Kathleen Wynne, the Premier of Ontario, launched a venture capital fund for the tech sector of Ontario, CBCNews reported. She unveiled the new fund in Communitech, the largest tech incubator in Kitchener-Waterloo.
The public-private venture capital fund will be known as the Northleaf Venture Catalyst Fund. It has already secured commitments amounting to $217 million. The provincial and federal governments have each promised to provide as much as $50 million for the fund. For every $2 invested by the private sector, both governments pledged to invest $1, the report said.
At this rate, the fund would be able to gather as much as $300 million.
Wynne said, "We knew that there were two ingredients that fast growing tech companies need to grow into global players. They need smart people, of which Ontario has no shortage, and they need venture capital."
Toronto-based private market investors Northleaf Capital Partners will be running the fund, the report said. The report quoted Northleaf Capital Partners Managing Director Jeff Pentland as saying, "We look forward to implementing the fund's long-term strategy of constructing a portfolio of high-potential venture capital funds with the scale and resources to execute their plans, support successful high-growth companies and deliver world-class returns."
The report said the fund is hinged on an initiative by the federal government to bolster venture capital for the country's innovation sector. Seed capital from the government is geared towards getting the private sector involved.
Communitech Chief Executive Officer Iain Klugman told CBC's The Lang & O'Leary Exchange that the venture fund will pave the way for a new crop of funds. He sees anywhere from 10 to 15 new funds in various specialties arising from the initial capital, the report said.
The new venture fund is based on the Ontario Venture Capital Fund which was established in 2008. That fund which continues to exist today marked the first time that the provincial government worked with the private sector to lure venture capital, the report said.
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