Opportunity Beckons in the Canadian Technology Sector

January 20, 2014 Michael Kousaie, Head, Business Development, Technology, TSX and TSXV

A View from the Canadian Capital Markets

Canada. Innovation. Leaders: three words that aren’t always used in the same sentence. But over the last few years, the scene has begun to change, trends are being bucked and today some of the world’s most exciting technology and innovation companies are being founded, built and funded in Canada.

This is due, in large part, to all parts of Canada’s technology ecosystem working together: promising founders are being supported by great accelerators and mentors (like the C100 Charter Members); government programs are encouraging innovation; angel investors and venture capitalists are backing exciting new and established companies; management teams are executing their growth strategies; initial public offering (IPO) investors are providing attractive exit alternatives (more on this below); and strategic buyers are stepping-up with attractive valuations.

Success breeds success, and you only need to read the recent headlines about private companies like Hootsuite, Shopify, Real Matters, Beyond the Rack and many others to see that momentum is rippling across the Canadian technology sector. John Ruffolo, Chief Executive Officer of OMERS Ventures in Toronto, Canada, sees great promise in Canada’s technology scene. “There are more potential [technology] companies in the hopper to go public than I have seen in over 10 years,” says Ruffolo.

This momentum is also evident in Canada’s public equities markets, where the technology and innovation sector (comprised of technology, clean technology and life sciences sectors) continued to stand out in 2013. Before we turn the page on the last year, let’s take stock of the progress made over the last 12 months on Toronto Stock Exchange (TSX) and TSX Venture Exchange (TSXV).

Led by global leaders like Avigilon Corp. (TSX:AVO), CGI Group Inc. (TSX:GIB.A), Constellation Software Inc. (TSX:CSU) and Open Text Corp. (TSX:OTC), the nearly 400 technology and innovation companies listed on TSX and TSXV had a total market capitalization of over $135 billion at the close of last year – an increase of over 50% since the end of 2012. Over the course of 2013, innovation companies raised $6 billion in new capital through 280 financings, and there were 31 IPOs and new listings in the combined sector during 2013.

Not bad for a sector that some called “in decline” a few years ago. With the dotcom bubble far in the rear view mirror, it appears the Canadian innovation industry is making a comeback and demand is growing as companies are returning to the Exchanges. Over the last few years, the sector has moved into the spotlight and shown an impressive depth of talent and dynamism.

What was also interesting about 2013 was that public market investors were not just focused on the largest companies. Of course, the largest TSX-listed companies captured more headlines, but nearly $400 million was raised by the smaller technology and innovation companies listed on TSXV. These are companies with a median market value of less than $10 million. Clearly, public investors demonstrated a willingness to back early-stage businesses in 2013. 

Look out for future blog posts on this site, where I’ll share thoughts on some of the great Canadian success stories in the technology and innovation sector. 

For more information about listing statistics on TSX and TSXV, please click here to consult the Market Intelligence Group (MiG)’s December 2013 MiG Report.

 

This blog post is provided for information purposes only. Neither TMX Group Limited nor any of its affiliated companies (collectively "TMX") guarantees the completeness of the information contained herein. We are not responsible for any errors or omissions in, or your use of, the information we post or information accessed through links to any third party sites. The views, opinions and advice of any third party reflect those of the individual authors and are not endorsed by TMX. TMX has not prepared, reviewed or updated the content of third parties on this site or the content of any third party sites, and assumes no responsibility for such information. Nothing in this blog is intended to provide investment, financial or other advice and you should not be relying on it for such advice. TMX does not endorse or recommend any securities referenced in this blog post. It is not an invitation to purchase securities listed on Toronto Stock Exchange, Montreal Exchange and/or TSX Venture Exchange. © 2014 TSX Inc. All rights reserved. Do not sell, distribute or modify any of the content or materials in this blog post without TMX's prior written consent. Toronto Stock Exchange and TSX Venture Exchange are trademarks of TSX Inc.

 

 

Previous Article
It takes a village to raise a startup – c100 48hrs in the Valley

The role of the CEO in a start-up Listening to Sukhinder Sing Cassidy of Joyus...

Next Article
Wrapping up 2013-the biggest year in C100 history!
Wrapping up 2013-the biggest year in C100 history!

Happy Holidays from the C100 team! 2013 has been a great year for the C100. Over...

×

Join our Network! Stay informed on all things C100.

First Name
Last Name
Thank you!
Error - something went wrong!