Osney Capital has closed more than 50 million pounds ($92 million CAD) for its first venture capital (VC) fund to back early-stage cybersecurity technology startups across the United Kingdom (UK) and Canada.
Amid trade-war-fuelled uncertainty and shifting international alliances, UK-domiciled Osney sees an opportunity to help seed-stage UK cybersecurity companies enter Canada and North America, and bring Canadian cybersecurity startups to the UK and Europe. Osney is opening an office in Calgary, staffed by partner Adam Cragg, to support these plans.
“There’s a long-standing, trusting relationship between the UK and Canada.”
Adam Cragg,
Osney Capital
In an interview with BetaKit, Cragg cited “the soft power that Canada commands” and said the country’s activities in artificial intelligence (AI), quantum computing, and data centres make it an attractive place for Osney to establish operations.
“In a field like cybersecurity that’s very driven by trust, there’s a long-standing, trusting relationship between the UK and Canada,” Cragg said.
For UK and European startups looking to expand into the North American market, Cragg said Canada has become “an increasingly attractive option” with close proximity to the United States (US), whereas for Canadian startups looking to grow overseas, he argued that “The UK is a great destination.”
Cragg, former executive director of Innovate Calgary and founding partner of Quake Capital Partners, founded Osney alongside fellow partners Josh Walter and Paul Wilkes, who are both based in the UK and have experience in areas like cybersecurity, investing, and law. Osney is accredited by the UK’s National Security Investment Fund, and has a network of advisors and potential partners from across the cybersecurity space.
The cornerstone limited partner (LP) of Osney’s first fund is the British Business Bank. Other LPs include US-based defence-focused IronGate Capital Advisors, London’s East X Ventures, a number of exited cybersecurity founders, and undisclosed Canadian family offices.
Osney ultimately surpassed its 50-million-pound target, raising a sizable fund despite a challenging VC fundraising market, especially for first-time managers.
“I think we’re at a tipping point for the realization around cybersecurity that this is a whole suite of technologies that are central to protecting our way of life and our economic systems and democratic systems,” Cragg said.
Crunchbase data indicates that big rounds drove a cybersecurity VC funding comeback in 2024 but deal count was ultimately down 22 percent year-over-year.
For its part, Osney claims that it is the only VC firm dedicated exclusively to seed-stage cybersecurity in both the UK and Canada.
“There’s this unclaimed space around specialized cybersecurity capital in Canada that we’re really excited by going forward,” Cragg said.
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To date, Osney has amassed a portfolio of six UK startups outside of its first fund to validate its thesis, making angel investments into a group that includes Sheffield’s Sitehop, Bristol-based Onsecurity, Manchester’s Esprofiler, and London-based Mindgard, RevEng, and Seedata.
Through its debut fund, Osney plans to build a portfolio of 30 companies by investing at the pre-seed and seed stages. The firm intends to write first cheques of between 250,000 and 2.5 million pounds, with the capacity for follow-on investments in Series A rounds.
According to Cragg, Osney plans to invest largely across the UK and Canada, with opportunistic investments elsewhere. He said the VC firm has yet to determine exactly how much it plans to deploy in Canadian startups, but confirmed that it intends to invest a portion of the fund’s capital in Canada-based cybersecurity companies looking to move into the UK, and expand its team in Canada over the next couple of years.
Cragg is also particularly bullish on Canada’s AI, quantum computing, and data centre sectors, and said these will create a need for more innovative cybersecurity startups.
Feature image courtesy Osney Capital.