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After Slow Start to 2023, VC in BC Returns to ‘Pre-Pandemic Momentum’

February 26, 2024 by Knowlton Thomas Leave a Comment

A B.C. company building a scalable, fault-tolerant, and unified quantum computing platform secured in November US$100 million.

Photonic’s capital hailed from a variety of contributors, including the British Columbia Investment Management Corporation, the National Security Strategic Investment Fund in the UK, Inovia Capital, Amadeus Capital Partners, and Microsoft.

The sizeable round of fundraising is a marked boon to the firm, but it didn’t just put lift under the wings of Vancouver’s Photonic, however—it elevated the province’s venture capital investment standing for the year.

B.C.’s VC market was suffering from a “slow start” to the year, according to a recently released report from the Canadian Venture Capital Association, but ended 2023 strong.

Things began to pick up in April, when Web3 messaging platform LayerZero Labs disclosed a massive Series B.

Leveraging data from the CVCA Intelligence platform, the organization’s quarterly market overview reports offer analyses of the Canadian market, providing a panoramic view of private capital trends.

In 2023, Canadian VC witnessed a cumulative investment of $6.9B across 660 deals, with the fourth quarter attracting $1.4B over 142 deals, the year-end report shows.

These data demonstrate “a return to pre-pandemic momentum despite a year-over-year slowdown caused largely by rising interest rates and economic uncertainties,” according to CVCA.

“The Canadian VC market has reacted with moderation to the challenging factors creating headwinds for the sector,” stated Kim Furlong, Chief Executive Officer of CVCA. ​“With capital tightening and being selectively allocated to high-potential sectors . . . 2023 showcased the industry’s resilience.”

Ultimately, B.C. held its own, closely behind Quebec for second place nationwide in terms of deals done and volume invested.

“In 2023, Ontario, Québec, and BC maintained their positions as the top provinces for VC investments, representing 86% of the total investments completed in 2023,” the report reads.

B.C. saw $1.2B invested across 92 deals in 2023, compared to Quebec at $1.4B and 136 deals.

Breaking it down by city, Vancouver ranked third in Canada with $700M invested across 64 deals (behind Montreal’s 100 and Toronto’s 196 deals).

Victoria, with $45M across 14 deals, came in 8th.

Moving forward, “there is cautious optimism in the market,” says Furlong, who believes that Canada can “navigate the current financial landscape’s complexities while continuing to support innovation.”

Filed Under: News Tagged With: CVCA, LayerZero Labs, Photonic

 

About Knowlton Thomas

Knowlton Thomas is Editor-in-Chief of The Midway Advance and Senior Writer for Techcouver. Over more than a decade of journalism, he has penned thousands of articles and dozens of essays on technology, health, and culture across a variety of publications.

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