Entrepreneurs need to be prepared to partner with investors, know where to go to get funding and understand what investors expect in return.

It also helps for the entrepreneurs to be in a hot niche, such as life sciences or AI, longtime angel investor and WUTIF Capital CEO Mike Volker told Business in Vancouver.

Vancouver’s Miraterra Technologies Corp. is an example of an AI venture that recently had an oversubscribed funding round. Originally set for $13.9 million, the agricultural-technology venture’s funding round provided it with $16 million in March.

Quantum computing is another hot sector. That likely helped Coquitlam-based Photonic Inc. raise $275 million in a financing round that closed May 12—sufficient to give it a $2.7-billion valuation.

“If you’re doing something that really is significant and important, finding capital partners is easier,” Photonic CEO Don Mattrick told BIV.

“We have a compelling technology, a team with technical and commercial expertise and experience, and a strategic partnership with Microsoft to deliver it.”

Stock markets hitting all-time highs helps keep the investment climate vibrant, Volker said.

“When stock markets are buoyant and bullish, people are more inclined to take risks,” he said. “It’s just the attitude that’s prevailing. If markets are gloomy, then people hold back and are more reserved. When things are so positive, people’s attitude is positive.”

High corporate valuations are not always just on paper. They can tangibly translate into more money in investors’ pockets, he added.

That is because investors in boom times can more easily cash in their equity positions in private companies while turning a profit. Companies either get bought or go public, Volker said.

“There doesn’t seem to be any abatement of deals,” he said.

“More angel investors are created on a regular basis when we have exits. We’ve seen some lucrative exits lately, and they create a number of newly minted angel investors who are looking at giving back, in a sense, by investing in early-stage companies.”

He pointed to the 2023 transaction that saw Occidental Petroleum (NYSE:OXY) spend US$1.1 billion to buy Squamish-based Carbon Engineering as a deal that created many new angel investors.

Smaller deals that helped create new angel investors include one in December, when North Carolina’s Prometheus Group bought Vancouver’s Actenum Corp. for an undisclosed amount, Volker said.

“It was a modest payout, but still was good,” Volker said.

“This year, we’ve got General Fusion with its IPO on Nasdaq, and that’s probably going to create more capital.”

Some investors openly admit that strong corporate valuations prompt them to pay prices for equity stakes that may be higher than corporate fundamentals justify.

“Are we making a lot of probably not so great, overvalued investments in companies right now? Yes, definitely,” said Karl Alomar, managing partner at M13 Ventures, on a panel at the Web Summit technology convention in Vancouver on May 12.

“There is a lot of money at work and there are a lot of people, I think, putting money into companies without having the level of diligence that they should be doing.”

Lawyers can also be helpful to gauge vitality in the venture capital market.

Harper Grey LLP associate Ryan Bencic said the climate is “lumpy,” meaning there can be lulls between clients but that work can suddenly ramp up when clients need things done right away.

“It’s definitely busy,” he said. “It can be zero-to-sixty really quickly and then you might go down.”

Landing cash can take patience even in a hot market

Even in a hot venture capital market, obtaining financing can be a challenge because it can take time to forge partnerships.

Many Vancouver investors are patiently vetting potential investee companies, said Sue Paish, CEO of the Vancouver-based Digital supercluster built by the federal government.

That was not always the case, she said.

These investors also often want to be in their investments for five or more years instead of just being in and out to make a quick buck.

“There was a time when the investor market in Vancouver was very frenetic and investments were sometimes not in companies with a view of long-term growth,” Paish said.

“Now, the investor market in Vancouver is very much focused on the long-term growth of the investee company.”

That means that investors are seeking more than just an equity stake, but rather a partnership. The Digital supercluster also forms partnerships but does not take equity stakes. Instead it provides capital at $0.30 on the dollar when the investee company also provides investment capital. In return, Digital stipulates that the technology must remain in Canada, Paish said.

Speaking at Web Summit Vancouver, Alomar said entrepreneurs should similarly be motivated primarily by finding the right partners—ones who have longer-term outlooks, expertise and strategic wisdom.

“Venture capital is not about money,” he said. “If you’re raising venture capital just for the money, you’re not going to get a great partner, and when the chips are down, it’s not going to be the best experience.”

Prior to the pandemic, Richmond-based Ideon Technologies Inc. sought partnerships and was pitching its AI technology, which helps mining companies have a more fulsome map of sub-surfaces.

One of its targets was global mining giant Rio Tinto Ltd. (ASX:RIO).

“Rio said: ‘We are interested in your technology but you should go and prove the efficacy of it with other partners,'” Ideon CEO Gary Agnew told BIV.

Ideon then partnered with BHP Group Ltd. (NYSE:BHP) and others to conduct field trials before going back to Rio Tinto, which then became a customer, Agnew said.

Along the way, Ideon benefitted from the Digital supercluster providing funding.

Digital partnered with Ideon during the pandemic with a $4-million investment contingent on Ideon spending 3.33 times more.

Ideon then in 2024 led a consortium that landed a $16-million Digital supercluster investment spanning three years. Of that $16 million, Ideon received $10 million, Agnew said.

Rio Tinto, meanwhile, continued as Ideon’s customer. In October 2025, it signed a five-year “multimillion-dollar” deal for Ideon’s services, Agnew said. Freeport-McMoRan Inc. (NYSE: FCX) also signed a customer contract last fall, he added.

