Canada: Expansion In Alberta's Startup Funding Ecosystem: University Of Alberta Creates An Innovation Fund Starting At $5M With A Focus In AI, Health, Energy, And Agriculture

The startup ecosystem in Alberta has been growing rapidly since 2019. According to Start Alberta, a digital platform and gathering space for companies, founders, investors, and students, investment in Alberta-based startups has grown from $427 million in 2019, to an astounding $1.2 billion in both of 2022 and 2023. This reflects an expansion of almost 300%, an extremely exciting prospect for the Province of Alberta moving forward. Edmonton and Calgary have both experienced this investment-boom with larger players in both cities such as Edmonton-based software company Jobber, with a $100 million Series D investment in January 2023, and Calgary-based Neo Financial, with a $145 million Series C investment in May 2022.

While the investment landscape is filled with venture capital firms such as Inovia Capital, Plug and Play, and Thin-Air Labs, accelerators such as Innovate Calgary and District Ventures, and various angel investors, a new, Alberta-focused fund has hit the scene: the University of Alberta Innovation Fund (the "Innovation Fund").

Starting with an initial $5 million, the Innovation Fund is projected to be a $50 million fund focused on investments in Artificial Intelligence, Agriculture, Energy, and Health sectors. Further, the Innovation Fund looks to provide successful applicants with a founder and faculty-friendly approach that offers access to initial and follow-on funding in an environment with opportunities for shared learning and access to scale-up and go-to-market support in local and global networks.

The mandate of the Innovation Fund is to invest in early-stage technology ventures with a connection to the University of Alberta, mainly that of undergraduate students, graduate students, faculty, staff, and University of Alberta Alumni. The Innovation Fund is looking for diverse teams and board members that have potential for unconstrained growth in large markets. Finally, the Innovation Fund is focused on ventures that address challenges that will result in positive social impacts; this criterion being a fundamental part of the potential investment's mission and purpose.

The structure of the Innovation Fund is quite unique; a fund fueled by philanthropic donors, governed by an independent Board of Directors that includes the president and vice-chancellor of the University of Alberta, Bill Flanagan, paired with an eager, driven student-led operations team, all headed by CEO Sheetal Mehta Walsh, a veteran not only on the North American entrepreneurial and technology-focused markets, but the global scene as well. Sheetal, a graduate of the University of Alberta herself, brings a vast knowledge portfolio, backstopped with industry experience including previous roles at Microsoft, the United Kingdom's Deal Maker Global Entrepreneur Program, and the Government of Alberta's Ministry for Jobs, Economy, and Innovation, to name only a select few.

Jillian Suess, a part of the Marketing and Communications team and fourth-year Bachelor of Commerce student, shed light on the excitement of working with a fund that is just beginning, stating that, while you are hearing pitches from exciting startups, they are also building their own startup with the Innovation Fund itself. Alexandra Wilson, fourth-year Bachelor of Science student and Deal Flow Specialist, stated that, since the fund began accepting expressions of interest from the public, over 150 different businesses and ideas have been reviewed. She also reiterated that the Innovation Fund is focused on investing in ventures that will bring a positive social impact, and further highlighted the talent and diverse research backgrounds coming out of the University of Alberta.

The dedication to positive social impact can be highlighted by the first official investment of the Innovation Fund, RL Core Technologies; an AI-based technology company that focuses on leveraging artificial intelligence to improve water treatment efficiency, reducing costs, and lowering energy usage. Started by a research team at the University of Alberta,

This partnership highlights the strength of the research at the University of Alberta, with revenue dedicated to research jumping 7.8% in 2022 to $597.4 million – an all-time high. These recent trends align with the University of Alberta's strategic plan for research and innovation, which looks to increase annual sponsored research revenue to $650 million by 2028 and $750 million by 2023. For investors looking for ground-breaking research opportunities in fields such as health, agriculture, AI, and energy, the innovation coming out of the University of Alberta cannot be overlooked.

In looking at the future of the Innovation Fund, Alexandra and the Deal Flow team are spending multiple days meeting and completing due diligence lite with companies at the quickest pace they can, given the unprecedented number of applications. Multiple investments are intended to be made throughout 2024 as they filter through all the interested companies.

With the University of Alberta's dedication to research and innovation to grow in the future, paired with the Innovation Fund's dedication to impact entrepreneurs with a connection to the University of Alberta, the Innovation Fund is poised to help develop strong research ideas into commercially viable, socially positive business in the future. Exciting times are ahead for Alberta's technology industry and the newest venture capital fund, the Innovation Fund.

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