North American healthcare and life sciences venture capital firm Lumira Capital has sealed a $10m commitment for its second fund from the Government of Canada’s Venture Capital Action Plan (VCAP) initiative.
This investment is the first to close of four recently announced commitments under the VCAP to local venture capital funds.
Lumira Capital II invests in North American companies in the biotherapeutics, medical technology and health and wellness sectors. Other investors in the fund include the Business Development Bank of Canada (BDC), Teralys Capital, Fonds de solidarité FTQ, Northleaf Capital Partners, Fondaction and Merck & Co.
Peter van der Velden, managing general partner of Lumira Capital, said, “We are really excited to be partnering with the Government of Canada. In this environment it is critical for a life sciences fund to achieve sufficient scale of commitments to allow it to invest the substantial capital required to build successful companies in the sector.
“The VCAP commitment, along with the earlier commitments of our other limited partners, is really fundamental in allowing our fund to get to that optimal size.”
The investment of $50m in four venture capital funds is the first phase in implementing the VCAP, a comprehensive strategy by the Government of Canada to promote a “vibrant, sustainable” venture capital sector, according to the Honourable Jim Flaherty, Minister of Finance.
“It is very rewarding for the federal government to be able to provide the necessary resources to help support Canada’s venture capital industry. The VCAP recognizes that Canada’s innovative firms represent superior return opportunities, and that private-sector led investments and decision-making is central to long-term success,” said Flaherty.
“We are delighted to see VCAP funds begin to flow. This investment, as well as the many others to come, will undeniably help strengthen venture capital investment in Canada,” added Jérôme Nycz, executive vice president, subordinate financing and venture capital at the BDC. “The BDC has long recognized the importance of a strong, vibrant venture capital industry in helping Canadian entrepreneurs unleash their full potential.”
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