More governments in Canada seem to be dipping their toes into the venture capital business. The most recent to test the waters is the Province of Ontario, which said Tuesday that it’s investing up to $50 million in a venture capital fund.
According to the province, the fund is designed to help innovate startups and other emerging companies secure financing to grow their businesses and create jobs in Ontario. The hope is to grow the fund to as much as $300 million over time by leveraging the participation of private investors.
“For Ontario companies to compete on the world stage, our entrepreneurs need access to capital,” said Ontario Premier Kathleen Wynne in a statement. “Our new venture capital fund will help unlock more financing opportunities for these emerging startups, creating the next wave of Ontario-made innovations and Ontario-based jobs.”
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The new fund will build on the province’s Ontario Venture Capital Fund, which invests in Ontario-focused funds that support growing companies. The new fund will be managed by a private sector fund manager selected through a competitive procurement process.
The Ontario announcement follows a move by the federal government in January to earmark $400 million to help Canadian startups gain access to capital. The money will be split between creating new private sector-led investment funds, recapitalizing existing private sector funds, and investment in existing, high-performance venture capital funds.