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Today: May 16, 2024
January 6, 2024
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nullAlberta’s High-Tech Investment Soars with Megadeals, While Startups Struggle”

TLDR:

  • Alberta’s tech sector experienced a strong year of venture capital and private equity investment in 2023, almost matching the record levels seen in 2022.
  • Investment in megadeals valued at $100 million or more contributed to the overall investment figures in the province.
  • However, appetite for early-stage startups remained weaker, with many Alberta-based companies struggling to secure the funding necessary to attract larger investors.

Alberta’s tech sector saw significant growth in venture capital and private equity investment in 2023, with early numbers indicating that the province is close to matching the record levels seen in the previous year. Alberta posted approximately $1.17 billion in investment, a figure that closely aligns with the $1.2 billion invested in 2022. This growth comes at a time when many other tech hubs are experiencing lower investment levels compared to the mid-pandemic highs.

However, while investment in megadeals valued at $100 million or more has been strong, early-stage startups in Alberta have struggled to attract investment. Unlike more mature tech markets like Toronto and Montreal, which have investors for every stage of a company’s growth, Alberta’s early-stage startups have found it difficult to secure funding. The president and CEO of Platform Calgary, Terry Rock, comments that even though venture capital investment may be reaching record levels, it doesn’t necessarily indicate growth across all stages of the ecosystem.

Investors in the sector have become more discerning, expecting higher levels of proof and evidence of business success from early-stage companies seeking investment. However, this has led to a leaner and more investable tech sector, as companies have adapted to survive in the current market.

Alberta’s tech sector may experience periods of fluctuating investment levels in the coming years, with major deals accounting for a significant portion of overall investment. The hope is that as the sector continues to mature, the variance in investment levels will reduce. Additionally, efforts are being made to improve connections between investors and tech startups in Alberta, with the launch of an “investor hub” designed to bring in traditional oil and gas and real estate investors.

In summary, while Alberta’s tech sector has experienced a strong year of investment overall, there are still challenges to address, particularly when it comes to supporting early-stage startups and securing funding for companies at the beginning of their growth journeys.

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