Canadian VC disbursements reach record high of $13.58 billion in 2021

Canadian venture capital (VC) disbursements reached a record high of $13.58 billion across 716 financings, according to analysis from research firm CPE Media.

The record-setting VC investment in Canada was driven by US and foreign investors, with foreign capital accounting for 72% of total disbursements. US investors represented 56% of total disbursements, at $7.6 billion.

Canadian investors fell to 28% of disbursements in 2021, down from a pandemic-induced high of 48% in 2020.

US VC firms, US hedge funds, and Canadian VC firms were the top investors, at $3.51 billion (26%), $1.43 billion (11%) and $1.20 billion (9%) respectively. “The dominance of venture capital investment volumes from the US is testament to the attractiveness of the Canadian innovation market but at the same time betrays an over-reliance on the US which could place Canada in a vulnerable position should American funds pull back and given the relatively small amounts of venture capital drawn from other international sources,” said Richard Rémillard, president of Rémillard Consulting Group.

Companies in Ontario, BC, and Quebec received the overwhelming majority of financing, at $5.92 billion, $3.93 billion, and $2.59 billion respectively.

Investment was unsurprisingly focused on Canada’s major economic and population centres in Toronto ($4.44 billion), Vancouver ($3.48 billion), and Montreal ($2.01 billion).

ICT and biotech companies attracted the bulk of investment (78%), receiving $8.73 billion and $1.98 billion respectively.

Early-stage and growth/late-stage financings led in total disbursements, securing $6.91 billion and $4.91 billion respectively.