Canadian Venture Investor Appetite

12 May

By Cole Bunn, Senior Research Analyst, LSN

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As we are preparing for our first ex-U.S. RESI event, on June 23rd in collaboration with Johnson and Johnson Innovation (JLABS) at the MaRS Discovery District in Toronto, we wanted to take the pulse of the early-stage investment community in Canada by taking a look at some data from the LSN investor platform.

One thing that distinguishes Canada’s venture landscape from the U.S. and elsewhere is the high level of involvement from the Canadian government in the venture world. This is underscored by injections of capital into two separate fund of funds that will invest in several Canadian venture funds as well as venture funds in the U.S. which invest in Canadian companies.

The level of life science innovation in Canada, Toronto in particular, is impressive, with 50% of the country’s life science companies located there, among several other statistics that highlight the economic capabilities of the industry. Major investments in the Toronto Discovery District’s infrastructure from the private sector and the provincial government will also help bolster the early-stage life science ecosystem by adding to and improving the existing resources available to life science startups, including everything from hospital systems and access to patients to incubators and mentorship-type services.

Below is some data on the Canadian investment vehicles, from the LSN investor platform, with the majority of the funds being in $100M-$300M range, arguably the right size for a venture fund to produce the best returns.

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The Canadian investors we’ve spoken to have fairly evenly distributed interests, with the most widespread interest being in medical technology.

Another interesting feature of Canadian investors is that 56% of Canada’s therapeutic investors are interested in pre-clinical assets, and 57% of medical device/diagnostic investors will look as early as products in early development (that is, not yet in the clinic). This bodes well for the entrepreneurs working to commercialize technologies in this region, given that a large portion of the projects are early in their life-cycle.

It seems that Canadian investors recognize the vast amount of opportunity in their backyard, with nearly half of the Canadian investors in the LSN platform being focused solely on Canada.

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We’re excited to bring the RESI conference to Toronto and get a firsthand look at the innovation that is happening in this rapidly developing life science hub, as well as expose the technologies to a diverse group investors and strategic partners.

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