TORONTO, January 25, 2017 – Investment (all figures in USD) in VC-backed companies based in Canada closed the year with a strong finish, as deals and dollars rose in the final quarter, according to the MoneyTree™ Report from PwC Canada and CB Insights.
The number of deals increased to 266 from 248 (7%) in 2016. Total dollars invested equalled $1.7B in 2016, essentially matching last year’s figure (down 0.3%). Both trends contrast significantly with the global picture, where deals declined 10% and total funding dropped 23% from the heady highs of full-year 2015.
In Q4 2016, investors deployed $527M to Canadian VC-backed startup companies, spiking 49% from the previous quarter. In the same time period, financing was spread across 71 deals, which rebounded 27% from the previous quarter. During the year, quarterly financing topped $500M twice and each quarter during the year saw at least 50 deals completed, the lowest figure being the 56 in Q3.
"Standout annual and quarterly funding trends underscore the strength of the Canadian tech sector. Canada continues to attract significant global attention due to its impressive innovation initiatives and ambitious entrepreneurs." said Chris Dulny, National Technology Sector Leader, PwC Canada.
Activity was strong in both leading Canadian hubs of Toronto and Montreal, which saw total dollars invested rising 10% and 8% in full-year 2016, respectively. The Waterloo Region saw a 65% increase over 2015 due to a deal valued at $120M to wearable computing startup Thalmic Labs. Vancouver saw healthy deal activity, with 2016 deals rising 17%, though total funding declined to $250M from $321M. Sector-wise, Internet and Mobile & Telecom companies led the way, although Healthcare saw a significant decline from 2015.
“Canada’s solid year is especially notable given the context," stated Anand Sanwal, co-founder and CEO of CB Insights. "Whereas many other regions globally have seen a reset after the record financing we saw in 2015, the Canadian funding environment's momentum continued to be strong. 2017 should be a good year given the growth in Canada's home-grown investor ecosystem as well as the interest in the market from US and European investors."
The MoneyTree Report can be accessed here.
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About CB Insights
CB Insights is a Pilot Growth and National Science Foundation backed software-as-a-service company that uses data science, machine learning and predictive analytics to help our customers predict what’s next—their next investment, the next market they should attack, the next move of their competitor, their next customer, or the next company they should acquire. The world’s leading global corporations including the likes of Cisco, Salesforce, Castrol and Gartner as well as top-tier VCs including NEA, Upfront Ventures, RRE, and FirstMark Capital rely on CB Insights to make decisions based on data, not decibels.