StartupNorth

Tag: Venture Capital

  • Rogers Ventures

    rogers-logo So what’s the story with Rogers Ventures?

    Mic Berman announced StartupCampWaterloo(Serious Edition) happening on October 20, 2009 in Waterloo, ON. Jesse Rodgers provided a little more detail about the event on the BarCampWaterloo Google Group:

    “Rogers Ventures has started an early stage/seed round investment group. They are looking to make several investments before the end of this year and they have  a strong commitment to fund and support entrepreneurs or post doc researchers who have great ideas and/or innovative technology.

    If are looking for funding and would like to pitch the Rogers’ team (Mike Lee, Nyla Ahmad or Jason Zan) and a few other local funders such as Tech Capital.”

    We’ve worked with Mike Lee to host DemoCamp Toronto 21 & 22 (an Evening with Yossi Vardi). Rogers Ventures has already demonstrated their ability and willingness to engage with the community. Rogers Ventures continues to reach out and engage with entrepreneurs across the country.

    Press Release

    Rogers Ventures publically launches on October 15, 2009. Here are the details provided by the consultants and public relations individuals helping Rogers Ventures engage the development community. 

    What is Rogers Ventures?

    Rogers Ventures is a new source of early stage seed level investment for technology start-ups. We find great talent with powerful ideas and we invest in their business success. We invest our money, leverage, experience and other strategic contributions to get our portfolio companies on the path of accelerated development and market growth.  Another part of the Rogers Ventures’ mandate is supporting the innovation ecosystem by providing direct funding to community programs that help create innovation momentum in this country. 

    Is Rogers Ventures a venture capital firm?

    We operate a venture-style funding mechanism (we approve investments on a case-by-case basis) but that’s where the similarities end. Our long-term objective is to develop a portfolio of high potential companies that capture the value created through wireline and wireless broadband networks. 

    Why was Rogers Ventures created?

    We’re living at a time when technology innovation, new online services and shifts in consumer behaviour are being adopted faster than any other time in history. We want to be part of this innovation and the opportunity presenting themselves but realize that we cannot achieve success, as effectively, on our own. Rogers Ventures is our way of looking beyond the walls of Rogers for outside talent and ideas to fund. We believe that this will broaden our innovation horizons and keep us closer to the forefront of next-generation technology. 

    How will Rogers Ventures support the high-tech community?

    While we see a significant amount of energy and activity within the Canadian innovation landscape, we feel that there are opportunities for support for the Canadian ecosystem to accelerate momentum. We have been working to identify community-level programs or initiatives that require support – either money, a space large enough to hold events, someone to pay for pizza, participation in mentorship, contribution as a speaker, whatever – and we try to make that support happen. We know that our effort is not the total solution. We are contributing our part to build the necessary momentum and are committed to engage.

    Who runs Rogers Ventures?

    Melinda Rogers, senior vice-president, strategy and development with Rogers Communications, is the executive in charge of Rogers Ventures. On a day-to-day basis, the portfolio is run by Mike Lee, vice-president with Rogers Ventures, and Nyla Ahmad, vice-president, Rogers Ventures Operations.

    What are Rogers Ventures portfolio companies?

    There are currently three companies within the Rogers Ventures portfolio: Zoocasa,  a vertical search product focused on real estate; Thoora, a next generation news discovery service; and GridCentric, a solution for grid computing. We don’t discuss publically investment levels.

    Is Rogers Ventures a part of Rogers Communications?

    Rogers Ventures falls within Rogers’ corporate strategy and development group and it is legally part of Rogers Communications Inc. However, it operates as a separate entity on a day-to-day basis.

    Additional Team Details

    So who are Mike Lee, Nyla Ahmad and Jason Zan and others. We can start to piece together the players from web searches, management profiles of their portfolio companies, and social media tools.

    “Mike Lee, Chief Strategy Officer, Rogers Communications Inc.

    Michael (Mike) Lee is Chief Strategy Officer for Rogers Communications Inc. Mike is responsible for strategy development, new venture development, and strategic partner management for the Rogers Communications’ group of companies which include Rogers Cable, Rogers Wireless and Rogers Media. Previously, he held the role of Vice President, Strategy and Development for Rogers Cable.” Cable Congress 2009

    “Nyla Ahmad, Senior Director, Strategic Partners for Rogers Communications Inc.

    Nyla Ahmad is responsible for overseeing and managing key cross-company relationships. This includes managing the Rogers Yahoo! strategic alliance across the entire Rogers group of companies. Previously within Rogers, Ms. Ahmad held roles within Rogers Cable and the Internet division of Rogers Media. As Senior Director of Electronic Channels for Rogers Cable Communications Inc. she was responsible for the product development, online services strategy and customer experience for Rogers Yahoo! Hi-Speed Internet. As Vice President of Excite Canada, she oversaw the development of consumer online content and services across broadband, narrowband and wireless platforms.” 3rd Annual C-COR Global IP Summit – Executive Interviews

    “Jason Zan, Co-founder and adviser

    Jason was a Sr. Director of Business Development at Rogers Communications Inc. (NYSE:RG), the largest wireless carrier in Canada. Prior to that Jason was Director of Venture Investments at Rogers where he was responsible for managing the company’s private equity investment portfolio. Jason has a HBA from Ivey Business School, University of Western Ontario, Canada.” Tokia > About Management

    The team at Rogers also includes for former PlanetEye CEO Butch Langlois, who announced in Jun3 2009 that he was joining Rogers Ventures. Butch has a strong histo

    ry with Rogers serving as VP, Finance and Corporate Development in the old Rogers New Media group.

