Venture Capital Highlights & Key Findings
There were 3 $50M+ mega-deals in the first quarter which accounted for a 30% share of total dollars invested. The largest of these was:
- Kitchener-based Miovision Technologies Inc.’s $120M series C round from investors that included TELUS Ventures and McRock Capital
Information and Communication Technologies (ICT) companies received 54% of total dollars invested in Q12020 ($449M over 59 deals) with life sciences companies receiving a 21% share ($174M over 19 deals).
The pace of VC-backed exits in the 5‑year between 2015 – 2019 (averaging 10 per quarter) slowed with only 3 undisclosed M&A exits in the first quarter.
Canadian Venture Capital Highlights
- The average deal size was $7.1M, an 8% decrease from Q1 last year ($7.7M) and 3% lower than the average deal size during the 5‑year period between 2015 – 2019 ($7.3M)
- Two-thirds of deal flow (75 out of 117) was less than $5M with 19 deals between $5M-$20M totaling $198M
- Ontario-based companies received 61% of investment ($504M); BC-based companies received a 20% ($164M) share followed by Quebec-based companies with 12% ($99M)
- Early stage companies received 50% of all funding ($419M over 72 deals); later stage companies received 41% share ($343M over 14 deals)
- Growth equity deals accounted for 4% of dollars invested ($32M over 4 deals)
Private Equity Highlights & Key Findings
The largest disclosed private equity deals in Q1 2020 were:
- The $840M secondary buyout of Groupe Canam Inc. by Caisse de dépôt et placement du Québec and Fonds de solidarité FTQ
- A follow-on investment into Eddyfi/NDT by Novacap Management Inc. and Caisse de dépôt et placement du Québec totaling over $600M.
- The $344M growth round of Quebec-Based Bestar Inc. with participation from Fonds de solidarité FTQ
While the pace of PE exits slowed, there were some noteworthy transactions:
- The GFL Environmental IPO on both TSX and NYSE with a market capitalization of $7.8B
- The $425M sale of Voortman Cookies by Swander Pace to Hostess
- Novacap’s $347M sale of Calgary-based Interlad to HG
- Clairvest’s $221M sale of Toronto-based County Waste of Virginia to GFL Environmental
Canadian Private Equity Highlights
- 85% (95 out of 112 deals with disclosed values) of PE deal flow were less than $25M
- A quarter of all deals (38 out of 146) were closed in Industrial and Manufacturing sector companies totalling $1.1B, almost a quarter of total dollars disbursed; 14% of deals (20 out of 146) closed in the ICT sector totaling $50M.
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