Why aren’t Canadian VCs more “cutthroat?”

Plus: An exclusive interview with ex-Lightspeed CEO JP Chauvet on his next move.

On Tuesday, I moderated a Council of Canadian Innovators panel with Allen Lau, founder of Wattpad, Advise2Rise CEO Susy Martins, and other major ecosystem players about the issues facing Canada’s innovation economy. One of the sticking points? Canadian VCs need to toughen up. 

“We have to be more cutthroat,” Lau said. “When you talk to US investors, the first question they ask you is how big the return is before they look at the risk. Then, for Canadian investors, typically it’s ‘Oh, this is too risky.’ They don’t even think about the return.”

Our neighbours down south have always outperformed Canada in deal volume and activity, which makes sense given Silicon Valley’s gravity and a population roughly 10 times our own. But the numbers back up Lau’s claims that we’re not performing to our potential. 

Analyzing data from the CVCA and PitchBook, the US deployed $170.5 billion to startups in 2023, while Canada invested $7.1 billion. In 2023, there were 13,608 US VC deals (a 23-percent drop from 2022), with 650 deals in Canada (a 13-percent drop from 2022). The US had a steeper decline, but Canadian VCs would need to double their deal totals to match US VCs on a per capita basis. Relative to the US, Canadian venture is a rounding error.

The disparity is also apparent in corporate venture capital: only six percent of Canada’s largest companies participated in a deal last year, compared to 40 percent in the US. Those Canadian firms that did invest mostly did so in American and foreign startups. 

The Americans sink their teeth into risk, which is one of the reasons why Canadian productivity hasn’t been able to keep up, Lau said (Canada’s economy is 30 percent less productive per capita than the US). It’s likely contributing to why we have 100,000 fewer entrepreneurs than two decades ago.

What do you think it would take to get Canadian VCs to choose return over risk? Is it as simple as convincing pension funds to make more Canadian investments? My inbox is open.

Thanks for reading on and ’til next week,

Bianca Bharti

Newsletter Editor


MaRS makes layoffs as part of business model “resetting”

MaRS Discovery District has made reductions to its staff as the Toronto innovation looks to get back to its “original vision,” BetaKit has learned.

Multiple sources indicated that the hub made a staff reduction Monday. Alison Nankivell, CEO of MaRS, confirmed the layoffs with BetaKit, stating the hub is examining how its spaces, programs, and community can “propel Canadian innovation in a shifting global context.”

Sources who spoke with BetaKit under condition of anonymity indicated that at least 20 roles were cut.

(Read more)

Former Lightspeed leader JP Chauvet aims to be “good sounding board” as Inovia’s newest EiR

During his more than 11 years at the commerce technology company, Chauvet played a key role in scaling Montréal-based Lightspeed into a global, publicly traded player. He joins Inovia months after stepping down as Lightspeed CEO, following two years at the helm attempting to guide the fast-growing firm to profitability amid a challenging tech market.

In an exclusive interview with BetaKit—his first since being replaced as CEO by his predecessor, Lightspeed founder Dax Dasilva—Chauvet said he wanted to take some time off from operations to rest, reset, and consider his next move. Inovia offered a “natural fit” and a chance to share his knowledge with other Canadian tech firms.

(Read more)

Dapper Labs reaches tentative settlement in NBA Top Shot class-action suit

Dapper Labs’ class action lawsuit might be nearing its end, as the Vancouver-based blockchain startup has agreed to a $4-million USD settlement with plaintiffs this week.

The lawsuit began in 2021 when a group of investors who bought Dapper Labs’ Moments, which are non-fungible tokens and part of the company’s NBA Top Shot platform, claimed that Moments constitute unregistered securities. The suit, filed in the Southern District of New York, alleged that Dapper Labs violated United States securities law by selling Moments to fans without registering them with regulators.

(Read more)

Federal, BC privacy watchdogs investigating Certn

The federal and British Columbia privacy commissioners have launched a joint investigation into Victoria-based background-check technology startup Certn.

Both agencies are looking into Certn’s use of personal data and compliance with Canadian and BC privacy legislation, particularly as it relates to the startup’s tenant-screening services.

(Read more)

Tiny appoints WeCommerce head Jordan Taub as its new CEO

Victoria, BC-based holding company Tiny has appointed Jordan Taub, the head of its e-commerce software platform WeCommerce, as its newest CEO.

Tiny says co-founders Andrew Wilkinson and Chris Sparling, who were acting as the firm’s co-CEOs, will “remain actively involved” as chairman and vice-chair, respectively, and work closely with Taub on capital allocation and operational execution.

In an X post, Wilkinson likened himself to an aging athlete letting a new star player take the reins.

(Read more)

Feds resume SDTC funding under NRC following damning AG report

The federal government has resumed funding for Sustainable Development Technology Canada as it prepares to bring the embattled cleantech agency under the National Research Council of Canada in the coming months.

The restoration of funding is being announced amid today’s release of a damning report by Canada’s Auditor General Karen Hogan, which found “significant lapses” in SDTC’s governance and management of public money. The federal government has also appointed new positions to lead the agency through the upcoming transition.

(Read more)

Funding, Acquisitions, and Layoffs

VAN – Apollo – $18.5M CAD
KWL – IntelliCulture – $3.5M CAD
TOR – Mesosil – $2.2M CAD
TOR – McRock Capital closes initial $111M CAD for new fund
TOR – Acorn Biolabs – $11M CAD
OTT – Shopify acquired Checkout Blocks
MTL – Scale AI invests $31.3M across 22 projects
MTL – Valsoft acquired Progitek 
VIC – Vosker – $171.2M CAD debt financing
MIA – Staging Labs acquired by Merkle Science

The BetaKit Podcast

How Dax Dasilva plans to get Lightspeed to $1 billion in revenue

“Fiscal ’25 is the year we turn 20, and it’s the year we cross a billion in revenue and we become a profitability story.”

Once again back in the CEO chair, Lightspeed’s Dax Dasilva discusses why he stepped down, then returned, as the company he founded approaches its 20th birthday.

B|K: The BetaKit Newsletter is powered by Intuit.

Engineering solutions to real world problems

Join us for “AI in Action: Transforming the Real World,” hosted by BetaKit and Intuit Canada. Held during the week of Collision, this is a chance to hear from some of the top minds in Canadian tech as they discuss the groundbreaking work and real world engineering challenges being tackled with AI.

Featuring Dr. Anna Goldenberg, AI in Medicine for Kids, SickKids Research Institute, Salim Teja, Partner at Radical Ventures (Cohere, Waabi, Xanadu), and Greg Coulombe, Engineering Director at Intuit, as they share their insights with BetaKit CEO Siri Agrell.

Register now to be a part of the conversation.

Bianca Bharti

Bianca Bharti

Bianca Bharti is the newsletter editor at BetaKit, where she spearheads coverage and analysis of tech news in related products. Before BetaKit, Bianca covered the nexus of markets, industries and policy in a variety of formats as a reporter for the Financial Post. There, she won silver in SABEW's 2021 Best in Business Journalism Awards in the personal finance category for one of her pieces. In her free time, she enjoys swapping her reporter hat for a baseball cap to hit up some hiking trails with her dog. She also weirdly loves debating monetary policy.

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