    The team has a very strong Rogers flavour. It will be interesting to see if they are able to break free from the corporate culture that tends to lead to “The Innovator’s Dilemma” to identify opportunities. Their current investments in Zoocasa, Thoora and GridCentric show a desire to commercialize research efforts, both Thoora and GridCentric are commercialized out of the University of Toronto projects and teams. Rogers Ventures seems to be making an effort to move beyond their traditional boundaries. 

  • The sky is falling

    “we have a structural problem and this means Canada’s ability to drive innovation will weaken and we will see the overall economy suffer.” – Gregory Smith, President of the CVCA

    The CVCA has released their Q2 2009 Venture Investment data.

    • Venture investment down 42% from 2008. $179M in 2009 compared to $309 at the same point in 2008. This includes a $50M placement from OMERS for PublicMobile, which when removed makes the numbers even worse.
    • Average deal size decreased to $1.9M from $2.9M, this means that Canadian companies have less available resources than US competitors. 

    So it’s bad. Really bad. This is not the first time. It probably won’t be the last time we hear about the troubles of Canadian VCs. Anybody really surprised?

    The VC industry in Canada has been in turmoil for a long period of time. There are regulatory and structural hurdles, which the CVCA is actively lobbying politicians for the support. This includes lobbying for support to SR&ED tax credit programs, offset agreements, incentives for investment, etc. I’m not sure that “establishing a blue chip, limited-life panel comprised of company executives, university presidents and venture capitalists with the express mandate to devise a road map for Canada’s technology industries” will provide the solutions necessary to Canadian entrepreneurs. And while I think that VCs are an important part of the ecosystem to support and nurture entrepreneurs, they are only part of solution. It is the entrepreneurs and startups that will save venture capital in Canada. 

    What does all of this mean?

    • Number of investors will continue to decrease
    • Valuations will continue to decrease
    • Customer uptake will be slower
    • Need to become cash flow positive
    • Acquiring entities will favour profitable companies

    Does this sound familiar? It’s pretty much verbatim out of Sequoia Capital’s R.I.P. Good Times presentation or Ron Conway’s email to his portfolio. This is not new or news to Canadian companies. Raising money has been difficult for a while in Canada. Our investors have preferred later stage investments, in the H1 2009 just over 60% of all of the capital when to later stage deals (Series B and later). We’ve seen a need for companies to be able to demonstrate a product, customers and market potential just to raise early funding.  

    There are Canadian ventures that are growing and successfully operating on revenues. Along with a set of emerging technology ventures that have closed non-traditional funding rounds. Well.ca raised $1.1M from angels. J2Play was acquired by Electronic Arts. It’s possible to raise money, to get acquired, to operate successfully during tough times. You just have to execute better than your competitors.

    So what is an entrepreneur supposed to do?

    1. Read How Startups will save Venture Capital in Canada.
    2. Read R.I.P. Good Times. and Ron Conway’s email to his portfolio.
    3. Stop worrying about the state of Venture Capital in Canada.
    4. Start building real businesses with real customers driving real revenues (if you need to raise money there are other sources of capital).
    5. Look for growth in markets outside of Canada (while this includes the US, it should not be limited to US only growth).
    6. Execute, execute, execute. You’re only as good as your last deal. So find customers, keep them happy, and keep innovating.

  • Hustle ventures

    I’ve been thinking that we need to create a local incubator, and I’ve started to wonder where this fits in Jevon’s vision of saving VCs in Canada. And it’s an easily understood way to go about deploying small amounts of capital and managing the risks associated with the investments. There are folks beginning to do this in Vancouver, and Montreal. They provide entrepreneurs with capital, education, mentorship, promotion mechanism, market development, among other offerings. They are angels, VCs, and others hustling to find deals, to help their portfolio grow and be successful. Most of all we need to lead by example. We need to build real companies like Well.ca, FreshBooks, DayForce, Rypple, PlentyOfFish, ElasticPath, Idee, and others. The focus needs to be, not on raising money, but on finding customers and solving problems for the marketplace. There is money is available to help companies once they’ve found a customer, when they need to do marketing, additional product development, etc.

    The gap that is identified is at the very earliest stage of the investment pipeline. There are less entrepreneurs starting fundable companies. This is because there have been less successful startups that spinout human capital, culture and ideas. The lack of Fairchildren means there are less successful individuals that have earned their pedigree and training at a successful startup. Basically, there is a bunch of stuff that can be best learned by doing it for another startup (success or failure). It’s not only about technology, it’s about finding customers, raising money, building products, doing business development, developing personal and professional networks, learning how to do sales, etc.

    But we’ve had a dearth of these startups? Maybe not, but there has definitely been a dearth of Fairchildren from these companies. Definitely not enough to create a viable, self-sustaining ecosystem of entrepreneurs and angel investors in the technology space. And this has left a gap in the very early-stage entrepreneurs and funding creating early-stage technology ventures. This gap may have longer term repercussions, the most easily identifiable is in the declining number of early stage investment in Ontario.

    Who is motivated to create an environment with early stage deals, educated entrepreneurs and culture of educated risk taking? Who is going to do the hustling to make these ventures happen?