Venture capital activity surges in first half

In the first half of this year, venture capital activity was up significantly in terms of both deal activity and disbursement levels, says the Canadian Venture Capital & Private Equity Association (CVCA).

According to a new report released today, there were 244 venture capital deals completed, capturing $939 million.

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On the flip side, says the report, private equity saw a similar number of completed deals year-over-year between 2014 and 2015—there were 147 deals in the first six months of last year, compared to 145 deals over the same period this year. But, the amounts invested dropped significantly, with total deal value down from $11.4 billion to $7.8 billion.

In the private equity space, adds the report, the energy sector continues to lead when it comes to overall investments. Deals in that sector accounted for almost half (44%) of all deals for 2015 so far, at a value of $3.4 billion. The four other top sectors were mining & resources ($1 billion), real estate ($1 billion), automotive & transportation ($933 million) and clean tech ($487 million).

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In the venture capital space, the top sector for investment is life sciences, which has seen 39 deals that captured $303 million. That’s followed by clean technology (25 deals and $56 million invested) and agri-business (11 deals and $14 million invested).

“A refreshed approach to venture capital in Canada, combined with recent successes and rising stars, are creating a lot of market momentum,” says Mike Woollatt, CEO of CVCA. “Private investment is leveraging public investment very well.”

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As a result, private capital deal investment is expected to grow, says another recent report. Most polled members of CVCA (82%) say economic conditions favour the private capital industry. Plus, 66% predict a lower Canadian dollar will improve the business outlook for Canada.

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