C ONC LU S I ON Imp l i ca t i ons fo r Po l i cy-Make r s
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government investments, particu- larly where it relates to investments made in business incubators and accelerators and non-dilutive fi- nance programs, creating a stron- ger pipeline of venture capital-ready companies and driving job creation in local communities. Policy-makers need to understand that connectivity is a fundamental component of entrepreneurial eco- systems. The shrinkage or loss of one component in the ecosystem damages its overall effectiveness with one stakeholder – Ray Walia, founder of Launch Academy in Van- couver – observing “that it really is an ecosystem. All these different
venture capital investment in 2020 was the second-highest level of annual venture capital investment based on existing Candian Venture Capital and Private Equity Associa- tion (CVCA) records, with $4.4 bil- lion invested across 509 deals. Total dollars invested by venture capital firms in 2020 were higher than the five-year average ($3.8 billion and 517 deals in 2015–2019) with a low- er number of deals. We anticipate that the lowered average deal size at the angel stage will impact future venture capital activity. Investment into the angel community infra- structure to mobilize more capital at the early-stages of the startup journey will amplify the impact of
It is notable that COVID-19 relief programming favoured venture cap- ital and venture-backed scaleups through the BDC Capital Bridge Fi- nancing Program. This trend con- tinues with the recently announced expansion of the Venture Capital Catalyst Initiative (VCCI) - an im- portant program that facilitates growth capital for promising com- panies. This is problematic to the health of the entrepreneurial eco- system given a proportionate level of investment is required to support angel activity. The events of 2020 have revealed the potential fragili- ty of this key segment of the entre- preneurial ecosystem. In contrast, amidst the COVID-19 pandemic,
202 1 ANNUAL REPORT ON ANGEL I NVEST I NG I N CANADA The Chang i ng Landscape
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