Canadian Venture Capital (VC) 102

The dynamics of the Canadian venture capital market consist of three integral parts.

Part I. Where the VC money went (VC money destinations)

The obvious parts of the three is where did the money go to.

Accurate information will provide en-users with information on VC money flow – to which province, to what sector, to what stage, to what size of companies. The information is essential in understanding the Canadian market and appropriate policy to stimulate company growth and job creation.

It seems to be so easy that anyone could tally up all the unverified information and publish it in any fancy formats.

The difficult part is that for the information to be useful, it must be objective, accurate (as of the timing of the investments, VC vs PE), complete, and verifiable.

Part II. Where the VC money came from (VC funding sources)

Canadian VC market disproportionately relies on US and international investors; to understand Canadian VC market, it is of paramount importance to know the role of US and international investors in Canadian VC market.

As keen industry observers, participants, or policy makers, you would want to know what portion of the VC disbursements was funded by Canadian investors, by US investors, and by international investors. Such information is a requisite in understanding or formulating policy responding to changing funding environment.

Part III. How much the Canadian VC firm raised (dry-powders)

When Canadian VC firms make investments in both Canadian and US/international firms, their so called dry-powders get depleted.

How much did VC firms raise each quarter, or each year, provides information on the pace of the depleted dry-powders get replenished.

Completeness Essential

There will be no understanding of the Canadian VC markets if any of the three part of information is missing. It would be like a blind person trying to figure out where he/she is going, even a cliff maybe just ahead.

DISCLAIMER:

Private Capital Journal is part of CPE News, which along with CPE Analytics, form divisions of CPE Media & Data Company. CPE Analytics has vested interest in completeness of Canadian VC data and information.

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