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Canada Needs a Peter Thiel

If you’ve spent any time around the burgeoning DemoCamp, CaseCamp, BarCamp, mesh, et al scene in Toronto, one thing becomes obvious: there’s a lot of hard-working entrepreneurs desperately seeking a little venture capital.

These are people who have ideas and/or online services – some of them interesting – but aren’t able to commit themselves full-time and take their start-ups to the next level without an investment from a VC or angels. We’re talking $250,000 to $500,000 – enough to hire a few employees to give it a real go for a year, maybe 18 months provided you’re smart and careful with your cash.

Unfortunately, there’s not a lot of this kind of money floating around even for the best ideas. It’s too bad because just a little VC love would go a long way in boosting Canada’s online landscape.

What Canada needs is Peter Thiel, who co-founded PayPal and one of Facebook’s early investors. Or perhaps someone like Thiel, who has created a new fund that invests a little money (a few hundred thousand dollars) for a small stake (5% to 10%). For more, check out this story in the Wall St. Journal.

If you had a start-up fund with, let’s say, $50-million, you could easily finance 25 companies – provided you could syndicate your post-seed deals. While Thiel takes a hands-off approach, a smart start-up fund should probably offer value-added resources such as infrastructure, human resources, legal services, strategic advisors, etc. given there isn’t a large base of successful Canadian entrepreneurs who have been there and done that.

So where’s this money going to come from? Maybe someone like Research in Motion’s Jim Balsillie, a dyed-in-the-wool entrepreneur. Or perhaps Jeff Skoll, who has been putting his eBay dollars into the film, and social entrepreneurship through his foundation. Or maybe a group of well-heeled entrepreneurs will get together to do something. (Note: Extreme Venture Partners launched earlier this month with a $10-million fund that will focus on $1-million investments.)

In any event, there’s a need that isn’t being met right now. Let’s hope 2008 sees something change.

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