Evergreen venture firm, Leaders Fund, has announced that Dave MacDonald, the former CEO of Softchoice, has joined as the firm’s newest venture partner.
The Softchoice CEO of more than 16 years decided to make the move into VC after retiring from the IT solutions and managed service provider in 2017. He will be focusing on helping Leaders Fund’s portfolio and potential companies to build go-to-market plans to help them scale.
“Joining Leaders Fund is a logical extension of the executive leadership work I’ve been doing with a select group of CEOs.”
After a 34-year-long career in tech, MacDonald said he is looking forward to bringing his knowledge and expertise of scaling sales and marketing to the Toronto-based Leaders Fund.
“I [will] spend time with companies working through and understanding the market, and building the go-to-market. It’s also about showing them that Leaders Fund is more than a source of capital, it’s a source of expertise and mentoring as they grow their businesses,” MacDonald said.
Prior to joining the VC firm, MacDonald has served and continues to serve on a number of boards, including computer software company Densify, Waterloo-based InTheChat Communications, as well as Softchoice. He previously served as board director for Turnstyle Analytics, which was successfully acquired by Yelp in 2017. MacDonald told BetaKit he has also worked with a number of these smaller companies, including Tulip Retail and helped to coach some of their CEOs. He called his move to VC a natural step to help on a broader scale.
“Joining Leaders Fund is a logical extension of the executive leadership work I’ve been doing with a select group of CEOs,” said MacDonald. “The operating background of the firm, the strength of their portfolio, and their unwavering commitment to use their experiences to help entrepreneurs build storied companies aligns well with my values and focus.”
“There’s no shortage of venture capital funding these days. Now it’s about how to do we help these companies scale.”
MacDonald also noted that what he brings to the table is something Canadian companies specifically, need, which is to grow from startup to scale-up. “There’s no shortage of venture capital funding these days,” he said. “Now it’s about how to do we help these companies scale. That is the next major milestone for Canadian tech companies, scaling sales and marketing.
“It is very rare to find an entrepreneur, operator and CEO who has grown a technology company to over $2 billion in annual revenues and 1800 employees,” said David Stein, co-founder and managing partner of Leaders Fund. “We have built our firm on the belief that as former operators, we can provide experience-based, actionable advice to our portfolio companies to help them grow faster. Dave furthers this strategy, bringing a rich set of experiences, frameworks, and connections that entrepreneurs will appreciate.”
Leaders Fund was launched in 2016 by co-founders and managing partners Stein and Steve DeBacco, as well as former OMERS Ventures investor, Gideon Hayden. The firm runs as an evergreen capital fund, which means it has an indefinite fund life. In these types of funds, that have no end-date, LPs are able to exit or change their investment in the fund every so often and the portfolio is then valued, and carry incentive is calculated for the general partners. Evergreen funds are also typically permitted to recycle capital after an exit rather than distributing to investors.
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Leaders’ fund previously stated that it hoped this model structure would be attractive to investors as it allows the fund to partner with others on more flexible terms, at various stages, and in different roles depending on the goals of the portfolio company. The firm currently lists 14 companies in its portfolio including Ada, and Toronto-based computer software companies Top Hat and Influitive.
“Dave furthers [our] strategy, bringing a rich set of experiences, frameworks, and connections.”
MacDonald is the latest to join the fund’s small Toronto-based team, which also has a satellite office in Atlanta, Georgia. The position of venture partners was previously held by Howard Ginn who started with Leaders Fund at its launch, and has since retired. While only a venture partner, MacDonald is notably the fourth male partner joining the firm.
Founding partner, Hayden noted to BetaKit that while Leaders Fund is a small firm, it has plans to keep diversity in mind when it is expanding its team. “That’s something that’s important to us,” Hayden said, noting that people with different backgrounds and viewpoints lead to better outcomes and decisions from a businesses perspective.
Leaders Fund’s founding team comes from a generally SaaS and operational background. Hayden’s time at OMERS saw him working with SaaS portfolio companies, which included Hootsuite. Stein is the founder and CEO of Toronto-based performance management platform Rypple, which was acquired by Salesforce.com, as well as the co-founder of workforce management software Workbrain, which was acquired by Infor for $227 million USD. DeBacco also worked with Stein at Rypple and spent some time as the VP of Salesforce Work.com.
Image courtesy Leaders Fund