Q-News

January 2010

Private Equity - December 2009 / January 2010

Posted in Private Equity

Following November’s weak numbers (which represented the ugliest month we’ve seen since we started tracking financing data in 2002), we were glad to see slightly better results for December.  In total, there were seven transactions reported (with six including details of the actual amount of capital raised), totaling $98.6 million.  Although the total amount of capital raised was considerably higher than in December 2008 (12 transactions reported for $35.8 million), $75 million or over just three quarters came from one transaction – DAVE Wireless.  Ontario was the only province with two transactions while other announcements came out of Quebec, Alberta, Nova Scotia, New Brunswick, and British Columbia. 

 

There were eight financings announced in January 2010 for a total of $75.7 million in new capital.  The totals were practically on par with the eight deals and $76.3 million in capital raised in January of 2009.     

 

 

Financings of Canadian Companies – December 2009

 

Toronto-based DAVE Wireless, a soon-to-be new player in Canada’s cell phone carrier market, secured $75-million in new capital.

 

Coveo, a leading provider of information access and search solutions for the enterprise closed a Series B financing of $8.2 million. The deal was led by the Business Development Bank of Canada.  The other participants in the transaction were Propulsion Ventures SEC, The Solidarity Fund QFL, and a group of private investors.

 

Redlen Technologies, a BC-based based developer of semiconductor imaging technology, raised $ 5.2 million.  The identity of the participants in this round was not disclosed, although back when the company raised $2.3 million in March of 2004 the funding came from Yaletown Venture Partners.

 

Nova Scotia-based SimplyCast, which providers email marketing, event management, and online surveys for small businesses, completed a $1 million Series A round.  The identity of the investor(s) was not disclosed.

 

The New Brunswick Innovation Foundation (NBIF) made a $500,000 investment in Encore Interactive, a New Brunswick-based company that develops software for the telecom industry.

 

 

Financings of Canadian Companies – January 2010

 

Wellington Financial LP  led a $31.2 million financing completed by Toronto-based SkyLink Aviation, which uses its large fleet of rotary wing aircraft to carry out charter and cargo missions around the world.

 

Toronto-based ecobee announced the receipt of $6.73 million in venture financing from the Ontario Emerging Technologies Fund (OETF), JLA Ventures and Tech Capital Partners.  The company has developed an intelligent web-based thermostat aimed at helping homes and businesses conserve energy.

 

Switch Materials, a Vancouver-based developer of energy-saving window materials based on proprietary organic molecules, announced a $7.5 million Series B financing. BDC Venture Capital led the round, and was joined by return backers GrowthWorks, Pangaea Ventures and Ventures West.

 

eSight Corporation, an Ottawa-based company developing wearable electronic vision devices, raised $750,000 from First Leaside Visions II Limited Partnership, a registered Ontario Commercialization Investment Fund (OSIF). The Province of Ontario was already involved with eSight through a $500K investment from its Investment Accelerator Fund.

 

Nova Scotia’s STI, a marketing solutions provider to the healthcare industry, raised a total of $2 million in follow-on financing from GrowthWorks by way of a $1.5 million injection from GrowthWorks Atlantic Venture Fund and $0.5 million from GrowthWorks Canadian Fund.

 

 

US and International Activity in Canada – December 2009

 

Sverica International (MA) made an investment in Care Factor, a data center service provider operating out of Alberta.

 

The Toronto-based pharmaceutical company NeurAxon raised $8.75 million in unsecured debt.  Montreal-based CTI Life Sciences Fund led the deal and was joined by existing investors. Canadian investors included Vancouver-based Ventures West Capital Ltd, BDC Venture Capital. US-based investors included Delphi Ventures (CA), OrbiMed Advisors LLC (NY), H.I.G. Ventures (FL), NeuroVentures Fund (VA). The company’s CEO Lawrence Bloch also participated in the financing. The company had previously raised over $32 million in VC funding.

