The Business Development Bank of Canada (BDC) and MaRS Investment Accelerator Fund (IAF), a seed-stage investor funded by the Province of Ontario and managed by MaRS, have held the first closing of StandUp Ventures Fund I.
BDC Capital, the investment arm of BDC, has contributed CAD5 million to the new fund; other investors are being sought.
"I am delighted to see this new fund take flight and I am optimistic that other corporate investors will follow BDC's lead in this regard," says Jérôme Nycz, executive vice president of BDC Capital.
BDC announced that it would create the fund in November 2016.
"Congratulations to the MaRS Investment Accelerator Fund and the BDC for making this ground-breaking investment. We know that Canadian women want to own their own businesses, and yet less than 16 per cent of Canadian SMEs are majority owned by women. Initiatives such as these will help raise that number and give more women entrepreneurs the support they need to succeed, while also making important investments in innovative businesses that will help create the good, middle-class jobs of tomorrow," says Honourable Bardish Chagger, Minister of Small Business and Tourism and Leader of the Government in the House of Commons.
StandUp Ventures Fund I will be managed by the MaRS IAF and will invest in Canadian pre-seed and seed-stage high growth, capital efficient ventures in Health, IT and Cleantech. Qualifying investments will have at least one female founder in a "C" level role with a significant ownership position commensurate with the seed stage of the company. Approximately 12 to 20 investments will be made over the next three to five years, ranging from CAD250,000 to CAD1 million in size.
"Data proves it – more diverse organisations largely outperform homogeneous ones. Our decision to create StandUp Ventures Fund was quickly greeted with strong interest and potential investment deal flow," states Michelle McBane, investment director, MaRS IAF. "We are delighted to have the opportunity to work with BDC to take advantage of this gap in the marketplace while increasing access to capital for women-led businesses which remain proportionately underfunded."
The new fund has led its first investment in tealbook, a platform that helps to make enterprise sourcing of suppliers faster and more efficient through peer-driven supplier knowledge and aggregated supplier intelligence that is easy for users. "The reality is that women entrepreneurs still face additional hurdles when seeking venture capital. This investment will allow tealbook to continue developing its AI/machine learning capacity and go-to-market strategy, giving us a crucial competitive advantage as we grow our market share. We're thrilled to be StandUp Venture Fund's first investee," says Stephany Lapierre, Founder and CEO of tealbook.
BDC has taken a comprehensive approach to supporting the needs of women-led firms and now offers a full spectrum of venture and growth capital solutions. It announced in November 2016 its intention to create a new CAD50 million programme offering both venture and growth capital to women-led firms. This programme will be led by Michelle Scarborough, who recently joined BDC Capital as managing director, strategic investments and women in tech. This programme complements a 2015 BDC commitment to increase its term lending to majority women-owned businesses to at least CAD700 million over three years.
