how startups will save venture capital in
canada
Step 1: Cool Idea
Step 2: Get VC
Step 3: ????
Step 4: PROFIT
Here is the problem
Step 2 doesn’t play fair
The funding ecosystem is busted
Early stage venture capital in Ontario
declined from $1.5 billion in 2000
to
$236 million in 2007.
The Downward Spiral
data (c) thomson reuters
The Early Stage is crashing
data (c) thomson reuters
Less startups getting funded
data (c) thomson reuters
Why is the VC business screwed in Canada?
There is NO money for THEM
Poor or No track record
They are too big -- we need more small funds
They lack operational experience
Deal flow looks terrible
Angels and VCs don’t always play nice
VCs aren’t really all that smart either
VCs are being pushed by their LPs
Startups need to be more aggressive
Early stage funding is missing everywhere
Bigger problems
Where is the gap?
$1 Million
$1-3 Million
$3-5 Million
Rounds BCD
Here?
Here?
$1 Million
$1-3 Million
$3-5 Million
Rounds BCD
Here?
Here?
It’s RIGHT HERE
Startups aren’t getting started
and when they do,
there isn’t much funding
and there isn’t much funding because not enough great
startups are getting started which means there are no funds for startups to get
started which means there are no good deals for funds
you get the point
Canada is different
it is decentralized
distributed
gigantic
we are disconnected (from eachother)
there are fewer funds
to cover a big place
and most VCs get queasy investing across town, let alone across
the country
On the other hand,
startups are starting to build communities
(what did I miss?)
and those communities are shaking out the good from the bad
the communities are the deal flow
So, here’s the thing
Funders can stay in their hole,
or they can get out there and hustle
in the meantime, we are going to build
startups
scalable, fundable, high-growth and ambitious
audacious and ridiculous
we will build them all
this time, we are going to build them together
startupcamp
democamp
founders and funders
meetups startupindex
we will take angel money
or perhaps no money at all
and if you still don’t have your act together
in a few years
we’ll go wherever we need to
we are tired of waiting
we are tired of the complaining
so, here is the opportunity
funders must learn to connect to the startup
community
it might be our only hope
smaller funds that can handle early stage deals
micro funds that get startups going on 15k,
20k up to 50k
Entrepreneurs who
blogtwitter
build reputationjoin a community
will not be “unknowns”
before the web,
this was impossible on a large scale
WE have some work to do
we need to
find GREAT startups
blog about them,
talk about them,
add them to startupindex,
drag them out to events
no more hand holding
lead by example
set high expectations
celebrate failure
and celebrate failure again
the great thing about this is
you can do it from right here
no moving
this is moncton
this is toronto
this is halifax
this is sudbury
this is sarnia
saskatoon, surrey, sydney
(that was fun but you get the point)
geography will be meaningless
if we can build strong local communities
and tie them together nationally
then we just might have a chance at doing something great
lets do something great
Jevon MacDonald
twitter.com/jevon startupnorth.ca