Q-News

September 2008

Trailing 12-Month Charts don't Lie

Posted in Mike's Commentary

September turned out to be a “relatively” strong month in terms of dollars invested.  In fact, not since September of 2007 have we seen as much invested in Canadian private companies in a month.  Looking at the accompanying chart one might begin to think that investment in Canadian private companies is beginning to trend positively but that is not the case.  Looking at our trailing 12-month chart we can see that the number of transactions reported during the past year has not changed appreciably since June 2007 while the amount invested during the trailing period has not made any significant gains since January 2007.  I guess the best that can be said at this point is that the decline appears to have flattened out and we are in a sideways pattern.  It’s sad to see that the number of companies receiving capital over a 12-month period has decline by over 50% since December 2005.  Meanwhile, larger transactions involving later stage companies are the play of the day.

 

 

On the positive side, it is encouraging to see ongoing foreign investment in Canada with California-based Canaan Partners and D.E. Shaw Ventures investing cross continent in Ontario companies and Massachusetts-based Flybridge Capital Partners, Commonwealth Capital Ventures and TA Associates also investing in Toronto and Montreal-based companies.

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