Minister Valdez announces new investments to help diverse entrepreneurs grow their businesses
October 11, 2023 – Halifax, Nova Scotia
Investments and access to capital are key to growing and supporting small and medium-sized enterprises (SMEs) with high-growth potential. This is especially true for entrepreneurs who have traditionally been under-represented in the venture capital (VC) space, including women and members of Indigenous, Black and 2SLGBTQI+ communities. When we support our small businesses, we’re supporting a strong economy that will help create good middle-class jobs for Canadians.
Today, the Honourable Rechie Valdez, Minister of Small Business, announced an investment of up to $25 million in five venture capital fund managers as part of the inclusive growth stream of the renewed Venture Capital Catalyst Initiative (VCCI). The five VC funds managers are:
This is the first of two investments for the inclusive growth stream of the VCCI announced in Budget 2021. The inclusive growth stream will help advance diversity, equity and inclusion in the Canadian VC ecosystem by enhancing access to capital for diverse fund managers and Canadian entrepreneurs, so they can continue to transform new ideas into goods for Canadians, strengthen our economy and create good jobs.
As part of a combined $450 million investment into venture capital funds and funds of funds, the renewed VCCI is expected to inject at least $1.6 billion into Canada’s innovation capital market when leveraged with other public and private investments. A second call for expressions of interest for another round of investments of $25 million is ongoing and will close on November 22, 2023.
Each recipient will be required to report their progress on enhancing diversity and gender equality across the VC ecosystem. This will help ensure that more firms owned by women and other members of under-represented communities in the SME space have access to the capital they need to scale and grow, and it will strengthen Canada’s economy.
“Supporting inclusive growth in the venture capital sector ensures that entrepreneurs and start-ups led by diverse individuals receive the investments that they historically haven’t been granted simply because of their identity. Our government is committed to giving everyone a fair chance at bringing their passion and innovative ideas to the table. We’re making more capital available to firms led by women and other members of under-represented communities, and this will in turn accelerate the development of the next generation of bright and diverse Canadian entrepreneurs and innovators.”
– The Honourable Rechie Valdez, Minister of Small Business
“For an economy to reach its full potential, everyone needs to participate. Women entrepreneurs, when given a fair chance, significantly outpace their peers in terms of business growth and return on investment. Today’s announcement will ensure women-focused venture capital funds like Sandpiper Ventures can continue to stimulate economic growth right here in Atlantic Canada in a demographic that consistently punches above its weight. These crucial start-up investments will ensure all Canadians get a fair chance at succeeding.”
– Andy Fillmore, Member of Parliament for Halifax
Together with investments from the private sector, the renewed VCCI is expected to inject around $1.6 billion into Canada’s innovation capital market.
The recipients announced today were chosen as a result of a rigorous selection process informed by a private sector selection committee of highly qualified industry experts, as well as experts at the Business Development Bank of Canada (BDC) and Innovation, Science and Economic Development Canada.
The second intake of the inclusive growth stream (investment of up to $25 million) call for expressions of interest is open until November 22, 2023.
In 2021, Canada’s VC industry invested $15.1 billion across 805 deals, more than double the previous record set in 2019.
Canada ranks in the top five in terms of VC investment as a percentage of GDP, according to the Organisation for Economic Co-operation and Development (OECD).
The Government of Canada also recently launched the Inclusive Women Venture Capital Initiative under the Women Entrepreneurship Strategy. This $15 million initiative aims to strengthen the VC environment for Canadian women entrepreneurs and make it more inclusive, and it will support projects that help strengthen the capacity of women entrepreneurs to access VC funding, contribute to the increasing representation of women in the VC industry and help ensure that the VC industry is sensitive to gender and potential unconscious bias.
BDC, which manages the VCCI, is Canada’s most active single VC investor, managing over $4.2 billion in VC investments. BDC is also increasing VC investments to help increase diversity in the area, having recently launched its $500 million Thrive Venture Fund and Lab for Women, the largest investment platform of its kind in the world.
Director of Communications
Office of the Minister of Small Business
Innovation, Science and Economic Development Canada
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