Inovia holds close on $600m for double fundraise, launches in London

Oscar Geen
19 February 2019

Tweet
Facebook
LinkedIn
Google plus
Send to

Canadian VC firm Inovia Capital has held closes on $200m for its fourth early-stage growth fund and $400m for its growth-stage fund, and announced the launch of its London office.

Inovia initially launched the funds in May 2018 and held initial closes for both towards the end of the year. The early-stage fund is almost fully allocated but the growth-stage fund may take a few more commitments, according to general partner Patrick Pichette.

The early-stage fund initially targeted $200m and the growth-stage fund $400-500m. Pichette said it was capped at this size as it was the maximum amount the firm would be able to deploy.

Approximately 60% of the new funds will be allocated to Inovia's home market of Canada, with the remaining 40% being split between the UK and Silicion Valley. "The political table tennis going on between the UK and the EU is important, but these are businesses with global scope that will quickly expand into North America and Asia so the future relationship with the EU is a small risk," said Pichette.

Pichette will head up the new London office and will hire another senior professional to assist with the growth fund.

General partner Karam Nijjar will be heading up the early-stage team and outlined the firm's four areas of focus to Unquote: "One area that touches on the UK expansion is digital health. A lot of the world's leading academic institutions that are in the UK like Oxford and Cambridge are very active in that field. Beyond that, we look at retail technologies, travel technologies and industry 4.0."

The funds both have a 10-year life with an optional three-year extension and have both already made investments, which will be announced in the coming weeks. Osler Hoskin & Harcourt provided legal advice on the formation of the fund.

General partner Shawn Abbot explained that unlike some other VC firms, Inovia has had the ability to invest in cryptocurrencies for a while: "We've looked at investing in crypto as an asset without thinking the LPA would restrict us from doing so. A lot of startups have used it as a form of shadow equity but it's not been able to generate returns because of the relationship to underlying equity; or at least there's a lot of confusion about how the value of the enterprise accrues to those two different forms of underlying ownership, so that's stopped us a couple of times."

Investors
The firm has three categories of LPs, according to Pichette. The first is larger institutional investors, more strongly supported now by leading Canadian banks that have not historically been active in PE and VC, and pension funds. Secondly, family offices have been an area of growth in the latest fundraise. A third pocket is strategic individuals that have worked within Inovia's network in the past.

Investments
The early stage fund will make investments of between €1-10m, while the growth stage fund will target tickets of €20-35m in €50-100m rounds.

People
Inovia Capital - Patrick Pichette, Karam Nijjar, Chris Arsenault, Shawn Abbot (general partners).