Canada’s venture market is not immune to the global market downturn, but unlike the US – where things seem increasingly gloomy – there are quite a few bright spots in the Canadian ecosystem this year.
Data from the Canadian Venture Capital and Private Equity Association (CVCA) found that C$7.2 billion ($5.28 billion) was invested in 520 deals in the country during the third quarter of this year. This compares to C$15 billion deployed through 786 deals in 2021 (more on Canada’s past year here). In the third quarter, the Canadian market had already surpassed 2020 figures. It’s also worth noting that, unlike in the US, the fourth quarter in Canada isn’t the slowest investment period every year.
Many recent Canadian venture investments have been concentrated in the early stages. According to PitchBook, 88% of known venture deals in Canada so far this year have been early stage or early stage, compared to 67% in the US.
CVCA’s research and product manager, David Kornacki, said that while investment totals were lower than last year, there are many signs this year that the Canadian venture market is moving closer to maturity. First, he thinks the proliferation of seed deals will create a good pipeline of later stage opportunities in the region within a few years, something Canada has struggled with.