TORONTO (Reuters) - A Canadian government-backed investment fund set up to help revive the country’s ailing venture capital industry raised C$217.5 million ($198 million) at its initial closing, its backers said on Tuesday.
The Northleaf Venture Catalyst Fund raised C$145 million from institutional and corporate investors, including Canada’s biggest banks, with the rest contributed equally by the federal and Ontario governments.
It will be managed by Northleaf Capital Partners and invest mostly in domestically focused early- and mid-stage venture capital funds, as well as directly in Canadian startups.
The fund is part of a C$400 million plan to support Canada’s venture capital industry announced in the federal budget last year. The fund has a target of raising C$300 million, and plans to hold a second closing later in 2014.
It was backed by Bank of Montreal BMO.TO, Canadian Imperial Bank of Commerce CM.TO, National Bank of Canada NA.TO, Royal Bank of Canada RY.TO, Bank of Nova Scotia BNS.TO, and Toronto-Dominion Bank TD.TO.
Northleaf was spun out of TD in 2009, according to its website.
Other partners in the fund include the Canada Pension Plan Investment Board, the Business Development Bank of Canada, the Ontario Capital Growth Corporation and software company Open Text Corp OTC.TO.
Reporting by Alastair Sharp; Editing by Jeffrey Hodgson