Kensington Capital Partners have announced the final closing of their Kensington Venture Fund, exceeding their target of $300 million and raising a total of $306 million ($227.9 million U.S.), which will be used to invest in promising Canadian VC funds and technology companies, focusing on the telecommunications, digital/social media, enterprise software, SaaS, mobile, data analytics, and e-commerce sectors, with a primary concentration on Series A/B investments.
“This is a great time to be investing in technology in Canada,” says Kensington Capital Managing Director Partners Rick Nathan. “Our significant talent pool, vibrant startup environment, and improved access to capital – through the Kensington Venture Fund and other funding sources – make Canada a great place to build a technology company and grow it to scale.”
This fund of funds was launched in November 2014, following an initial investment from the Government of Canada’s Venture Capital Action Plan (VCAP), a $400 million strategy designed to increase private sector investments in emerging Canadian technology companies.
“The VCAP program was designed to attract new investors to the venture capital asset class, and is an important source of capital that will enable Canadian funds and companies to continue to drive the innovation economy. Kensington is proud to be actively building the Canadian venture capital market by attracting new investors and significant capital from those that are new to venture investing, as well as from a strong core of experienced technology sector veterans,” says Nathan. “Our Fund highlights the successful collaboration between Government and the private sector to finance the growth of Canada’s technology market. Many of the investors in our Fund have not previously invested in a VC fund. So we are not only providing these investors with opportunities to support emerging new companies across Canada, but we are also financing strong job creation in Canada’s highly skilled, high paying tech sector.”
The fund has so far already invested in 13 venture capital funds, including iNovia Investment Fund 2015, Georgian Partners II, Golden Venture Partners, McRock iNFund, Novacap TMT VI, OpenText Enterprise Application Fund (OTEAF), Whitecap Venture Partners (Whitecap III), and Vanedge II, plus three other funds that have not yet been announced.
The fund has also directly invested in eight companies, including Blue Ant Media, Brightspark, Hubba, and TouchBistro, as well as several co-investments alongside its fund managers.
This most recent closing saw the fund’s greatest mix so far of wealth managers, private foundations, high net worth individual investors.
With offices in Toronto and Calgary, Kensington Venture Fund is targeting investments in Ontario, Alberta and British Columbia, focusing on several key tech sectors at important stages of development, and will also pursue select investment opportunities in the United States.
As of January 2016, Kensington Venture Fund is the lead investor in Vanedge II, the leading venture fund in British Columbia.
Approximately $100 million each into both Alberta and BC across Kengsington’s various managed funds.
“Both of these markets are great places to invest,” adds Nathan. “BC is home to many of Canada’s most successful and innovative emerging new companies, has a highly experienced talent pool that can benefit from better access to capital, and offers great proximity to Silicon Valley while providing a gateway to Asian markets. Alberta is the core of Canada’s energy sector, with many new opportunities emerging in related cleantech and energy technologies.”
As per VCAP’s mandate, many of the investors in the Kensington Venture Fund are new to venture investing, who join previously existing investors, including BMO Financial Group, CIBC, OpenText Corporation, Richardson GMP, Royal Bank of Canada, Scotiabank, TD Bank Group, Torstar Corporation, and the Government of Canada.
The Fund also invests in energy technology funds and companies, including those focused on cleantech, digital oilfields, industrial Internet of Things (IIoT), digital mapping and imaging, smart grid, extraction tech, environmental remediation, and alternative energy.