Welcome to BetaKit’s startup stories of the week! Here, you will find the week’s most important news, features, and editorials published on BetaKit.
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TOP STORIES OF THE WEEK
Every day, it seems like tech is touting a new way artificial intelligence could solve complex issues. The Conference Board of Canada released a report this week that asserts generative AI could be the answer to the country’s long standing productivity problem.
Low economic productivity is the bane of growth and innovation. Companies are less likely to invest in R&D and upskill their workers, making Canada less desirable to foreign direct investment. Finance Minister Chrystia Freeland has called productivity and innovation “the Achilles’ heel of the Canadian economy.”
The Ottawa think tank crunched some numbers and found that generative AI could add nearly two percent to the national GDP. Taking into consideration AI’s potential to create net new products and services, that figure could be larger. Canada also has the fastest-growing pool of AI talent and ranks fourth globally in the number of generative AI companies per capita, the report stated.
Getting organizations to embrace AI for the sake of productivity sounds like a simple solution, but numerous questions crop up, particularly when factoring in the human equation of Canada’s workforce. I’ll be digging into these questions in future stories on BetaKit, but I want to know what you think. Send me your AI and productivity thoughts and it might inform our future reporting.
Thanks for reading on and catch you next week,
Bianca Bharti
Newsletter Editor
BEKH, Volta and Tribe launch new initiatives for Canadian Black founders
Tribe Network has partnered with Atlantic Canada accelerator Volta to launch a new residency program for Black founders, while the Black Entrepreneurship Knowledge Hub (BEKH) is developing a new ecosystem mapping tool for Black entrepreneurs.
The new joint program between Tribe and Volta, called Accelerate Black Tech, will combine Volta’s startup mentorship model with Tribe’s network to support Black tech entrepreneurs and their startups.
Future of Toronto accelerator uncertain as Techstars makes changes
Techstars plans to shut down some of its accelerators and move its corporate headquarters from Boulder, Colorado to New York City as part of a renewed focus on some of the world’s largest tech ecosystems, according to a statement from Techstars CEO Maëlle Gavet. Gavet added that Techstars will keep running programs in 30 other locations in addition to its core cities in 2024 but did not disclose which locations would be impacted or its plans beyond this year.
Long-serving Techstars Toronto managing director Sunil Sharma confirmed to BetaKit that the accelerator is not accepting new applications at this time and he is transitioning away.
BC tech companies stand out in 2024 TSX Venture 50 list
The Venture 50 list ranks companies based on performance on the exchange for the past year across five sectors: technology; cleantech and life sciences; diversified industries; mining; and energy. The rankings are based on three key metrics: market capitalization growth, share price appreciation, and trading value.
BC and Ontario companies also dominated the TSXV’s cleantech and life sciences list, though Alberta-based Westbridge Renewable Energy claimed the top spot with a share price increase of 95 percent during the year.
Golden Ventures closes nearly $140 million CAD for fifth seed-stage VC fund
The sector-agnostic VC firm plans to make 30 core investments in startups across Canada and the United States through Fund V, which it will begin investing out of later this year. Golden will focus on leading or co-leading rounds across the seed spectrum, companies in Toronto, Kitchener-Waterloo, Montréal, and Vancouver, with initial cheques of $500,000 to $3 million.
Golden initially began fundraising for its fifth fund last September before holding a final close in December following strong support from existing investors—tidy work amid a particularly tough fundraising environment for tech and VC.
Canadian late-stage VC funding continued to slip in 2023
For the second consecutive year, venture capital investment in Canada fell as investors remained cautious, according to new data from the Canadian Venture Capital and Private Equity Association.
The CVCA tracked $6.9 billion invested across 660 deals during the year. Investment fell by 34 percent compared to 2022, whereas deal volume remained relatively flat year-over-year, declining by six percent.
Round13 Digital Asset Fund claims over 40 percent gains despite tough crypto market
The Toronto crypto venture capital fund was announced back in April 2022 to back blockchain and Web3 infrastructure startups during the early days of what later became known as the crypto winter—a prolonged sector-wide bear market that saw numerous firms collapse, digital asset prices nosedive, and trillions in value erased.
To date, Round13 DAF has raised about $80 million USD in total—$10 million more than it launched with and less than its initial target of $100 million. The fund has deployed approximately 85 percent of that amount into an undisclosed mix of digital assets and 20 early-stage startups, including Wombo, Improbable, Confirm, and ChainSafe.
Visa Canada, Plug and Play host Toronto FinTech Innovation Showcase to spotlight Canadian startup ecosystem
Earlier this month in Toronto, leaders from across Canada’s financial sector convened at the Plug and Play Toronto FinTech Innovation Showcase to highlight the tech set to transform Canada’s financial services ecosystem.
The event looked to explore opportunities for collaboration among members of the Canadian financial services community, to spotlight leading companies, and to discuss how Canada can accelerate the momentum of its FinTech sector.
Why this Canadian VC strongly recommends SR&ED financing to his portfolio companies
In a funding landscape growing increasingly challenging for tech startups, the quest for capital has led many to explore alternatives to traditional equity investment, such as government tax incentives and grants.
While it’s a common belief that chasing this type of funding can be a time-intensive distraction for founders, Jason Robertson, co-founder and partner of Nimbus Synergies, an early-stage, healthtech-focused venture capital (VC) firm headquartered in Vancouver, has a different perspective.
Funding, Acquisitions, and Layoffs
VAN – Levr.ai – $1M CAD
TOR – Helika – $10.8M CAD
TOR – Golden Ventures closes $140M CAD fund
TOR – Armilla AI – $6M CAD
TOR – 1Password acquires Kolide
MTL – Zūm Rails – $10.5M CAD
THE BETAKIT PODCAST
After Ecobee, Stuart Lombard has no regrets. After a 16-year run leading Ecobee, Stuart Lombard has stepped down as CEO and president of the smart thermostat maker. He joins the BetaKit Podcast to discuss lessons learned, building consumer hardware in Canada, and “becoming the smart home company Nest should have been.”
“There’s a big difference between wanting to be great and being great.”
Feature image courtesy East Riding Archives on Unsplash.
