Toronto top market as Canadian VC funding increases for third year

10 February 2020 Consulting.ca

Toronto companies led venture capital funding in 2019, as overall Canadian funding rose for the third consecutive year, reaching $4.1 billion (all figures US) and 469 deals, according to a MoneyTree Canada report from PwC and CB Insights.

Toronto funding breached $1.3 billion for the second consecutive year, with a deal count of 175, which was five below the deal volume in 2018.

Vancouver-based startups raised $924 million, doubling the investment level in 2018. Deal activity fell to 72 deals from 109, with larger average deal sizes driving the gains in funding. This reflected the wider Canadian scene, where deal count declined by 11%, but funding increased by 16%.

Montreal funding fell marginally by $11 million to $931 million. Waterloo and Calgary rounded out the top five markets, raising $139 million (25 deals) and $132 million (22 deals) respectively.

Top markets of 2019 vs 2018 by deals

"Canadian venture capital investment increased for the third year in a row as Toronto and Vancouver hit record funding highs in 2019," said Anand Sanwal, co-founder and CEO of CB Insights. "Seed- and early-stage rounds made up the majority of deals, and investments in Canadian AI, fintech, and cybersecurity companies continue to grow.”

VC-based AI companies hit record funding and deal levels, with funding increasing by half (49%) to reach $658 million, while deal activity increased to 57. Fintech companies also hit high-water marks, more than doubling funding to $776 million and boosting deals by 11% to reach 59 deals.

Canadian cybersecurity companies also reached a new high, at $398 million investment across 19 deals.

The most active investors in Canadian companies in 2019 were BDC, Real Ventures, SOSV, Panache Ventures, Investissement Quebec, and MaRS Investment Accelerator Fund.


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