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Why Several Top Institutional Investors Backed This Canadian Venture Fund
Caisse de dépôt et placement du Québec is among the latest investors backing a fintech fund from Portag3 Ventures.
A blue-chip list of institutions — including Caisse de dépôt et placement du Québec, CNP Assurances, and Public Sector Pension Investment Board — have invested in Portag3 Ventures’ second financial technology fund that closed Tuesday. With the investment in the fund, the largest of its kind in Canada, the limited partners are also getting a window onto a specialized technology sector.
Portag3 Ventures, the venture capital arm of Sagard Holdings, raised C$427 million ($321 million) for Portag3 Ventures II, its second venture fund focused on early-stage investments in the global fintech industry. Sagard Holdings is an alternative asset manager founded by Power Corporation of Canada.
“There aren’t many funds that are also collaborative and that really link up with their investors,” said James Vance, treasurer for Cincinnati-based Western & Southern Financial Group, an investor in the fund. Among other things, Western & Southern offers life insurance, asset management, wealth management, and financial planning.
“We have the opportunity to meet directly with the fund’s portfolio companies,” Vance said in an interview. Vance explained that Western & Southern is looking to possibly use new software from the companies in the portfolio or even expand on business ideas that may have worked in Canada to the U.S.
[II Deep Dive: Fintech Finance’s Power Players]
He said Portag3 Ventures has held meetings where investors can meet with the management teams running the fund’s portfolio companies. At a recent Toronto conference, Vance met with a number of these companies.
“Since then we’ve set up three meetings with internal management teams to see if we could use what they offer internally,” he said. Vance added that the mutual life insurance company is also interested in co-investments.
“In Toronto, Peter Hancock spoke,” Vance said, referring to the former president and CEO of AIG, who is a senior advisor to the fund’s portfolio companies. “He led many of the discussions about what they intend to build and what doesn’t need to be looked at as well.”
Other investors in the fund include Alterna Savings and Credit Union, Aviva France, BDC Capital, The Co-operators, Eldridge Industries, Green Shield Canada, Harel Insurance & Finance, iA Financial Group, Laurentian Bank, and NSV Wolf Capital.
Power Financial Corporation, IGM Financial and Great-West Lifeco Inc. are anchor investors, dating back to 2016 with the launch of Portag3 Ventures’ Fund I.