Just last week at Collision, North America's fastest-growing tech conference, ventureLAB’s Chief Operating Officer, Matt Skynner, and VP of Founder Success, Sepehr Assadian, announced the exciting launch of the Hardware Angel Network (HAN) at the York Region pavilion. The goal of the network is to catalyze investment in the Canadian hardware and deep-tech sectors by connecting investors and startups in the ecosystem and providing opportunities for mutually beneficial partnerships. These may include syndication of deals, due diligence and technology validation via our state-of-the art Hardware Catalyst Initiative lab to de-risk and support early-stage investment in Canadian companies throughout the national ecosystem.
The announcement was followed by an exciting panel discussion on ‘Meeting the Challenges of Deep-Tech Investing in Canada’, where moderator Matt Skynner was joined by cutting-edge tech investors Raymond Chik, Julia Elvidge, Co-Founder of SheBoot and Claudio Rojas, CEO of NACO Canada.
The panel was kicked off by Raymond Chik, a deep tech founder himself with a passion for chip and hardware design. He described the difficulties he experienced first-hand in accessing funding as a tech founder, particularly in Canada, where there can be gaps in knowledge amongst investors when it comes to areas such as semiconductor technology. Chik identified a ‘capital gap’, particularly in the pre-seed and the seed stage, when products are still in early stages of development.
In addition, Elvidge discussed the importance of patents and the lack of knowledge of patents in the Canadian hardware realm. As an angel investor with a hardware background, she shared the critical role that a network such as the Hardware Angel Network can play in educating investors of the competitive advantage generated by IP. The panelists continued to discuss the critical role of patent protection, with the question ‘is this patentable?’ acting as a key one from both the perspective of a deep tech founder and an investor. Rojas, CEO of NACO and angel investor, highlighted the value of the patent as an ‘economic moat’, with software being disrupted much faster than hardware, which can be protected by IP over time.
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The conversation then turned towards the importance of inclusivity, with Elvidge commenting on a recent NACO report stating that 37% of Canadian investors are now females - a jump from 21% in 2021 - and how important it is to keep this trend growing, particularly in deep tech, where less investors and founders tend to be women. Elvidge later pointed out that female investors typically tend to prefer impact investments and so it is crucial to involve them in deep tech investing, particularly in high-impact areas such as cleantech. Fortunately, the Hardware Angel Network has been launched with inclusivity at its forefront, aiming to bring together a wide variety of investors from various backgrounds dedicated towards the hardware and deep tech sectors.
"37% of Canadian investors are now females - a jump from 21% in 2021"
Rojas also voiced his support for the initiative, framing it as “cutting-edge for the angel community”. He further highlighted the high frictions that can come with raising capital in these complex sectors and the ways that HAN could address them through the community. Both he and Elvidge echoed Chik’s sentiment that deep-tech fundraising was particularly difficult to achieve in Canada and this network would be key for overcoming current challenges.
The panelists continued to discuss the networking aspect around this initiative, which heavily promotes collaboration and shared due diligence amongst investors, enabling them to pool their resources and maximize the impact of their investments.All three panelists were particularly supportive of these benefits of the network, with Elvidge highlighting the importance of understanding the different strengths of the investor members and learning from the discussions that may arise. Chik and Rojas elaborated further by discussing the importance of mentorship opportunities, where experienced hardware investors might be able to support other investors as well as start-up founders in moving forward through the complex technical landscape associated with hardware and deep tech.
Moreover, Skynner pointed out that, according to statistics from the International Data Corporation and from venture investors Gartner and Snowcloud Capital, hardware will constitute 60% of technology revenue over the next five years, but has received only 10% of venture investment over the previous five.
In addition to the network, the panelists shared their excitement on member access to ventureLAB’s state-of-the art Hardware Catalyst Initiative lab to validate early technology and de-risk investment opportunities, because as Chik commented “all hardware start-ups need a lab - this helps a start-up a lot because without the lab, you are nothing”.
To close, the panelists emphasized the importance of deep-tech investments in Canada and encouraged the audience to get involved with the Hardware Angel Network to play a role in supporting transformative hardware and deep tech in Canada.
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About ventureLAB
ventureLAB is a leading global founder community for hardware technology and enterprise software companies in Canada. ventureLAB’s initiatives focused on raising capital, talent retention, commercializing technology and IP, and customer acquisition have enabled thousands of companies to create over 5,000 jobs and raise more than $340 million in investment capital. At ventureLAB, we grow globally competitive tech titans that build-to-scale in Canada, for global markets.
About Hardware Angel Network
At the Hardware Angel Network, we are improving access to capital for Canadian deep-tech and hardware companies by bringing together a community of aligned investors. We are creating the largest community of hardware and deep-tech investors in Canada.
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