What does it actually take to raise capital in 2025?
For Canadian founders, understanding the volume of investment is only part of the equation. Navigating today’s market requires a deeper grasp of how deals are being structured, who’s deploying capital, and the evolving dynamics shaping investor behaviour behind the scenes.
Following the release of Osler’s 2024 Deal Points Report: Venture Capital Financings, BetaKit spoke to two partners at the firm, Gary Marshall and Laura Webb, who work directly with founders and investors across the country.
Their front-line insight offers a candid look at the forces shaping the current market.
The edge is becoming the core
In 2024, Canada’s venture market was still led by a handful of large-scale financings, including rounds raised by Cohere and Clio. “Larger deals are really driving the Canadian ecosystem in terms of dollars invested,” added Marshall.
“You need to think about what’s going to differentiate you relative to the billion other companies that didn’t raise in the past two years.”
Gary Marshall, Osler
While those mega-deals propped up total investment figures in 2024, they didn’t tell the whole story.
Founders at earlier stages are starting to see more movement again, suggesting investor appetite is slowly returning for riskier, earlier bets.
“Another big trend we see, relative to the post-COVID boom era, is that early stage seems to be making somewhat of a comeback,” Marshall added.
According to the report, the biggest increase in these early-stage financings was at the seed stage, where the number of financings increased 18 percent from 2023 and represented 45 percent of all financings in 2024.
At the same time, activity is expanding geographically. The Prairies, for example, accounted for roughly 14 percent of deals and five percent of invested capital last year.
“Historically, [venture] was very focused in the larger cities,” Marshall added. “Now we’re seeing a lot more activity in the Prairies and the Atlantic provinces.”
Diligence is deepening
Investor hesitancy prolonged deals and led to much deeper diligence processes in 2024. Webb believes this means that founders in 2025 must be ready to demonstrate traction over time, not just in a pitch.
“The diligence process from the investor side really drives a lot of the timeline,” Webb added. Investors are more scrupulous about the commercial realities, financial metrics, and understanding whether startups can hit their metrics.
That growing investor hesitancy, Marshall noted, is also being shaped by broader market volatility, especially in a climate where conditions can shift “day to day or week to week.”
In 2025, this uncertainty has been amplified by Canada’s ongoing trade tensions with the United States, leaving many businesses and investors navigating a persistent sense of unpredictability.
Time to get real
With longer fundraising timelines, founders can no longer count on money being available on demand. Success, according to Marshall, depends on careful planning, ongoing investor relationships, and realistic expectations around valuation.
“Anticipate the comments, the questions, the concerns that your investors are going to have, and have solutions in mind.”
Laura Webb, Osler
“You really have to kind of think hard 12 months out, because that’s how long it’s taking a lot of these rounds to come together,” Marshall said. “Who’s going to fund us? Is it going to be strategics? Is it going to be our existing investors? Is it going to be new venture funds?”
Existing investors have become a key factor in those decisions. “In almost all the deals we’re seeing, there’s meaningful insider investment, if not insiders leading the round,” Marshall added.
That dynamic is opening up more strategic conversations. “I think that’s something that’s important to keep in mind, is keeping your existing investors happy,” he said.
“That’s an advantage, because you can actually get to have the conversation with them and say, ‘Okay, we need to raise 12 months from now. What do I need to do in order for you to want to lead around at that time?’” he added. “Whereas, if it’s a new outside lead like you’re not going to give you that magic answer.”
Founders must stay focused
Webb believes the longer fundraising timelines also comes down to a reduced willingness from investors to deploy capital.
“There was less competitive tension,” Webb said. “There’s a lot of wait and see happening out there, and we saw that in 2024.”
Teams that navigated this environment well, she said, remained patient with those longer timelines and managed what she called “deal fatigue.”
“The other piece is keeping focused on the business,” she said, noting that she sees many founders getting pulled away from the operation of their business in the midst of a fundraise.
“If you’re detracted and you’re distracted by doing your fundraising, then that ultimately is going to feed into whether or not you’re getting investment at the end of the day.”
Get the house in order
To succeed in 2025, Webb and Marshall agreed that founders need discipline, clear plans, and patience for slower timelines.
“Have your data room ready,” Webb said. “Anticipate the comments, the questions, the concerns that your investors are going to have, and have solutions in mind. Really get your corporate house in order early on.”
Founders should also “expect delays,” Webb added. “I think we’re still seeing slow timelines to closing in the first half.” She said it’s important for founders to track their capital spend closely, and if possible, seek other sources of financing, like debt or non-dilutive funding.
Founders heading to market in 2025 are entering a crowded field, which means the pressure is on for startups to stand out.
“There’s a big backlog of companies that need to raise,” Marshall said. “And if you’re going out in that cohort, you need to think about what’s going to differentiate you relative to the billion other companies that didn’t raise in the past two years.”
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The 2024 Deal Points Report offers one of the most comprehensive views available into how Canadian financings are really getting done.
For a deeper look at the data behind these dynamics, read Osler’s full 2024 report now.