L-Spark has taken the pulse of Canada’s software-as-a-service (SaaS) ecosystem and concluded it’s healthier than it’s ever been.

The Kanata, Ont.-based SaaS accelerator’s new “State of SaaS 2017,” report, released today to coincide with its SaaS North conference in Ottawa, found that Canada’s SaaS companies received Canadian investments worth $1.02 billion in the first three quarters of 2017 alone, spread out over more than 100 deals – and the average deal, L-Spark director of marketing Jamie Petten told ITBusiness.ca, was worth about $10.8 million.

L-Spark director of marketing Jamie Petten says that Canada’s SaaS ecosystem is proving how well it can compete with the U.S.

“The investment in our Canadian software companies validates that Canadian founders and Canadian tech entrepreneurs can grow and scale here,” she said. “They don’t need to solely look south of the border for venture capital funding, nor do they need to rely on moving south of the border in order to continue to grow.”

L-Spark also noted that Canada’s SaaS ecosystem received $743.1 million in outside investment, mainly from the U.S.

The sectors that received the most investment, the organization found, were marketing and sales, which received 16 deals; AI and chatbots, which had 14; and fintech, which saw 13.

In addition to the average deals, L-Spark found nine companies that were receiving investments worth $50 million or more: Wealthsimple, Tulip Retail, Breather, Ritual, FreshBooks, Borrowell, Visier, Vision Critical, and Element.ai.

Meanwhile, eight public Canadian SaaS companies – OpenText, Descartes, Tucows, the Stars Group, Cloudera, Sphere 3D, Kinaxis, and Shopify – received $141.3 million in funding.

“In previous years, I think the Canadian ecosystem has put a lot of focus and investment into startup activity at the grassroots level, preparing products and early stage founders with sustainable growth metrics and the appropriate infrastructure,” Petten said. “But now we’re seeing that many of our past early-stage deals are maturing, and they’re yielding strong, repeatable month-over-month growth, which is driving investment into companies that are growing and thriving here.”

She noted that L-Spark has also observed companies such as Markham, Ont.-based real estate data and software firm Real Matters, which enjoyed an initial public offering in May worth $157 million, successfully exit into the Canadian market.

“As we continue to see these Canadian companies choose to grow and scale here, it only further justifies the investment that’s gone into them,” Petten said.

You can read more about L-Spark’s research here, or check out the infographic below (click for a larger version).

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