WATERLOO REGION — During the past 16 months, about $3.6 billion was invested in Communitech-member startups and companies, says Chris Albinson, the innovation hub’s chief executive officer.
The amount of investment is running ahead of the provincial and national trends. And now, Communitech can track investments in startups and tech companies across the country in real time.
The innovation hub marked its 25th anniversary Thursday, and announced it had acquired Briefed.in, a startup that was founded a little more than a year ago to track where venture capital is flowing.
Briefed.in was founded by Rob Darling (Darling North Ventures), John Clark (Just1Registry) and Raymond Luk (Hockeystick, Flow Ventures). It is branded as the only public, independent record dedicated to Canadian startups and venture capital.
That information will be as valuable to Communitech as the cockpit instruments are to the pilots of high speed planes, said Albinson.
“We can tell who is investing and at what stage,” said Albinson.
The acquisition is about making data-driven decisions to help startups grow. With that timely information Communitech can spot opportunities and problems much more quickly.
If there is a really interesting med-tech company that is ready for investors, Communitech can see who is putting funds into that sector. It helps to connect startups with the right investors.
“Before we had Briefed.in we couldn’t tell them: ‘Hey, these are the three investors who have invested in early-stage med-tech companies in the last six months, and they are probably really good people to talk to,’” said Albinson.
If the data shows that most or all of the investment is flowing to early-stage companies, Communitech can double down on the search for late-stage investors.
Economists predict a recession early next year, and the data from Briefed.in will help during the slow down.
If a venture capital firm has invested half its funds, and it’s not sure about the impact of the recession, it might invest in a smaller number of companies and keep some reserves on hand to help the companies it has already invested in.
Or, if a firm is having trouble raising enough investment for a new fund, it may use reserves to make investments over a longer period.
“The effect for venture firms is they slow down their investment pace,” said Albinson. “And that means fewer dollars for founders.”
So far the slowing economy has hurt e-commerce companies, such as Shopify, and cryptocurrency startups, he added.
“In other sectors we are seeing continued strength, like enterprise software, it is actually holding up really well,” said Albinson.
Some venture funds specialize in certain areas of tech, and if Communitech sees they are not investing any more or at the same pace, they can provide extra support for its startups in that sector.
Communitech’s fiscal year began in April, and more than $700 million was invested in its startups during the first half of fiscal 2022.
TORONTO – Canada’s main stock index was down more than 200 points in late-morning trading, weighed down by losses in the technology, base metal and energy sectors, while U.S. stock markets also fell.
The S&P/TSX composite index was down 239.24 points at 22,749.04.
In New York, the Dow Jones industrial average was down 312.36 points at 40,443.39. The S&P 500 index was down 80.94 points at 5,422.47, while the Nasdaq composite was down 380.17 points at 16,747.49.
The Canadian dollar traded for 73.80 cents US compared with 74.00 cents US on Thursday.
The October crude oil contract was down US$1.07 at US$68.08 per barrel and the October natural gas contract was up less than a penny at US$2.26 per mmBTU.
The December gold contract was down US$2.10 at US$2,541.00 an ounce and the December copper contract was down four cents at US$4.10 a pound.
This report by The Canadian Press was first published Sept. 6, 2024.
TORONTO – Canada’s main stock index was up more than 150 points in late-morning trading, helped by strength in technology, financial and energy stocks, while U.S. stock markets also pushed higher.
The S&P/TSX composite index was up 171.41 points at 23,298.39.
In New York, the Dow Jones industrial average was up 278.37 points at 41,369.79. The S&P 500 index was up 38.17 points at 5,630.35, while the Nasdaq composite was up 177.15 points at 17,733.18.
The Canadian dollar traded for 74.19 cents US compared with 74.23 cents US on Wednesday.
The October crude oil contract was up US$1.75 at US$76.27 per barrel and the October natural gas contract was up less than a penny at US$2.10 per mmBTU.
The December gold contract was up US$18.70 at US$2,556.50 an ounce and the December copper contract was down less than a penny at US$4.22 a pound.
This report by The Canadian Press was first published Aug. 29, 2024.
The crypto market has recently experienced a significant downturn, mirroring broader risk asset sell-offs. Over the past week, Bitcoin’s price dropped by 24%, reaching $53,000, while Ethereum plummeted nearly a third to $2,340. Major altcoins also suffered, with Cardano down 27.7%, Solana 36.2%, Dogecoin 34.6%, XRP 23.1%, Shiba Inu 30.1%, and BNB 25.7%.
The severe downturn in the crypto market appears to be part of a broader flight to safety, triggered by disappointing economic data. A worse-than-expected unemployment report on Friday marked the beginning of a technical recession, as defined by the Sahm Rule. This rule identifies a recession when the three-month average unemployment rate rises by at least half a percentage point from its lowest point in the past year.
Friday’s figures met this threshold, signaling an abrupt economic downshift. Consequently, investors sought safer assets, leading to declines in major stock indices: the S&P 500 dropped 2%, the Nasdaq 2.5%, and the Dow 1.5%. This trend continued into Monday with further sell-offs overseas.
The crypto market’s rapid decline raises questions about its role as either a speculative asset or a hedge against inflation and recession. Despite hopes that crypto could act as a risk hedge, the recent crash suggests it remains a speculative investment.
Since the downturn, the crypto market has seen its largest three-day sell-off in nearly a year, losing over $500 billion in market value. According to CoinGlass data, this bloodbath wiped out more than $1 billion in leveraged positions within the last 24 hours, including $365 million in Bitcoin and $348 million in Ether.
Khushboo Khullar of Lightning Ventures, speaking to Bloomberg, argued that the crypto sell-off is part of a broader liquidity panic as traders rush to cover margin calls. Khullar views this as a temporary sell-off, presenting a potential buying opportunity.
Josh Gilbert, an eToro market analyst, supports Khullar’s perspective, suggesting that the expected Federal Reserve rate cuts could benefit crypto assets. “Crypto assets have sold off, but many investors will see an opportunity. We see Federal Reserve rate cuts, which are now likely to come sharper than expected, as hugely positive for crypto assets,” Gilbert told Coindesk.
Despite the recent volatility, crypto continues to make strides toward mainstream acceptance. Notably, Morgan Stanley will allow its advisors to offer Bitcoin ETFs starting Wednesday. This follows more than half a year after the introduction of the first Bitcoin ETF. The investment bank will enable over 15,000 of its financial advisors to sell BlackRock’s IBIT and Fidelity’s FBTC. This move is seen as a significant step toward the “mainstreamization” of crypto, given the lengthy regulatory and company processes in major investment banks.
The recent crypto market downturn highlights its volatility and the broader economic concerns affecting all risk assets. While some analysts see the current situation as a temporary sell-off and a buying opportunity, others caution against the speculative nature of crypto. As the market evolves, its role as a mainstream alternative asset continues to grow, marked by increasing institutional acceptance and new investment opportunities.
