BDC Capital has invested USD6.7 million in Toronto-based Wave, a company that provides online financial tools for small businesses.
This money comes from BDC Capital's new USD150 million IT Venture Fund II announced last month. BDC Capital's investment is part of Wave's Series C funding round, which has now raised USD22.1 million and includes participation from CRV, The Social+Capital Partnership, OMERS Ventures and an unnamed strategic investor in the fintech sector. Wave has earmarked all Series C funds for the ongoing innovation and development of its suite of tools.
The investment was managed by Peter Misek, BDC Capital IT Venture Fund's newly appointed partner in Toronto.
"Wave is looking to solve a key pain point of small business owners by providing a real time view – in a single place – of their company's financial data," says Misek. "Wave has a strong leadership team, has been steadily increasing its number of monthly active users and has solid plans for growth in a sizeable market. Innovation in financial services is the company's next focus. No small business wants to go into a branch for a loan or payments. Wave allows entrepreneurs to focus on running their business by offering them more convenient payment and lending solutions," adds Misek.
BDC Capital's IT Venture Fund II, from which this investment is drawn, was created to address the mid-stage "capital crunch" faced by many growing software companies in Canada. The fund focuses on more mature startups in the mobile, Internet, enterprise, cloud solutions and financial tech sectors that have a product in market and are already generating revenue. Its goal is to help build a new generation of global Canadian IT market leaders. IT Venture Fund II was entirely allocated from proceeds of previous IT Venture Fund investments and other earnings from BDC Capital and its parent corporation, the Business Development Bank of Canada (BDC).
"BDC Capital's participation will have a big impact on Wave," says CEO and co-founder Kirk Simpson. "More than money, BDC Capital brings to the table valuable expertise and connections in the lending and payments sectors, which are key parts of Wave's short-term development plans."
With this participation, BDC Capital gains a seat on the company board, which will be occupied by Misek.