 

 

US and International Activity in Canada – January 2010

 

Morgan Solar, a Toronto-based developer of concentrated photovoltaic systems raised an additional $3.5 million add on to its first round of financing, which had previously been reported as $4.7 million in October 2009.  The round was led by Connecticut-based Turnstone Capital Management LLC.  Strategic investors participating in Morgan Solar’s first round are Inversiones Financieras Perseo SL, the venture initiative of the Iberdrola Group, a Madrid-based energy company, and Nypro, a Massachusetts-based plastics company.  Sustainable Development Technology Canada contributed $2.3 million of the top-up investment.

 

California-based Redpoint Ventures led a $14 million equity raise by Vancouver-based Tantalus Systems, a developer of smart grid solutions for the utilities industry.  The company has raised approximately $43 million over the last three years.

 

Montreal-based Averna, a test engineering firm servicing the communications and electronics device maker industries, announced $10 million in new venture funding.  The funding came from Japanese electronics firm Onkyo, as well as return backers Altien Ventures (OR), Bessemer Venture Partners (CA), Best Buy Capital, DAG Ventures (CA), Intel Capital, Panasonic Venture Group (CA), Polycom (Delaware) and Redpoint Ventures (CA).  The company has raised a total of $52 million in VC funding since opening shop in 1999.

 

 

Canadian Investments Abroad – December 2009

 

Celtic House Venture Partners and EdgeStone Capital Partners made a follow-on US$5.6 Million investment in RedMere, a fabless semiconductor company based in Ireland.

 

MMV Financial made a US$2.5 million venture loan to CheckPoint HR, a provider of web-based human resource software to the SME market. The New Jersey based company is backed by Edison Venture Fund.

 

iNovia Capital was one of the investors involved in a US$6.75 million raise by California-based Vizu Corporation, the company behind Ad Catalyst, a digital ad effectiveness measurement system.

 

iNovia Capital also participated in a US$1.5 million of Series A financing by LegiTime Technologies, a Connecticut-based SMS Features provider.

 

 

Canadian Investments Abroad – January 2010

 

Wellington Financial LP (ON) invested US$5 million in venture debt in Boston-based Ember Corporation a developer of wireless mesh networking technology.  Among Ember’s previous VC backers are Chevron Technology Ventures (CA), Stata Venture Partners (MA), Polaris Venture Partners (MA), GrandBanks Capital (MA), RRE Ventures (NY), Vulcan Capital (WA), DFJ ePlanet Ventures (CA), New Atlantic Ventures (VA and MA), and WestLB Mellon Asset Management (Germany).  Since 2008, Ember has raised an estimated $99 million in VC funding.

 

MMV Financial made a US$3.0 million venture loan to New York-based CorrectNet, which provides data aggregation and reporting applications to the asset management industry.  CorrectNet is backed by NewSpring Capital (PA) and Edison Venture Fund (NJ).

 

MMV Financial also announced a US$3.0 million investment in California-based Laszlo Systems.  The company has developed a platform that unifies access to internet applications.  It previously raised a reported $32.9 million from WI Harper Group (CA), General Catalyst Partners (MA), Sofinnova Partners (CA), and Mitsui Ventures (NY).

 

 

Fund News – December 2009

 

Tandem Expansion reported the initial closing of its first fund.  The firm is targeting $300 million and intends to invest in growing technology companies.

 

 

Fund News – January 2010

 

Onex Corporation (TSX: OCX) has reached its target of $3.5 billion for its latest fund, Onex Partners III.  The money will be invested alongside US$800 million of the firm’s own capital.

 

Capital régional et coopératif Desjardins and the Caisse de dépôt et placement du Québec established a $600 million fund to support SME in Québec.  The money will be invested over the course of the next three years.

 

 

IPOs – December 2009

 

Mitel Networks Corporation, an Ontario-based company that provides telecommunication services to small and medium sized businesses, filed a prospectus with the SEC for an IPO of up to $230 million.

 

T-Ray Science, a Vancouver-based developer of cancer detectors, completed a $1.5 million IPO on the TSX Venture.

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