Power Corp has revealed that Power-backed Portage Ventures has secured more capital to execute its proven FinTech investment strategy.
Portage Ventures III, Portage Ventures’ third FinTech-focused fund, raised an additional close in the second quarter and a subsequent $145 million USD commitment in July, bringing its total to $358 million USD. Power Corp disclosed the news in its Q2 2021 earnings report, released August 9.
The new capital more than doubles the size of Portage III, Portage’s third FinTech-focused fund.
The new capital more than doubles the size of Portage III. Portage, the FinTech-focused venture investment arm of Sagard Holdings, is one of Canada’s most active and successful FinTech investors. Portage’s third fund represents part of a multi-pronged approach by Sagard and its ownership group, Power Corp, to invest in promising FinTech companies.
Toronto-based Portage invests in companies from early-stage, to growth-stage and beyond. The firm’s venture business includes its ecosystem partner, venture builder Diagram Ventures, which is also managed by Sagard, Power Corp’s alternative investment arm. Portage currently has over 40 portfolio companies across eight countries, with a total of $2.9 billion in assets under management.
Portage previously closed $427 million CAD for its second fund in 2019, giving it the largest FinTech-focused venture capital fund ever raised in Canada. The organization’s current investment portfolio includes major Canadian FinTech startups like Borrowell, Koho, and Wealthsimple, while Portage’s list of exits includes Clearco, Wave, and Zensurance.
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To date, through Fund III, Portage has invested in French insurtech startup Acheel, San Francisco-based personal finance platform Kikoff, and Montréal digital mortgage startup Nesto’s $76 million CAD Series B round in June.
Portage’s Fund III news follows Sagard’s recent launch of a new FinTech special purpose acquisition company (SPAC) on the Nasdaq, another piece of Sagard’s FinTech investment strategy. Portage FinTech Acquisition completed its initial public offering on the Nasdaq in July, securing $240 million USD after boosting its initial $200 million target.
Portage Fintech Acquisition aims to pursue one or more acquisitions in FinTech verticals like wealth and asset management, consumer and small to medium-sized enterprise finance, insurance, payments, information services, and FinTech infrastructure.
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The Portage funds and SPAC are two components of Power’s broader FinTech investment strategy, which involves investing in FinTech companies with potential for global impact and supporting the creation of the next-generation of Canadian FinTech startups. Portage initially invested in Wealthsimple in 2015 through its first fund.
Power Corp has since realized significant gains from its Wealthsimple investment. Earlier this year, Power Corp and its subsidiaries, IGM Financial and Great-West Lifeco (collectively, the PCC Group), received proceeds of $500 million CAD from a secondary offering as part of Wealthsimple’s latest round, ane retained a $2.1 billion CAD interest in the Toronto-based FinTech startup.
This represents a total increase in value of $2.3 billion over the group’s invested capital of $315 million in Wealthsimple, representing an 8.3 times increase and a compound annual return on investment of 79 percent.
Feature image from Portage Ventures
