Canadian VC investment falls to $6.07 billion in 2023

Canadian venture capital investment fell to $6.07 billion in 2023, down 37% from $9.64 billion in 2022 and 57% from a record $14.18 billion in 2021, according to analysis from research firm CPE Media.

In 2023, Canadian investors invested $2.62 billion, only slightly ahead of the $2.54 billion from US investors. US and other international investors accounted for 57% of all capital, at $3.45 billion.

The $6.07 billion was invested into 693 firms, at an average funding round size of just under $10 million.

Private VC made up $1.83 billion, with US private VC accounting for $1.13 billion and Canadian private VC accounting for $486 million. Corporate VC invested $1.83 billion in 2023.

Government investors invested $873 million, with Canadian governments representing the vast majority at $851 million.

Forty-two Canadian VC funds raised $1.72 billion in aggregate, the weakest fundraising by Canadian VC funds since 2019, with an average amount of $41 million raised.

Corporate Canada showed a lack of interest in the venture asset class, with no new corporate funds raised in 2023.

"2023 turned out to be another very difficult year for venture capital in Canada after a disappointing 2022. Investment volume was at its lowest level since 2019 while industry fundraising was equally morose,” said Richard Rémillard, president of Rémillard Consulting Group. “The industry continues to be dominated by US, particularly, and foreign sources of capital even from the likes of China.”

Information and communications technology (ICT) companies raised 53% of capital, at $3.23 billion, followed by cleantech ($1.01 billion) and biotech ($937 million).

Companies from Ontario, Quebec, and BC raised $2.64 billion, $1.47 billion, and $1.06 billion, respectively.