BDC outlines how it will deploy $1 billion from its Defence Platform into funds and startups 

By September 15, 2026
A BDC sign.
Crown corporation increased direct defence investment capacity and pledged more to defence-focused fund-of-funds. 

As part of the Canada Investment Summit on Tuesday, the Business Development Bank of Canada (BDC) outlined how it will invest $1 billion of its broader $6 billion Defence Platform into defence tech startups and funds. 

The news: BDC has earmarked a $500-million Defence Fund to invest in Canadian and allied-nation venture capital, growth equity, and private equity funds focused on defence and dual-use technologies.

In addition, BDC has increased its direct investment vehicle, the StrongNorth Fund, from $300 million to $500 million. BDC said the $200-million increase will allow the fund to continue meeting demand from Canadian defence and dual-use companies

From the source: Peter Dawe, BDC’s VP of defence strategy and a recently retired Major General, told BetaKit in March that the Defence Platform will make both pure military and dual-use investments. 

Dawe said those investments must align with Canada’s Defence Industrial Strategy (DIS), and the key sovereign capabilities it outlines. These include aerospace, ammunition, digital systems, in-service support, personnel protection, sensors, space, specialized manufacturing, training and simulation, and autonomous systems.

The context: BDC launched its $4-billion defence platform last December, after the federal government made a major $82-billion financial commitment to defence spending in the 2025 budget. This past March, BDC expanded the platform to $6 billion so it could provide more loans and investments to the sector.

BDC’s Defence Fund will invest in funds focusing on Canada’s defence and sovereignty priorities, and it made its first investment in Intrepid Growth Partners‘ inaugural $525-million USD ($731-million CAD) fund. 

Meanwhile, the deep tech-focused, stage-agnostic StrongNorth Fund, led by Peter Suma, is the successor to BDC’s prior Deep Tech Venture Fund. Its focus includes AI, autonomy, space, intelligence, surveillance and reconnaissance, advanced materials, and energy.

Final thought: While details of BDC’s capital allocation to defence tech investment mark progress, it does not equate to deployed capital. BetaKit has spoken with VCs who have noted that the large defence investments seen in the first half of the year, such as Dominion Dynamics’ seed and Series A rounds, have mostly dried up as the venture industry waits for BDC to start cutting cheques.

With files from Douglas Soltys. 

Feature image courtesy Madison McLauchlan for BetaKit.

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