Tech companies led by women entrepreneurs will soon be able to draw on the largest women-focused venture capital fund in North America, following today’s announcement by Minister of Small Business and Tourism Bardish Chagger.
Chagger, who is also MP for the riding of Waterloo, led off a Women in Tech luncheon Wednesday at the Tannery Event Centre by announcing a $20-million increase in a BDC Capital-administered program that directs early investment to women-led Canadian companies.
The Women in Tech investment program was launched last year with a $50-million investment.
Today’s announcement builds on that initial investment.
Chagger said that today’s entrepreneurs realize that they aren’t competing against other Canadian communities: “We compete against the world.”
She said that “Canada is in a global competition for the best ideas, brightest people and boldest companies,” saying that support for women-led enterprise will be part of winning that competition.
Following her on stage was Michelle Scarborough, BDC’s Managing Director, Strategic Investments and Women in Tech, who said that, for the moment, the Women in Tech fund has a fairly limited field of companies to draw from: roughly five per cent of Canadian tech companies have a woman as CEO, a percentage that increases only slightly as more members of the management team are included. Only about eight per cent of the boards of tech companies have C-level women members; 73 per cent don’t have any women at all. The numbers aren’t much better for the agencies that fund startups: Only 12 per cent of VC firms have women as partners.
What investors need to know, says Scarborough, is that companies that have or had women as CEOs are 15 per cent more likely to exceed their revenue targets. Diversity is good for business, she said, adding that the landscape is changing. “If we’re going to foster the next generation of female-led tech companies, this is a fund that is going to do that.”
The Women in Tech program is managed by BDC Capital, the investment arm of the Business Development Bank of Canada, with $60 million set aside for direct investment in Series A and sometimes Series B rounds, with BDC acting either as a lead investor or part of an investment team. The remaining $10 million is earmarked for indirect investments in regional projects.
Since November 2016, the Women in Tech fund has committed $3 million in nine investments in women-led tech firms, including Toronto-based Nudge Rewards, which developed an employee performance platform; Kitchener-based Bridgit, which provides timesaving software for construction crews; and the Waterloo-based Plum, which has developed a predictive hiring tool.
Scarborough went on to lead a panel drawn from the three companies — Mallorie Brodie, co-founder and CEO of Bridgit; Caitlin MacGregor, CEO of Plum; and Lindsey Goodchild, co-founder and CEO of Nudge — who spoke from their own experience and offered advice to upcoming entrepreneurs, of any gender.