Alberta Enterprise Corporation (AEC) has launched its fourth early-stage, Alberta-focused angel co-investment fund with a $15-million CAD anchor commitment.
The Accelerate Funds aim to spur more private investment in Alberta’s emerging tech sector.
The launch marks the first close of Accelerate Fund IV, which aims to raise a total of $25 million from institutional investors, family offices, high-net-worth individuals, and other strategic players to back pre-seed and seed-stage Alberta technology startups.
Accelerate Fund IV will be managed by Vancouver-based venture capital (VC) firm Yaletown Partners, which also oversaw Fund II and Fund III and has offices in Edmonton and Calgary.
AEC vice-president of investments Rebecca Giffen told BetaKit that Accelerate Fund IV’s strategy will be similar to its past funds, but noted that it will have a greater focus on companies on certain verticals.
“As we managed Fund II and Fund III, we discovered, life sciences, digital transformation, and artificial intelligence are areas where Alberta has standout strengths in technology innovation,” Accelerate Fund II, III, and IV investment manager Arden Tse of Yaletown said in a statement.
The Accelerate Fund program targets privately held Alberta companies with proprietary tech, some customer traction and revenue, and over half of their employees located in the province. It co-invests in financing rounds alongside angel investors, family offices, and foundations, typically investing up to $500,000 under the same terms and conditions as other investors. The Accelerate Fund requires a matching or greater commitment from private backers.
Four members of Yaletown will support Accelerate Fund IV: Tse, partner Brad Johns, investment associate Yasmine Al-Hussein, and industry advisor Neil Frizzell.
Established in 2012 by AEC, the Accelerate Fund program is designed to encourage more private investment in Alberta’s emerging tech sector. Its first $10-million fund was launched in 2012 and managed by AVAC Group. Accelerate Fund II was nearly $10.5 million, a figure that included $10 million from AEC and nearly $500,000 from private Alberta investors. Unveiled in 2016, that fund was managed by Yaletown with support from the A100.
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Launched four years ago with an initial $10 million from AEC, Accelerate Fund III ultimately grew to $23 million. This amount included an additional $5 million from AEC, $6 million from the Opportunity Calgary Investment Fund, and $2 million from undisclosed private backers. This fund was also managed by Yaletown with support from The A100.
To date, the Accelerate Funds have backed 46 Alberta-based companies, including DrugBank, Helcim, Ontopical, PayShepherd, Samdesk, StellarAlgo, Userful, Virtual Gurus, WaitWell, and Wyvern. Accelerate Fund exits include Circle Cardiovascular, Decisive Farming, and Passportal.
“The Accelerate Funds are core to our strategy in activating capital, in particular angel capital, to pre-seed and seed companies in the province,” AEC CEO Kristina Williams told BetaKit.
Williams said AEC has been impressed by the Accelerate Fund team and their progress to date. “The impact of the Accelerate Funds can be seen in the graduation to later-stage financing and the tremendous growth of these companies,” she added.
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For every dollar invested by an Accelerate Fund up to this point, AEC claims that 10 times that amount has been invested by angels, family offices, and institutional investors.
Backed by the Government of Alberta, AEC promotes the development of the province’s VC industry by investing in VC funds that finance local tech companies. AEC targets funds with a strong commitment to Alberta and a full-time presence in the province.
To date, AEC has committed $415 million across 39 VC funds, including Amplitude Ventures, Brightspark Ventures, Graphite Ventures, Luge Capital, Panache Ventures, and Yaletown.
“Many of North America’s leading venture capital funds now have representatives in Alberta, and we’re welcoming record numbers of founders, software engineers, and other talent from across Canada and internationally to build technology businesses here,” Alberta Minister of Technology and Innovation Nate Glubish said in a statement. “With this latest deployment of capital, we invite early-stage tech companies to stay and grow here, and to expand Alberta’s technology jobs and innovation.”
Feature image courtesy Accelerate Fund.
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