BC’s new $100 million venture capital fund
December 14th 2015 at 01:08 PM
On December 8, 2015, Premier Clark announced that the Province of British Columbia is creating a $100 million venture capital fund-of-funds as part of the foundation for a comprehensive technology strategy aimed at stimulating growth in this fast-moving sector, creating jobs and strengthening a diverse economy. 

See also the backgrounder menu “Highlights from the capital pillar” for more information.

Innovation Island’s own Paris Gaudet (Executive Director) was honoured to represent the BCIC Venture Acceleration Program which has been the backbone of Innovation Island’s activities for over three years.

In conjunction with the Ministry of International Trade  and pre-existing venture capital programs, this fund will help to build a more robust Provincial venture capital system by increasing the supply of local and other investors. The new BC Tech Fund is part of three economy-building pillars in the B.C. government’s multi-year #BCTECH Strategy that will drive growth and job creation in the multi-billion dollar tech sector. The timing of this announcement coincides with the upcoming #BCTECH Summit (Jan. 18-19, 2016) where the #BCTECH Strategy will be released in full. 

So, with the above formalities out of the way what does this actually mean for Startups and tech-based SMB’s in our region? 

First and foremost, especially for those raising money, new capital into the system is good news!  As you will note in the above reference links this particular fund will operate as a true venture capital entity  in addition to the Eligible Business Corporation (EBC) direct investment Tax Credit program. Almost all venture financing, in whatever form, is leveraged or matched by other sources; any new contribution, to a fund or individual Company, creates ripple effects to helping encourage more of the same.

The aim of The BC Tech Fund is to fill a gap in venture capital requirements for Companies in the later “Startup” stage and “Development” or commercialization phase(s). See the referenced infographic for more information.

Companies in the “Startup” or “Development” stages, that may fit the criteria of these types of funds, typically require funding from $1M to $10M.  In most cases this is “after” they have accomplished numerous project milestones; the minimum viable product (MVP) has been validated by customers, they are at or near revenue, the founding team (3+ people) is fully committed/established and significant market opportunities/growth can be illustrated, etc.  Typically, at this stage, the Company has also previously raised initial capital from Family & Friends and/or Angel investors, over $200K.

For some excellent background and infographics on technology growth and financing see the following links from fundersandfounders.com

The Canadian Venture Capital & Private Equity Association (CVCA) provides a helpful membership directory covering all major industry categories.The Government of Canada's Concierge Service also provides a funding directory (and other information) for small and medium-sized enterprises.

Innovation Island offers a complimentary Business Advisory Service to entrepreneurs in knowledge-based industries throughout the region. To help assist or advise on this topic please contact us and/or submit our confidential Investment Readiness form

Graham Truax, Executive in Residence / Business Advisor graham@innovationisland.ca