Every year, the Did You Know series provides an update on what I’ve been tracking regarding tech financing in the Edmonton region. Last year, around this time, I wrote the second installation which reported $178 million in financing in 2021. That number has since increased to $190 million as I’ve been able to find more publicly available information since last year.
When we look at what’s happening globally, according to Crunchbase, global venture funding declined 35% last year- from a high of $681 billion invested in 2021 to $445 billion in 2022. Similarly, according to McCarthy Tetraultii, fundraising in Canada declined 41% (from 21.8 billion in 2021 to 12.8 billion last year).
It seems that funding raises in the Edmonton region followed this global trend. I tracked a little over $118 million in financing raises in the last 12 months.
Like in previous years, the total $118.48 million identified only represents a fraction of the overall financing that went into Edmonton region companies in 2022.
When we look more broadly at the number of deals, including mergers and acquisitions, sale of shares, crowdfunding, licensing deals and other non-venture capital financial instruments, we were able to track 142 deals (Figure 1.)
Source: Edmonton Global based on various
Of the 67 raises identified in the region in 2022, valuation data could only be found for 54 of those deals (Figure 2).
So, while we know that financing is taking place, we cannot track the precise valuation of those raises.
There are many reasons why companies may choose to keep positive financing news to themselves. Some may wait to announce funding until they have a more mature product or inventory of an existing product. They may also be required to keep the information confidential because of pending partnerships or contracts or because their financier does not wish to disclose how they are allocating their funding dollars to their competitors. In other cases, companies may decide that added attention might be a distraction that will affect their ability to focus on their core business.
This means that the data being shared here provides a part of the story of what is happening – but it does provide a decent snapshot of the overall financing landscape. Over time more information may become public, and I look forward to updating this data as this information is shared.
Looking back on 2022, there is a lot to celebrate. Twenty companies raised more than $1 million each in 2022, and at least eight raised more than $5 million each, including Aurora Hydrogen, Areto Labs, Copperstone, DrugBank, Mdiio, Trust Science and Wyvern – with one of the eight wishing to remain anonymous. In fact, there may be others that we are just not aware of.
In 2022, local companies saw a further ~$1.7 billion in finance (over and above the $118.48 million) from selling shares, crowdfunding, licensing deals and other non-venture capital financial instruments.
Like last year- we also saw companies representing a diversity of economic sectors receive funding. Companies representing every priority sector identified by Edmonton Global received financing from private investors (Figure 3).
Perhaps one of the most interesting stories in 2022 was around mergers and acquisitions – both inbound and outbound. We were able to track 30 acquisitions totalling more than $119.8 million. Notable deals include the purchase of video game studios Inflexion by Chinese multinational Tencent, and Beamdog by US-based Aspyr; as well as the purchase of Petfood leader Champion Petfoods by US headquartered Mars Foods.
Another exciting development was the uptick that occurred within the funding of funds. More than $23 million in funding was raised by locally-based funds including $10 million for ScaleGood Fund, $10 million for Sprout VC and $1.5 million for Startup TNT. We also welcomed new venture-supporting organizations such as Seattle’s Flying Fish Partners and Silicon Valley’s Plug and Play.
While global trends for venture capital raises were somewhat muted in 2022, there was still a lot to celebrate in the Edmonton region. The data shows that the global finance community recognizes the value companies in the Edmonton region are creating. I look forward to continuing to track where these investments lead. If you have any information or data around tech financing that I missed and that could or should be included in this tracking, reach out. I’m always happy to hear about and amplify these positive stories in the region.
If you want to learn more about tech financing in the Edmonton region or want to chat more with me on this topic (or any other topic in my DYK series), reach out using the form below
A life-long champion of the Edmonton region, Jeff believes in the importance of evidence-based decisions that are founded on collaboration, transparency, humility and accuracy. He enjoys looking at maps and pondering the trade-offs between good information now and better information later. His diverse background includes international experience working with academia, private sector, not-for-profits and the public sector. When Jeff is not neck deep in some spreadsheet or research report you can find him exploring local art galleries and music venues – or stopping to smell the wildflowers in the North Saskatchewan river valley.