The updated program helps startups raise funds using a “white glove service.”
MaRS Discovery District relaunched its flagship Capital program to help keep “high potential” startups in Canada.
The updated program provides select startups with guidance from experienced venture capitalists (VCs) and founders on the fundraising process. The program prepares founders for deal negotiations by running their investment documents through MaRS's in-house CFO and legal teams and then connecting them to a network of global investors.
“This is a program that can significantly improve the chances of companies that are trying to grow and scale staying in Canada.”
“The idea of the program is to find the top 20 to 25 seed and Series A startups from around the country and essentially provide them with a customized experience as part of a fundraising round,” MaRS Capital program manager Liam Gill told BetaKit. “[We] make sure they have a good deck, a good narrative, a good strategy and whatever else might come up as a result [due diligence] already a process, and then we actually help them meet with investors.”
Helping companies raise funds and negotiate terms, MaRS provides resources in the form of public relations, branding and international expansion strategies.
Gill said he joined MaRS in July to get the program back on its feet, which ended last December. While the old version of the program was similar and assisted MaRS companies in the fundraising process, it now extends across Canada and goes beyond MaRS's traditional focus on climate and health technology.
The program, fully subsidized by federal and provincial funding, now targets companies working in the fields of artificial intelligence (AI), defense and dual-use technologies, enterprise software, edtech and, of course, climate and health technologies. However, MaRS is not just looking for any company.
“We basically look for companies that we think have the most likely potential to become an anchor company in the economy,” Gill said, referring to unicorns with a valuation of $1 billion or centaurs with revenue of $100 million. The goal of the program is to help these high-potential companies stay in Canada so they don't have to move to the United States, Gill said.
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He explained that it is difficult to access capital in Canada and that startups naturally turn to the US and perhaps even move to the US to obtain funding. It is hoped that the program will instead make it easier to stay in Canada and allow you to continue working with MaRS and other local partners.
“If you're a founder in Toronto today and you want to raise funds in the next three months, it's much easier to focus your work on [United] States than in Canada; That's the truth,” Gill said. “We can actually introduce you to a lot of investors in Canada and around the world, which means there is no longer any advantage to focusing on investors in the States.”
Toronto Venture Firm Leadership Fund recently identified that Canada's startup pipeline is shrinking, and new data shows Canadian tech entrepreneurs are fleeing the country at an alarming rate.
“We believe this program can significantly improve the chances of companies trying to grow and scale staying in Canada,” Gill said.
MaRS attracts capital program companies from its own portfolio as well as from a network of venture capitalists and government agencies. Tydra Labs, Strello HealthAnd Chemshift Technologies There are already plans to take part in the relaunch. MaRS intends to open applications for the Capital program to the general public this week.
Image courtesy of MaRS.
