POLICY RECOMMENDATIONS Canadian Moonshots
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Recommendation 3: A Fund-of-Funds Program to Activate New Sources of Angel Investment for Can- ada’s Entrepreneurs That the government invest in a national fund-of-funds program to help activate new sources of pre-seed in- vestment for Canada’s entrepreneurs. Government investment in a national fund-of-funds program will help activate first-time angel investors at an unprecedented scale, including mobilizing angel in- vestment into institutional funds, and corporate inves- tors into the angel funding ecosystem: unlocking new sources of private sector investment for entrepreneurs building high growth companies. VCCI demonstrated the efficacy of government investment in fund-of-funds programming. More than $1.4 billion of the $1.76 billion raised by VCCI funds was from private investors. In oth- er words, the private sector was inspired to invest
angel investment opportunities less risky. If the risk of a particular investment opportunity is lowered, angel in- vestors will have a higher capacity to assume additional risk and make further angel investments. The net effect will be an increased amount of funding, mentorship, and support available to Canada’s entrepreneurs: helping to immediately increase access to opportunity for entre- preneurs building companies at the earliest stage. On a regional level, matching funds will significantly in- crease the amount of capital entrepreneurs are able to raise in rural areas, Northern communities, and non-ur- ban centres, where access to funding is scarce. The due diligence work of vetted private sector invest- ment partners can be leveraged to provide additional capital, through matching funds, to high-potential en- trepreneurs.
2023 ANNUAL REPORT ON ANGEL INVESTING IN CANADA
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