As we emerge from the COVID-19 crisis, a priority of the Government of Canada is to put Canada's economy on a stronger footing, both for Canadians today and future generations. Innovation is the path to inclusive growth. It fosters a thriving middle class and opens the country to new economic, social and environmental possibilities. As part of Budget 2021, the Government made a historic investment to support Canadian entrepreneurs in their efforts to start up, scale up, and become the next generation of Canadian anchor companies. Specifically, new funding for the Venture Capital Catalyst Initiative (VCCI) is building on earlier investments to ensure Canadian businesses continue to enjoy access to a globally competitive venture capital ecosystem capable of nurturing entrepreneurial talent and creating high-quality, middle-class jobs. Venture capital (VC) is a specialized type of equity financing that takes educated risks on great ideas and talented people by investing capital in young, high growth-potential companies to give them the opportunity to develop their ideas into marketable products. The Canadian venture capital ecosystem has grown significantly over the past decade, with a total of $6.9 billion invested across 660 deals in 2023. Canada is ranked third for VC investment according to the Organisation for Economic Co-operation and Development (OECD). The Canadian Venture Capital and Private Equity Association (CVCA) attributes much of this growth to the Government of Canada's support for VC, including through the Venture Capital Action Plan (VCAP) and earlier investments made under the VCCI (Budget 2017).
The Call for Expression of Interest for the renewed Venture Capital Catalyst Initiative is now closed.
Selected recipient fund managers announced under each stream are listed below. Investments are managed by the Business Development Bank of Canada (BDC) on behalf of the Government of Canada.
Information on the application, submission and selection process can be found in the VCCI 2021 Call for Expressions of Interest. Additional information regarding the program's reporting metrics is available in the VCCI 2021 Performance Measurement section below.
The Government of Canada is committed to advancing diversity, equity, and inclusion (DEI) to encourage the Canadian VC industry to be representative of the Canadian population. According to recent research from the CVCA and Diversio, traditionally underrepresented groups face challenges in the VC industry and make up a minority of the investors.
VCCI 2021 follows on a tradition of demonstrating global leadership in DEI in VC. The original Venture Capital Catalyst Initiative introduced in Budget 2017 (VCCI 2017) included a strong focus on supporting gender balance. The VCCI 2021 goes further by introducing an inclusive growth stream to support access to VC for traditionally underrepresented groups, particularly women and racialized communities. It further expands this commitment through an Inclusive Growth Framework that will apply to all VCCI 2021 streams and requires all applicants to collect gender and diversity metrics, as well as implement policies and practices that promote DEI principles internally, in building their portfolios and in the broader VC ecosystem.
The VCCI 2021 invests in funds-of-funds and VC funds to help increase the availability of capital for Canada's high-potential innovative firms. Selected recipients for each stream are listed below.
As VCCI 2021 is a market-driven program, each selected recipient is responsible for engaging with and making their own decisions with respect to investments in venture funds and companies that align with their investment strategies, without involvement from the Government of Canada.
Under VCCI 2021, the Government of Canada sought to increase the availability of capital for promising Canadian technology companies by establishing a balanced portfolio of funds-of-funds. This stream is designed to maximize returns through diversified investments and attract substantial private sector capital. The managers selected under the funds-of-funds stream are:
To promote the growth of Canada's strategically important life sciences sector, the VCCI 2021 has allocated a total investment of $50 million for funds investing primarily in the life sciences sector. This stream is intended to invest in VC funds with the objective of providing investors with competitive long-term returns through investments in VC opportunities, primarily in technology-focused companies in the Canadian life sciences sector. The managers selected under the life science stream are:
To help advance DEI in the Canadian VC ecosystem, the new inclusive growth stream allocates $50 million for proposals enhancing access to VC for diverse fund managers and underrepresented Canadian entrepreneurs. To help ensure broad access to the program, the inclusive growth stream was implemented using two separate intakes of $25 million each. The fund managers selected under the inclusive growth stream are:
The Government sought applications from diverse and talented Canadians inviting them to participate in the VCCI 2021 Selection Committee.
The chair and members of the Selection Committee, supported by ISED and BDC officials, are responsible for evaluating incoming expressions of interest and providing recommendations to the Deputy Minister of ISED on which applicants to select for VCCI 2021. Members of the Committee act on a part-time, volunteer basis.
Further details on the application process and requirements can be found in the Departmental Appointment Opportunities. All applicants are screened to ensure that there are no conflicts of interest.
For more information on the selection committee members, please consult the VCCI Selection Committee page.
Introduced in Budget 2017 and expanded in the 2018 Fall Economic Statement, the Government of Canada invested $371 million through three streams. VCCI Stream 1 invested in large funds-of-funds that support Canadian VC fund managers, while VCCI Stream 2 invested in emerging and diverse managers, underserved regions and sectors, and alternative fund structures. VCCI Stream 3 invested in VC funds investing primarily in clean technology firms.
One of the objectives of VCCI 2017 is to improve gender balance among Canadian VC fund managers and companies. As part of their submissions, applicants under all streams were required to submit gender balance strategies demonstrating how they will enhance diversity and increase the participation of women across the VC ecosystem. All recipients will be required to report on statistics relating to the number of women fund managers and entrepreneurs supported.
VCCI 2017 has leveraged private sector and other capital to inject a total of over $1.8 billion into the VC marketplace, growing Canadian companies and supporting thousands of middle class jobs. More information on these streams can be found at VCCI 2017.
The purpose of this performance measurement framework (PMF) is to outline the metrics that will be used to evaluate the performance of VCCI in delivering on its objectives and outcomes. ISED is committed to releasing annual reports based on the performance metrics.
If you are interested in learning more about the VCCI program, please contact the VCCI Secretariat at capital@ised-isde.gc.ca.