“The optimal way to fund our business is from customer revenue,” he said.

After that comes government capital, such as what it got from the Digital supercluster, while the third way is through venture capital funding in exchange for an equity stake.

Ideon netted US$15 million in venture capital funding from Silicon Valley-based Playground Global in mid-2022 in exchange for equity, Agnew said. That was part of a US$16-million Series A financing round.

After seed funding, apply for SR&ED tax credits

Options abound for entrepreneurs seeking capital.

Some advice at the outset may be to focus on a clear and small niche, and do it well, and to know your company inside and out so answering questions from potential investors is easy. Those were tips from some B.C. entrepreneurs who have landed substantial amounts of capital: Clio (Themis Solutions Inc.) co-founder Jack Newton and LayerZero Labs Canada Inc. cofounder Bryan Pellegrino.

Another tip is to be able to show where the money is going to be spent, or getting the capital is unlikely.

The first stop for entrepreneurs is often to hit up friends and family for potential financing. That is what Ideon did, Agnew said.

Angel investors come next, he added, noting that Ideon achieved $1.3 million in a financing round in 2020, and then received about $1.8 million in a separate angel-financing round the next year.

Volker has long helped connect early-stage companies with angel investors.

He founded the VANTEC Angel Network in 1999 and it continues to operate with monthly events.

“It’s an open door,” he said. “Those wanting to pitch can apply online, and then there is a screening session,” he said.

Separately, entrepreneurs could apply to pitch at the Angel Forum, which holds events at various intervals. It has also operated for decades.

Once entrepreneurs have money trickling in, the key is to spend it, said Michael Weatherby, a principal at Manning Elliott LLP.

That is because Canadian-owned companies spending money in Canada on projects that advance technology are entitled to Scientific Research and Experimental Development (SR&ED) refundable tax credits.

“SR&ED only becomes relevant when they actually start spending money,” said Weatherby, a SR&ED consultant for the past 20 years.

“To get a dollar out of SR&ED, you’ve got to spend three dollars in Canada 12 to 18 months ahead of time. It’s not free money, but it’s a way to extend your runway.”

His quick math holds that an entrepreneur spending $100,000 on salaries in a SR&ED-eligible project will get $64,000 back.

If the entrepreneur spends a separate $100,000 on B.C. contractors, the B.C. government provides a cheque for $33,000, he said.

Finally, if that startup spends another $100,000, this time on B.C. materials, the entrepreneur would be entitled to $41,500 back, Weatherby said.

Agnew said he was happy to receive some early capital by applying for SR&ED tax credits but he warned that the process is complicated.

The money helped, he said.

“The process to claim the money is unbelievable,” he added. “There’s a whole industry that has been spun up to help companies like Ideon go through the claiming process. We end up giving a bunch of money to the companies that help us figure out how to claim the money.”

Various funds exist to help corporate growth

Volker said his Western Universities Technology Innovation Fund (WUTIF) fund invests solely in B.C.-based companies because one point of the fund is for its investors to be eligible for the B.C. government’s venture capital corporation tax credit.

That program allows investors to get 30 per cent of fund investments back as refundable tax credits.

The 23-year-old fund accepts new investors as long as they are what the BC Securities Commission considers to be “accredited investors,” Volker said.

WUTIF has invested in dozens of early-stage companies in a wide range of sectors. One of its investee companies was Ideon.

Another option for entrepreneurs is the early-stage accelerator New Ventures BC, said Volker, who is a director and past chair of that organization.

New Ventures BC runs a competition where prospective companies provide submissions by March of each year and vie for some of approximately $250,000 in prizes.

The money comes from Innovate BC and sponsors.

“We are seeing record numbers of new companies entering the competition,” Volker said. “This year there are somewhere around 200 companies involved.”

Competing companies go through elimination rounds, which whittles the remaining contestants to 10. Vetting continues until there is a top three, Volker said.

Once a company becomes larger, its executives might vie for some money from an organization such as Digital.

British Columbia Investment Management Corp. has built one of the largest venture capital programs in Canada. It has more than $1 billion in assets under management and has plans to grow.

Sector-specific venture capital firms could be another option. Canadian life sciences investor Amplitude Ventures has invested in Vancouver companies, such as Notch Therapeutics.

Boris Wertz is a founding partner at Version One Ventures, and he has invested in hundreds of companies, including many in B.C.

He said he most looks for two things: a passionate entrepreneur and an emerging niche subsector.

One emerging option for companies that have ties to the province’s largest universities is to apply to funds that the province is setting up with Simon Fraser University and, separately, the University of British Columbia.

B.C. Minister of Jobs and Economic Growth Ravi Kahlon announced the UBC fund in March. The UBC Catalyst Ventures Fund is financed with $10 million coming from the B.C. Crown corporation InBC Investment Corp. and $10 million coming from UBC.

UBC is separately raising a further $20 million with the goal to bring the fund’s total investible capital to $40 million.

At Web Summit Vancouver, Kahlon announced a similar fund for SFU, although it is half the size.

InBC is investing $7.5 million in the SFU fund, with the university matching that total. SFU then plans to raise a further $5 million so the fund can invest $20 million.

“We have a whole bunch of companies in our pipeline,” SFU vice-president of research and innovation Dugan O’Neil told BIV.

“I’m not going to name the specific ones. They have to go through a due diligence process. We have new, young clean-tech companies, life-science companies, deep-tech companies.”

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