Northside Ventures aims to build “institutional angel investor” with $30-million USD second fund

Toronto-based Northside Ventures has officially launched its second venture capital (VC) fund geared towards Canadian technology founders at the earliest stages of company formation.

Northside aims to raise $30 million USD ($40 million CAD) for Fund II by early 2027. The firm is already more than halfway there, having secured $17 million USD ($24 million CAD) in total commitments to date across two closes, surpassing the size of its inaugural $11-million USD ($15 million CAD) fund.

“We’re taking the approach of being an institutional angel investor in the Canadian ecosystem.”

Northside founder and solo general partner (GP) Alex McIsaac revealed the news in an exclusive interview with BetaKit. While the firm’s overall strategy remains largely to continue its focus on pre-seed Canadian tech startups at or near inception, Northside hopes to cut bigger cheques and invest in companies with a larger second fund.

Through Fund II, Northside intends to deploy an average of $500,000 USD into each startup’s first round of financing, which is more than twice as much as the $225,000 it deployed via Fund I. It also plans to double its reserves for follow-on investments in top-performing firms to 20 percent, and invest in a total of 40 companies (10 more than its predecessor).

Northside aims to combine the reach and support of a larger VC firm with the decision-making speed and personal approach of an angel investor. The VC firm often invests in entrepreneurs before they have built products, let alone businesses, and McIsaac said Northside has sometimes had to wait for founders to incorporate and set up their bank accounts to invest.

“We’re taking the approach of being an institutional angel investor in the Canadian ecosystem,” McIsaac said.

First-time Northside limited partner (LP) CIBC Innovation Banking and returning investor Intact Private Capital are co-anchoring Fund II; new LP TD Innovation Partners and existing San Francisco-based backer Bain Capital Ventures have also contributed, alongside undisclosed family offices, high-net-worth individuals, and Canadian tech entrepreneurs.

“At the earliest stages, investors are often backing a founder and an idea before much else exists,” CIBC executive managing director and head of innovation banking Paul McKinlay told BetaKit over email. “That kind of conviction capital is vital to a thriving innovation ecosystem, and it is the role Northside is playing. We’re proud to support a fund with a clear focus on investing at the very start of the founder journey.”

While CIBC Innovation Banking aims to support Canada’s tech and VC ecosystem across every stage, McKinlay noted that “strong later-stage companies only exist when there is a healthy early-stage market behind them,” and said the bank’s Northside LP commitment reflects its intent to support “the next wave of ambitious Canadian founders.”

McIsaac, former Canadian partner at Germany’s Global Founders Capital, launched Northside in 2023 to focus on promising Canadian tech entrepreneurs building in Canada and the US at the pre-seed level, where domestic institutional capital is often scarce. The Northside GP argued that compared to the much deeper US VC market, Canada lacks enough funds focused specifically on pre-seed startups.

“When I started Northside in 2023, that gap was there,” McIsaac said. “I think it’s still there.”

While Northside invests across a broad range of sectors, with Fund II the firm is particularly interested in AI applications, AI infrastructure, and frontier tech, including robotics and defence. At the moment, McIsaac said the latter is the fastest-growing category.

McIsaac believes some of the most important tech companies created over the next decade will be built by Canadians, and is happy to invest in founders wherever they are building. Through Fund I, Northside backed 30 companies over three years, equalling a pace he set previously with Global Founders Capital. McIsaac said the portfolio split between Canadian founders building in Canada versus the US worked out to approximately 50/50.

Since then, nine of those firms have raised priced rounds at higher valuations, and 12 have secured additional capital at larger simple agreements for future equity valuation caps. Those early results have stoked McIsaac’s confidence in Northside’s thesis. Some of Northside’s Fund I success stories include Canada Rocket Company, Datac u rve, North Vector Dynamics, Solcoa Industries, and Terminal.

While Northside has been running an analyst internship program since it launched, the firm decided last year to roll out a scout program to stay connected with its graduates. That initiative has grown from four to nine members across schools like the University of British Columbia, the University of Waterloo, the University of Toronto, and McGill University, and into an important source of deal flow for Northside.

During this time, Northside has grown its team to six. Former analyst intern Naomi Welch is joining as a full-time investment team member for the firm’s second fund. Northside also has two analysts focused on finding and researching prospective investments and two engineers responsible for building and maintaining the internal AI sourcing product that helps Northside manage its pipeline and complete more than a deal per month.

Northside has already begun picking up its investment pace with Fund II: the firm has made a dozen investments since the start of 2026, backing PolarGrid, Space, Aron AI, Solderable, Windkey, and Vernius Systems, among others.

“We’ve spent the past three years building the track record, relationships, team, and infrastructure to become an enduring institutional venture firm, without compromising the speed, conviction and personal approach that got us here,” McIsaac said. “With 12 new investments already this year, I feel more confident than ever in our ability to identify and back exceptional Canadian founders at the earliest stages.”

Feature image courtesy Northside Ventures.