VC deal volume sees slump in first half of 2020 amid COVID-19, CVCA finds

teamwork

Venture capital and private equity deal volume fell in Canada during the second quarter of this year, as the COVID-19 pandemic began to take hold in Canada, according to a new report from the Canadian Venture Capital & Private Equity Association (CVCA).

Notably, VC funding increased from $901 million in Q1 2020 to approximately $1 billion in Q2 2020.

The CVCA has released preliminary findings of its H1 2020 market review, which tracks venture capital (VC) and private equity (PE) activity in Canada over the first and second quarters of 2020. The report is based on survey data pulled from VC firms, PE firms, labour-sponsored venture capital corporation organizations, and limited partners across the country.
 

VC deal volume fell in both the first and second quarters of 2020, declining from Q4 2019’s 163 deals to 119 in Q1 2020, and 82 in Q2 2020. The findings indicate the COVID-19 pandemic and subsequent lockdown may have caused deal flow in VC to decline. Notably, however, VC funding increased from $901 million in Q1 2020 to more than $1 billion in Q2 2020.

RELATED: While venture funding stays consistent, BC startup deal count sees Q1 decline

Overall, VC funding in H1 2020 reached $1.9 billion over 201 deals. Large VC rounds over H1 2020 included Top Hat’s $72 million CAD Series D round, AbCellera’s $144 million CAD Series B round, and Ada’s $63.7 million CAD Series B round.

The first half of 2020 saw $8.8 billion in PE funding over 223 deals. PE deals totalled 151 in the first quarter, slightly up from Q4 2019’s 142. Q2 saw PE deals plummet by 52 percent to a mere 72.

PE funding, which performed exceptionally well in Q4 2019 with $12 billion in funding, dropped from $12 billion to $4 billion over Q1 2020, and dropped further to $3.9 billion in Q2 2020. Notable PE deals in H1 2020 included Semios’ $100 million CAD finance raise and ApplyBoard’s $100 million CAD raise.

The CVCA’s full report is expected to be released in late August.

Photo via Unsplash

Isabelle Kirkwood

Isabelle Kirkwood

Writer, globetrotter, drone pilot & David Attenborough enthusiast