Government names five fund-of-funds receiving portion of $350 million through VCCI

Navdeep Bains

The Canadian government has announced the first round of funds that would receive funding through the Venture Capital Catalyst Initiative.

Announced in Budget 2017, the government earmarked $400 million over three years to the VCCI program, which is meant to inject more capital into the ecosystem by leveraging private sector funds. Canadian funds were asked to apply for a portion of the funding, which is being seperated into two streams.

Through the program, the government hopes to inject around $1.5 billion into Canada’s VC ecosystem.

Stream 1, the funding being announced today, will allocate $350 million to large funds-of-funds to increase the availability of late-stage capital. Applications were assessed based on how they would address underserved sectors and Canadian regions, and strategies for increasing gender diversity within the VC industry and entrepreneurs in their portfolios.

Stream 2 will allocate $50 million for alternative investment models that can provide a financial return to investors, including matching funds, deal-based fundraising models, and micro-funds.

“Across Canada, you can find small and medium-sized firms with innovative new products and services,” said Navdeep Bains, Minister of Innovation, Science and Economic Development. “These companies often need an injection of capital to scale up and make their mark on global markets. This announcement under the Venture Capital Catalyst Initiative, part of the Innovation and Skills Plan, furthers the Government of Canada’s work to create an investment environment where made-in-Canada breakthroughs can challenge the status quo and change the world. I look forward to all the future benefits and new jobs resulting from this announcement.”

Through the program, the government hopes to inject around $1.5 billion into Canada’s VC ecosystem. The funding is being allocated through the BDC.

“As Minister of Small Business and Tourism, I’ve heard from entrepreneurs across Canada about the importance of finding the investment needed to fuel growth and take advantage of new opportunities,” said Bardish Chagger, Minister of Small Business and Tourism. “Today’s announcement of the first stream of recipients under the Venture Capital Catalyst Initiative makes it more likely that emerging businesses with fresh new ideas will find the capital and investment partners they need to scale up and create good middle-class jobs. This important initiative will help increase gender equality in the venture capital industry and support not only women-led investment funds but also women-led companies as they grow and compete.”

The five fund-of-funds receiving a portion of the $350 million include:

  • Hamilton Lane (Pennsylvania)
  • HarbourVest Partners (Boston)
  • Kensington Capital Partners (Toronto)
  • Northleaf Capital Partners (Toronto)
  • Teralys Capital
  • Photo via Flickr.

    Jessica Galang

    Jessica Galang

    Jessica Galang is BetaKit's News Editor. Follow her on Twitter @jessicagalangg or send her pitches to jessica.galang@betakit.com.