T H E I N V E S TME N T E N V I RONME N T The Impo r t ance o f S t r uc t u r ed Ange l Ac t i v i t y and Gove r nment Suppo r t
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were described as “the staples of the ecosystem”. Support was voiced for a national co-investment fund to invest alongside angels to leverage their investment and expertise. One respondent identified a particular need for government funding for early-stage deep tech companies, which are seen as being too high- risk for venture capital funds, ear- ly-stage funds, and angels, with an added risk that investments in such companies will be illiquid for many years. However, “some will be uni- corns of the future.” Finally, some respondents identified the need to expand the number of angel investors, either by relaxing or
preneurial ecosystem, supporting early-stage high-risk ventures with capital and expertise. As in previous years, there was also support for an angel tax credit. One organization argued that “we need fiscal measures to attract angels’ money to the startup asset class.” The need for a federal tax credit to encourage early-stage investing across provincial borders was also highlighted. A further theme was the need to develop and better integrate the entrepreneurial support infra- structure. Two specific points were made. First was the need to main- tain and develop innovation funding programs. NRC-IRAP and SR&ED
Organizations participating in this report shared a number of sugges- tions on how the government can support structured angel activity. Their comments centred around three themes. By far, the most common comment – as in previ- ous years – related to the funding of structured angel activity, which in turn directly impacts local entre- preneurs, creating jobs and facil- itating business growth. This has several components. First, a strong case was made to maintain the ex- isting support that the government provides and the tax incentives that some provinces offer to investors on account of the critical role that angel investors play in the entre-
202 1 ANNUAL REPORT ON ANGEL I NVEST I NG I N CANADA The Chang i ng Landscape
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