The Montreal firm is backed by the Quebec government, Desjardins Capital and nearly 50 individual LPs.
Montreal-based Amiral Ventures has raised C$40 million from the Quebec government, Desjardins Capital and dozens of tech entrepreneurs for its first fund, which aims to pursue early-stage deals amid the domestic slowdown in venture capital (VC).
The venture capital firm, founded by lifelong entrepreneurs and investors Frédéric Bastien, Dominique Becotte and Nektarios Economakis, held its first close on Monday for its $75 million endowment fund after nearly three years of fundraising. The provincial government secured the fund through Investissement Québec, Desjardins Capital wrote the first check, and nearly 50 investors and entrepreneurs joined as limited partners (LPs), including co-founders of Quebec startups BrainBox AI and Workleap.
“Every time leadership is transferred overseas, Canada loses ownership of its most successful businesses.”
Manifesto Amiral
The firm plans to back 15 technology companies between the seed and Series A stages, with annual revenue typically ranging from $750,000 to $1 million, managing partner Bastien told BetaKit yesterday. The fund focuses on sectors such as enterprise artificial intelligence (AI), robotics, supply chain technology, manufacturing, and startups that “enhance enterprise productivity, resilience, and sustainability.”
Amiral has already supported enterprise software startup Maxa and based on artificial intelligence architectural platform Layout. The fund is led by Bastien and co-managing partner Becotte, and partner Economakis. Julie Lacasse, LP at the fund and board member of several Quebec technology organizations, will join as a venture partner. The meaning of the word “Amiral” is twofold: it resembles a flagship (flagship in French) and refers to the white admiral butterfly, the official insect of Quebec (Economakis received butterfly tattoo when the fund held its first close).
Two-time founder and angel investor Bastien said he is continually “frustrated by the lack of leadership in the venture capital ecosystem in Canada.” While raising funds for the Series B of his second startup, he ended up traveling to the US, getting a term sheet in San Francisco and returning to find a host of Canadian venture capitalists interested in filling the round. Bastien's concern was repeated privately by Canadian venture capitalists, some of whom argued at the April CIX summit that the country's early-stage venture capital ecosystem has “more price takers than price setters.”
Amiral aims to fill this leadership gap almost exclusively through rounds, which is in keeping with the firm's ethos, Bastien said. “Every time leadership is transferred overseas, Canada loses ownership of its most successful businesses,” Amiral’s manifesto states. “The investor-follower ecosystem creates subsidiary economies, when we need global leaders.”
That doesn't mean U.S. investors shouldn't participate in Canadian deals, Bastien explained. But allowing them to consistently lead is “the surest way to get smaller acquisitions and Amazon subsidiaries instead of creating new Shopify ones,” he said.
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Because the Quebec government is the anchor investor, Amiral will have to use three-quarters of its first $40 million to support Quebec startups. Bastien said Amiral will source records from outside Quebec to raise the remainder of its $75 million fund. This means that by the time of final closure, the fund is expected to have only 50 per cent of its total capital in Quebec.
Amiral enters the Quebec venture scene in particular dark time for investment activities. While pre-seed and seed-stage investments saw modest growth over the summer, Réseau Capital CEO Olivier Quenneville told BetaKit in August that “overall deal flows remain relatively weak compared to historical levels.” Fundraising for venture capitalists has also been difficult, especially for first-time managers, as average incomes and no exits made institutional investors more cautious about supporting funds.
As a first-time fund manager, Amiral was no exception. Bastien called the three years he spent fundraising “the most difficult in a decade.” He said that a year and a half ago, the team could have had a first close of $15 million to $20 million, but decided to stick firmly to its $40 million goal to ensure it could top all of its deals. “You can’t do that with a $250,000 check,” he said.
The early-stage Quebec ecosystem, largely supported by the provincial government, now has several new entrants. Telegraph Ventures Supplementary Fund WithWithearned $35 million for startups in the field of artificial intelligence in September; A month later, Investissement Québec reinstated its popular early-stage funding program. $200 million venture fund. Local firm Boreal Ventures plans to raise a second fund in the new year, and major player Inovia Capital I am planning two new funds to support startups and venture capitalists.
Image courtesy of Amiral Ventures.
