One of Canada’s top funders of early-stage tech companies, the Ontario Municipal Employees Retirement System, is expanding its venture capital business into Europe with the launch of a new €300-million ($455-million) fund.
The pension giant, one of the first institutional investors to return to the depleted Canadian venture capital market following the 2008-09 financial crisis, said its fourth venture capital fund since 2011 will be led by managing partner Harry Briggs, a veteran entrepreneur investor. He will be joined by two other European-based partners, Tara Reeves from seed investment firm LocalGlobe and Henry Gladwyn, who managed seed investments for the founders of AI company DeepMind, which is now a part of Google.
The expansion across the Atlantic – following its recent opening of an office and hiring of a partner in Silicon Valley – does not mean OMERS will reduce its focus on the busy Canadian technology sector, said Damien Steel, managing partner of OMERS Ventures. Rather, it reflects the pension giant’s global approach in other asset classes, including private equity, infrastructure and real estate,
“Being global is in OMERS’s DNA,” Mr. Steel said. “This was always in the plans for OMERS Ventures [and] a natural progression for what was originally set up. Canada has a lot to offer but Europe is a very attractive region from an investment perspective” with buoyant startup markets across the continent and “a large number” of billion-dollar transactions.
Like OMERS’s initial $240-million fund launched in 2011, the European fund will be financed entirely by the pension giant, which had $97-billion in assets under management as of Dec. 31, Mr. Steel said. By comparison, OMERS’s second ($260-million) and third venture ($300-million) funds, drew outside backing from some of Canada’s big banks, Sun Life Financial Inc., Cisco Systems Inc. and U.S. fund-of-funds investor Wafra Group. OMERS Ventures has backed some of this country’s leading technology startups of the past decade, including Shopify, TouchBistro, Wattpad and Hootsuite.
Mr. Steel said OMERS’s European team needs to prove themselves as a group over the course of the first fund before raising outside capital.
“Strategic partners want to know, have you worked together, how do I know you’ll do what you say you’ll do,” Mr. Steel said. “We invested all OMERS’s capital [earlier this decade through the initial OMERS Ventures fund] until we developed a track record. I think the same will hold true for Europe.”
OMERS’s expansion is also noteworthy as Ms. Reeves, a veteran investor in financial and insurance technology firms and co-founder of car-sharing marketplace Turo, becomes the first female named a partner with the pension giant’s venture capital arm, joining a rare group of women to reach that level in an industry dominated by men. A 2017 study co-authored by #movethedial, PwC Canada and MaRS Discovery District, found 70 per cent of Canadian VC firms have no female partners, while just 12 per cent of all partners were women.
The Canadian industry has been working to help fix that imbalance and the federal government, as part of its latest $400-million venture capital funding program, required recipients to demonstrate in their applications how they would work to fix the sector’s gender gap. The Canadian Venture Capital and Private Equity Association recently hired its first female CEO, Kim Furlong, following a stint by venture capitalist Whitney Rockley as the group’s first female chairperson in 2017-18.
Ms. Reeves’s hiring “is a step in the right direction; we just need to see more of it” in the VC industry, Ms. Rockley said. #Movethedial founder Jodi Kovitz said, “While I am encouraged by this news and think it demonstrates the growing recognition of the value of diversity of thought at the leadership table in the venture capital industry overall, I truly look forward to the day that a woman taking up this prominent role is no longer groundbreaking but is instead the status quo.”
Mr. Steel noted that more than half of OMERS Ventures’ associates and principals – junior investment professionals that typically graduate to become partners – are women, and said improving the firm’s’ gender parity at the top ranks “is top of mind for us … I preach and pray for a bit of patience. We are doing everything in our power to address this issue but like anything, it takes time. But we’re getting there and Tara is a great example of that.”