It is important for venture capital funds to attract relatively large funds. In fact, the smaller venture capital funds do not perform as well as the more substantive ones. The more substantive Canadian funds are comparable to small American funds, but for Canada, $100 million is significant. Why? Because it allows the management team to spread the risk and support businesses that are performing well in order to achieve a better profitability ratio over time.
Attracting talent is the added value, besides money, that we offer to businesses. When it comes to our VCs, when there is an investment of $5 million, $10 million, $15 million, or $20 million into a $100-million fund, the added value resides in the fact that they can attract more funds and reach a high enough amount to do an initial closing and start to make investments.
As for me, I strongly support the VCAP program. I think that it is a very good idea. However, it is clear in my mind that it is up to the entrepreneur to make sure that that money generates a return. For example, iNovia closed out Fund II in December 2011. Since then, we have made 17 investments in Canadian businesses. It is important to be able to act relatively quickly.