring more staff or making inroads into export markets.

Through today’s investment, our government is ensuring that Canada’s economy continues to lead the world in growth and that it continues to provide the world with innovative products and solutions to improve communities everywhere.

I’d like to now turn things over to my colleague, the Honourable Bardish Chagger, Leader of the Government in the House of Commons and Minister of Small Business and Tourism.

Thank you.


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