There has been a familiar refrain over the years here in Canada that our startups have less access to capital than our peers in the US. That message is supported by facts. On average, our startups do in fact have significantly less capital (3 – 10x in some cases) then US peers.
But what’s missing in these historical stats is that VC is now global. The Valley is more competitive than ever. Valley VCs are increasingly hopping on planes to find great, affordable deals.
It’s been a few years now that US VCs have been coming to Canada en masse. Tax regulations have helped (elimination of a nasty withholding tax for US investors). But the main drivers have been great deals and ability to get into those deals on reasonable terms.
Last week, Vancouver’s Hootsuite announced a mammoth $165M funding round. The largest ever for a Canadian software company. I hope that this round forever lays to waste the argument that our startups don’t have access to capital.
Capital is global. If you are building a great company VCs will find you. Trust me.
It may be harder to raise seed, early stage capital these days thanks to the basic laws of supply and demand. But those laws are reversed when it comes to growth stage. If you can get to $10M+ in revenue, every growth stage VC will be your new best friend.
Build it and they will come…