Want an investor that cares about impact and returns? Look beyond the fund’s name.

Posted by Accelerate Fund | December 1, 2023

The good news for Alberta tech business founders is that sources of funding have multiplied. There are now sector specific funds like for cleantech or agtech, as well as mission-driven funds and investors with a women or diversity focus.

With more choice though, selection becomes trickier. Who’s the right funding partner for your business, team and goals especially if your values and desire for impact are as important to you as your ambition to grow? 

What if your focus is on the triple bottom line of profit, planet, and people?

Our perspective: there’s not enough hearty conversation about responsible investment in venture capital yet in Alberta. Founders deserve to know more about where potential investors stand. And finding that out isn’t as easy as looking at a fund’s name or their marketing which can start to all sound the same. 

Sizing up the right investor takes a deeper assessment of their network, expertise, and capital.  

Does the investor you’re considering behave with aligned purpose and integrity even if their focus is more about a specific type of technology than impact itself? Which partner will best serve your unique team and goals?

How to evaluate potential funding partners

Every team looking for financing to startup or scale will do some evaluation of funders based on what they say on their websites, on LinkedIn, or at the podium at events. That’s useful, but it’s talk, not walk.

You need to take the initiative to dig in deeper to see how a fund really behaves, how it benefits its founders, how they’ve delivered on the network, expertise and capital fronts. Here are some places you’ll find clues. Don’t be afraid to look under the hood.

Some key things to evaluate:

(you can do this background research without asking permission from the investors)

  • Who’s on the investors’ team? Look at some of those individuals, what’s their expertise and track record? Who are they connected with?
  • How have businesses like yours done with backing from the investor? Did they grow, get follow-on capital?
  • Ask other founders who have chosen the investors – did they get valuable advice and introductions to key people or partners? 
  • What resources and tools can they provide to help you understand ESG impact?

How Accelerate Fund walks the talk on investing responsibly

Accelerate Fund II and Accelerate Fund III are managed by Yaletown Partners, a firm that’s actively working on how diversity and social responsibility play a role in our investments. 

Responsible investing principles form the foundation upon which we ensure that returns and investment decisions are driven by a commitment to people and the planet. 

What’s that look like in terms of how we seek to attract technology businesses for investment? 

While we remain true to our thesis of investing in private Alberta-headquartered businesses, with at least half of staff here and with select types of technologies – team diversity, sustainability and social impact are always on our radar as we scout promising companies. 

We want to invest in and help build strong, profitable businesses with good product market fit, and we know diverse teams do that well. It’s not just about the CEO, it’s about how different perspectives on the leadership team arrive at good decisions and smart business moves.

Ways we find great companies are through Alberta Female Founders, Funders and Fortifiers (ABF4) where we help organize events and speakers, and a wide range of startup communities across Calgary and Edmonton such as the TELUS Community Safety & Wellness Accelerator (CSW), BBVA pitch competitions, Foresight Canada, C-tribe and Innovate Calgary Social Innovation Hub.

While we focus on startups that transform traditional industries, create operational efficiencies and enhance sustainability such as reducing emissions, we also evaluate businesses with input from our own team (read more about our perspectives).

Accelerate Fund III team

Among our investments, some of the impact-driven and diverse teams include Virtual Gurus, Areto Labs, Helicm, True Angle, Synatra, PayShepherd, Arolytics, Ambyint and WaitWell. You’re welcome to reach out to these teams and ask how we’re supporting them.

How will you scale your impact?

Something new we’re offering teams that we back is education around impact reporting – what to focus on, at what stage of the business, to grow wisely. Done well this can be an advantage in recruitment, attraction of capital, and equip you to be ready for future governance reporting.

The earlier we can help founders and teams map out the core strengths of their business not just financial, but broadly what matters including social and environmental impact – that shows the potential risks and rewards in their business model. When you do that thinking up front – identifying metrics that might be fundamental to track early – it’s much easier than trying to fix your impact in retrospect. You want your impact to scale.

We’re early on the responsible investing maturity curve, but making progress

The venture capital and investment industry has just begun to figure out social responsibility and sustainability but more and more investors see the negative financial consequences of not considering ESG impact. 

Alongside the full Yaletown team, we’re watching industry leaders in impact investment for best practices, keeping tabs on evolving thinking about governance regulation internationally, and listening to the companies we support for what they want and need. While our work has just begun, we’re encouraged that other industries have been where investors are today and gotten to inspiring places.

Think about green building – once construction and development had a tiny budget line item for green building materials. Now it’s a whole industry. Or look at capital markets, how massive investment vehicles have shifted away from high emissions to lower emissions sectors. 

Consider the increasing diversity of businesses starting up in Alberta because there’s more support and financing available than ever. Things take time, but we’re moving in the right direction.

About the authors

Accelerate Fund team Melania-Antoszko Investment Analyst

Melania AntoszkoInvestment Analyst, Accelerate Fund II & III, Yaletown Partners

Melania is a committed champion of Alberta’s startup community working as an investment analyst from Calgary. She’s an active committee member with Alberta Female Founders, Fortifiers, and Funders, on the frontline of ABF4 events. Prior to joining Yaletown, Melania was a Venture Fellow with DigitalDX Ventures contributing to fundraising, deal flow data and financial modelling. She also has experience in sustainable fashion and a background in industry research with the Edmonton Economic Development Corporation, and with the Government of Canada analyzing First Nation Economic Development in Alberta.

Arden Tse Investment Manager

Arden TseInvestment Manager, Accelerate Fund II & III, Yaletown Partners

Often seen on startup panels all over Edmonton, Arden is a passionate coach and contributes over 15 years of private and public sector experience. Throughout his career, Arden has focused on discovering and managing value. As an investment analyst with AIMCo, Arden took part in active oversight of environmental, social, and governance issues that impact AIMCo’s then $70B portfolio of assets, as well as underwriting over $1B CAD in real estate transactions. Prior to that, Arden was in commercial leasing and sales with Barclay Street and Torode Realty. Arden joined the Accelerate Fund team to manage Fund II and now manages Fund III. Prior to Accelerate Fund, Arden was Manager of the University of Alberta’s Venture Mentoring Service where he oversaw entrepreneurship development. 

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