One of the chief complaints of local up-and-coming companies is that they lack access to B.C.-based venture capital. Without that source of funding, many organizations find it difficult to grow their business.
According to a recent report by audit and tax advisory firm KPMG, venture capital investment has been falling in British Columbia. In 2014, funding from VCs totaled $787 million. By 2017, that number had more than halved to $343 million.
A new Canada-focused venture capital firm named the Framework Venture Partners, however, aims to reverse that critical shortage.
The organization yesterday announced that it successfully raised $150 million from companies including BDC Capital, Cadillac Fairview, Royal Bank of Canada, and the BC Tech Fund, managed by Kensington Capital. As a result, it will be setting up offices in Toronto and Vancouver.
The Framework Venture Partners aims to support quick-growing Canadian technology companies that it believes have the potential to go global. It will primarily invest in business-to-business, software-as-a-service (SaaS) organizations—a specialty of the Vancouver tech scene.
The ideal candidate for its capital would be a company working with machine learning to interpret huge datasets, and offering a new product or service as a result. The firm is also looking to fund businesses offering unique, easy-to-use financial services.
Previously, most of the investment in Canada has gone into seed or early-stage companies, allowing ecosystems like Vancouver to become one of the top startup hubs in the world. The Framework Venture Partners, however, wants to reach later-stage companies to ensure that they have the means to continue to grow.
“We believe there is great opportunity for later stage investment in Canadian technology companies,” says Jérôme Nycz, executive vice president of BDC Capital. “The Canadian venture capital industry has come a long way in the past 10 years, and an important part of the strategy we launched almost a decade ago was to build and deploy new, high-performing funds into the Canadian market. We are achieving this goal with our investment in Framework and we look forward to partnering with them to pursue this opportunity and support the venture ecosystem in Canada.”
The company’s Vancouver office will be led by Andrew Lugsdin, a founding partner of the organization. His previous investments include some of the city’s fastest-growing startups, including e-commerce company Elastic Path and personal verification service Trulioo.
Kate Wilson is the Technology Editor at the Georgia Straight. Follow her on Twitter @KateWilsonSays