If you’re looking for validation about the good things happening within the Canadian startup landscape, it might be the growing number of U.S. investors coming north of the border.
The latest “evidence” is the $15-million raised by Ottawa-based Shopify from Bessemer Venture Partners, FirstMark Capital, Felicis Ventures and Georgian Partners. It is a major financing for a company that has become one of the fast-growing e-commerce players, even though it might not have a huge profile outside of its hometown.
The financing for Shopify, which offers an ecommerce software platform financing came on the heels of Wave Accounting raising $5-million from a group that included Charles River Ventures; WattPad raising $3.5-million in a deal led by Union Square Ventures, and Achievers.com pulling in $24.5-million from Sequoia.
The growing involvement of U.S. investors can only be seen as a good thing because there is still a lack of startup capital in Canada. This is particularly necessary for startups looking for raise anything more than $5-million given there are few Canadian VCs able or willing to make this large of an investment.
The other reason more U.S. investors will be looking for deals north of the border is lower valuations. The U.S. startup market is frothy (bubble-like?) so Canadian start-ups may be more affordable and, at the same time, provide solid investment opportunities.
The only cloud I can see on the horizon is the health of the global economy, which doesn’t seem to be having an impact on startups raising money.
For more, StartupNorth has a round-up of the U.S. deals.