Québec AI institute Mila and Montréal venture firm Inovia Capital have partnered to launch an early-stage venture fund as they seek to bridge a commercialization gap that has plagued Canada’s AI sector.
“We plant the seed, we water, we grow, and someone else harvests? It’s not going to happen anymore.”
AI minister Evan Solomon
Mila and Inovia announced the Venture Scientist Fund, a national initiative with a target amount of $100 million USD ($125 million CAD), today at Mila headquarters in Montréal. The fund aims to identify and back at least 55 “AI-native” startups by helping researchers turn their discoveries into products. Inovia will co-develop and co-manage the fund with the Mila team, and a separate legal entity will be set up to deliver it.
In an interview with BetaKit on Wednesday ahead of the announcement, Mila president and CEO Valérie Pisano said the fund initiative is a direct response to the federal priorities laid out by Prime Minister Mark Carney and AI and Digital Innovation Minister Evan Solomon—namely, to speed up Canada’s commercial efforts in AI.
“We’ve been very much inspired by the tone that Prime Minister Carney and Minister Solomon have set,” Pisano said.
Part of the new fund’s goal, Solomon said at Mila on Wednesday, is to ensure that the economic value of Canadian research discoveries remain in Canada.
“Canadian talent, Québec talent, gets harvested by other countries,” Solomon said. “We plant the seed, we water, we grow, and someone else harvests? It’s not going to happen anymore.”
Solomon called the new fund a “concierge service” that hopes to arm researchers considering a commercial venture with capital and support to turn ideas into a startup. The fund will also run venture lab-style programs to harness promising research talent across three of Canada’s national AI institutes—Mila, the Alberta Machine Intelligence Institute (Amii) in Edmonton, and the Vector Institute in Toronto—and associated universities.
“Amii is proud to continue this work, leveraging our expertise in reinforcement learning and [machine learning] to help startups accelerate their AI adoption,” Amor Provins, product owner of startups at Amii, said in a statement to BetaKit.
“This is where we have diamonds,” Pisano said. “Amii, Vector, and Mila have created ecosystems [toward which] some of the world’s greatest AI talent gravitates.”
Image courtesy Mila.
The new fund began formally fundraising on Wednesday, but Pisano told BetaKit that she expects to reach its target amount “fairly quickly,” given the “high degree of interest” within the Canadian ecosystem.
Inovia will be a limited partner (LP) in the fund through its Discovery Program for first-time fund managers, according to Chris Arsenault, co-founder and partner at Inovia. He expects the rest of the capital to come from institutional investors, family offices, and potentially, corporate Canada, which has traditionally been less active in VC.
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Arsenault said the fund will back Canadian talent—or talent from researchers studying in Canada—that will grow into global companies. “We want to create that pipeline, and nobody’s done it yet,” he told BetaKit. Arsenault added that the deal flow will provide investment and follow-on opportunities for the rest of Inovia’s funds, which are active all the way to the growth stage.
Stéphane Marceau, Mila’s managing director of AI ventures, will manage the fund with assistance and advising from entrepreneur-in-residence Alex Shee, former Pender Ventures partner Isaac Souweine, and former Circle K Ventures managing partner Jonathan Shaanan. More details on specific roles and team members will be announced, Pisano said. Marc Ghobriel, executive director of capital and strategic partnerships at Inovia, is the lead from Inovia’s side who will help structure the Venture Scientist initiative.
“Amii, Vector, and Mila have created ecosystems [toward which] some of the world’s greatest AI talent gravitates.”
This marks Mila’s first official foray into venture capital, as it seeks to better commercialize the cutting-edge AI research the institute is known for. On Monday, Mila and consulting firm Bain & Company released a report titled The Rise of the Canadian Venture Scientist, arguing that Canada can secure the AI advantage it has squandered so far by tapping into its vast network of promising researchers and helping them create companies.
“Venture scientists are researchers equipped to translate frontier ideas into companies,” the report reads, “In short, they bridge the lab, the startup, and the corporation.”
Funding these “venture scientists” is how Mila hopes this initiative sets itself apart from typical VC funds. The initiative also comes as Mila’s new scientific director, researcher Hugo Larochelle, has put an emphasis on supporting both high-quality research and the creation of new startups.
The federal government won’t directly invest into the new fund, Solomon said, though it does provide funding to Mila, Amii, and Vector.
The government has solicited feedback from both academics and industry experts on AI to inform its forthcoming AI strategy, which was initially expected by the end of 2025. Solomon told BetaKit his office aims to release the strategy this quarter, but that it would come at the “right moment” and depend on the Prime Minister’s office.
With files from Jesse Cole.
Feature image courtesy Madison McLauchlan for BetaKit.