Here at Streetwise we often focus on big deals, but for just a moment it's worthwhile to look at some of Canada's smallest. Venture capital transactions may not be as sexy, but they are vital for the small businesses that drive Canada's economy.
CVCA, the Canadian Venture Capital and Private Equity Association, is out with a new report Wednesday that offers an overview of what happened in VC in 2010. In short, things are looking up. Canadian venture capital investments hit $1.1-billion last year, about 10 per cent higher than the 2009 lull, driven by Canadian VC funds that are starting to redeploy money.
Among the biggest deals (of those that were disclosed), Enerkem Technologies takes the top spot, having raised $54-million last year. The company develops technology that converts residual materials, such as non-recyclable municipal solid waste, into clean transportation fuels, advanced chemicals and green electricity. Investors include Rho Ventures and Braemar Energy Ventures.
Biotech firm CellFor Inc., which produces superior tree seedlings without genetic modification came in second, raising $36-million from investors like Capricorn Investment Group and CSFB Equity Partners.
Protox Therapeutics was close behind, raising $35-million from Warburg Pincus. The company transforms natural proteins for the treatment of prostate cancer and others.
You may notice that these companies all relate to either cleantech or life sciences, which some predicted would fall by the wayside when the market crashed. Not only did these sectors sport the biggest VC deals, they're also driving the market's return, CVCA's report noted.
The two sectors accounted for about 40 per cent of all Canadian VC last year, and each had big increases in total investment. Life sciences investment jumped 38 per cent over 2009, while cleantech investments jumped 58 per cent.
Tim Kiladze