CVCA Intelligence

YTD Q3 2019 VC & PE Activity: CVCA Data Sneak Peek

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According to preliminary data (final data targeted to be published on November 21), Q3 VC investment surpassed the $2B mark! With $2.4B over 126 deals, this is the biggest quarter we’ve seen in the last six years and more than 3 times that in the same quarter of 2018. This brings the YTD total to $4.6B, already 26% higher than the $3.7B invested in all of 2018.

23 $50M+ mega-deals totaled $2.7B accounting for a 57% share of total dollars invested YTD Q32019, a record high since 2013. Two thirds of this was generated from 9 $100M+ deals, the largest of which included:

  • St. John’s, Newfoundland-based Verafin Inc.’s record-breaking $515M VC Growth deal involving BDC Capital IT Venture Fund, Information Venture Partners Inc., Northleaf Capital Partners and Teralys Capital
  • Vancouver-based Clio raised $332M in growth equity from US investors

In contrast to last year’s exit drought, there have been three VC-backed public listings this year including:

  • Montreal-based unicorn Lightspeed POS Inc.’s $1.1B debut on TMX
  • Montreal-based Milestone Pharmaceutical on NASDAQ with a market cap of $468M
  • Markham-based Edesa Biotech went public on NASDAQ via an reverse takeover with a market cap of $49M

In addition, there have been 29 VC M&A exits totaling $1.4B

Canadian PE investment in Q3 continued the lagging 2019 trend with only $1.5B invested over 94 deals bring the YTD total to $6.1B which is 64% lower than the same period last year(16.8B). The $1.35B mega buyout of London-based Autodata Solutions Inc. eclipsed the remaining activity which remained sluggish in comparison to the previous two years.

Growth deals accounted for a fifth of YTD deal flow amounting to $2.1B, a 35% share of total investment. Buyouts made up a quarter of the 385 PE deals capturing a 25% share of total investment ($1.4B). There were 67 PE debt deals which captured a 16% share of dollars invested (1B).

Companies in the ICT sector received $2.2B over 66 deals while companies in the Industrial & Manufacturing sector garnered $1.2B over 95 deals.

The slowing pace of PE-backed exits continued with only 23 exits YTD Q32019 compared to 82 last year. In this year’s largest exit Industrial Scientific. paid $753M to acquire Toronto-based Intelex Technologies Inc. from HarbourVest Partners LLC and JMI Equity.

The CVCA thanks the following firms who participated in the Q32019 survey: