Data & Analysis

The Canadian VC Market: Healthy Across All Stages

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I often find myself in various conversations where I hear a very similar statement. It’s normally something along the lines of, Sure, we have plenty of interest in the seed and early stage venture rounds. What we’re missing in Canada is support for the later stage venture rounds.” While I don’t aim to disprove this here, I do want to provide a commentary of the overall health of the industry.

With the recent news of Montreal-Based Hopper’s giant 100M USD Series D round, overall later stage VC activity has been increasing steadily year-over-year. H12018 is the strongest first half we have on record, with 97 later stage deals and $901M invested (3 deals more and a 182% increase in dollars versus H12017; average later stage deal size increased 176% from 5.3M to 9.3M). This steady growth in activity and dollars invested in the later stage rounds shows us that: firstly, Canadian startups can make it to later stage rounds, and secondly, Canadian startups are receiving increasing support in these crucial expansion rounds.

The swell in later stage activity has not been cannibalizing earlier stages. H12018 was also the strongest first half we have on record for seed funding rounds, with a record-breaking $142M invested across 106 deals. By comparison, H12018 saw an increase of 31 deals and $36M dollars invested vs H12017. This means our ambitious Canadian entrepreneurs can hit the ground running having more access to seed capital than ever before.

Finally, although we didn’t have an all-time high first half in early stage funding rounds (third place after 2017 and 2016 for dollars invested), early stage funding remains steady with the average deal size 18% higher than the average for the last 5 years ($6.3M and $5.4M respectively).

Stringing together the strongest first half in both seed and later stage funding rounds with the steady investment activity in early stage rounds, the VC industry in Canada is fuelling Canadian startups across all stages.

If you’re interested in learning more about the VC market in Canada, the CVCA offers the most comprehensive database on Canadian private capital investments, exits and fundraising activity. For more information, check out the Industry Data section on our website here.