Canadian VCs are all aflutter about the announcement last week by the federal government that it would no longer continue support of the Venture Capital Catalyst Initiative (VCCI).
Wait, that’s not right. In fact, Minister Mary Ng announced last week not the end of VCCI, but a call for proposals for the $450 million committed to VCCI in Budget 2021, including $350 million in fund of funds commitments.
The announcement actually came from Canadian Venture Capital and Private Equity Association (CVCA) CEO Kim Furlong, in an interview with The Globe and Mail.
“I have to note the huge sigh that was just expressed through Tony’s entire being.”
In that interview, Furlong declared… Well, she didn’t exactly say VCCI was over after its second iteration, only that she thinks “this is the last time we’ll see a major fund-to-fund initiative from the federal government.” Per the Globe, Furlong did note that she is committed to “not go back and ask for another general fund.”
So why is the head of Canada’s venture capital interest group announcing — on the same day as Minister Ng’s announcement, and a week prior to the CVCA’s annual investor event — that she will no longer advocate for a program that she once said Canada’s innovation sector would be “severely weakened” without?
Great question! Let’s ask the guy who wrote a multi-part series earlier this year noting just how dependent the Canadian VC ecosystem was on government funding support.
RBCx’s Anthony Mouchantaf – known to regular listeners as TONY DAGGER – returns to the BetaKit Podcast to answer listener submitted questions, including how Canadian startups can fend off the current tech bubble bursting and if wearables are cool again (spoiler: no, they are not).
But back to that VCCI question. For his part, Mouchantaf thinks that Furlong’s statements are more a reflection of what she has been told by the feds than what the CVCA actually wants. Which is interesting, because if you talk to certain employees of BDC (the entity that administers VCCI), they might tell you they think the program isn’t dead at all. Given that governments aren’t often in the business of announcing when they won’t commit funding, only time will tell.
True or not, all of the above context is just a lot of throat-clearing for the important question: what impact would the loss of VCCI have on Canadian tech and venture? For that question, we are grateful to have Tony Dagger help us poke at the answer.
Let’s dig in.
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