Giving Back Champions

Giving Back Champions is part three of the three-part series on how the VC & PE industry is giving back to Canadian communities. For more information about the Upside Foundation of Canada, visit their website.

Strong philanthropic values that are truly embraced by a company are ingrained in its culture and will stand the test of both time and organizational change. A good example of this is when an acquisition changes the ownership of a company, but its values and the way they’re demonstrated remain intact. This was the case when Wellington Financial was acquired by CIBC in January of 2018. Their name changed to CIBC Innovation Banking, but their support of the Upside Foundation remained unchanged.

CIBC Innovation Banking has partnered with the Upside directly, as opposed to leveraging their structure to pledge a donation to a Canadian charity. Amy Olah, Executive Director, sits on the Upside Foundation’s Board and historically, Wellington Financial also donated funds to support the Upside— something that Olah says will also continue now, through CIBC.

As an organization that provides growth capital financing to technology companies across Canada and United States, CIBC Innovation Banking sees first-hand the value that the Upside Foundation provides to startup companies. Olah works closely with young software companies from all across North America every day. She explains that while any startup lacks cash, Tech companies in particular need to put a significant amount towards things like research and development and hiring at the outset. ​“That doesn’t leave a lot of money to focus on giving back to the community with a meaningful donation, as much as the company wants to.”

This is where the Upside Foundation comes in, allowing companies to allocate equity or proceeds, ​“so they can feel good about investing, even though their donation will realize later. They can commit now, but give back when they get acquired or go public.” As described in part one of this series, there is a strong business case for embedding social responsibility into a company from the beginning, so the benefit extends beyond making a positive impact on the community.

The main objective of CIBC Innovation Banking in their partnership is to educate startups about the benefits of sharing their upside, while growing the Upside membership as quickly as possible. They achieve this by leveraging their relationships within the Tech community and spreading the word about the opportunities the Upside Foundation provides.

This includes introducing it to the founders of young companies, who might not know they have the option to give back. As Olah explains, it also means educating other partners with connections to startups. ​“I’m just as keen to introduce the Upside to the venture capital community, who in turn will encourage the companies they’re investing in to take advantage of this opportunity to make an impact.”

If we get all of these startups together and make it easy for them to pledge a piece of their upside, it’s a win, win for everybody.

When describing the mission to bring the Canadian Tech community together in giving back, Olah points out that while the Upside is geared towards startups, any private company can make a pledge. ​“There are some companies who realize they haven’t put anything in place in terms of social responsibility and they might decide on a subsequent equity round to allocate a portion to the Upside Foundation”.

CIBC Innovation Banking also leverages its other partnerships to increase awareness of the Upside across the country. ​“We try to get the Upside Foundation exposure at events across the tech community, ensuring that Executive Director Jennifer Couldrey has tickets. I’ll invite her to speak and distribute brochures at events attended by technology software CEOs and CFOs across the country – from Vancouver to Toronto, Montreal and Ottawa.”

Reflecting on why supporting the Upside and giving back in general is so important, Olah says it comes down to the mutual benefit provided to both the companies involved and the greater community. ​“If we get all of these startups together and make it easy for them to pledge a piece of their upside, it’s a win, win for everybody. Collectively, we’ll make a positive impact on the country”. It’s not hard to agree – that’s an outcome worth advocating.

“Over a 15-year period, the Wellington team looked for tangible avenues to invest in our community,” said Mark McQueen, President and Executive Managing Director, CIBC Innovation Banking. ​“By embracing the imagine model, we donated directly and on behalf of our partners, close to $1 million in a variety of worthy healthcare and education initiatives. Under the CIBC banner, and as partners with the Upside Foundation, we hope to encourage other firms to make a similar mark.”