Silicon Valley Bank is setting up shop in Canada in aim to

first_img Reddit Featured Stories ← Previous Next → advertisement Comment Silicon Valley Bank is setting up shop in Canada in aim to support country’s thriving tech scene Silicon Valley Bank plans to hire more than a dozen bankers in Canada with the goal of eventually banking 40 per cent of the country’s tech and life science companies Share this storySilicon Valley Bank is setting up shop in Canada in aim to support country’s thriving tech scene Tumblr Pinterest Google+ LinkedIn The headquarters of the Silicon Valley Bank in Santa Clara, Calif.Handout/Silicon Valley Bank/The Canadian Press May 15, 201810:19 AM EDT Filed under News FP Street Facebook Twitter Canada’s tech scene is heating up, and one of Silicon Valley’s oldest financial institutions wants a piece.Silicon Valley Bank, the 35-year-old lender focused on tech startups and venture capital firms, plans to hire more than a dozen bankers in Canada with the goal of eventually banking 40 per cent of the country’s tech and life science companies. It’s received authorization from Canada’s finance minister to open and is waiting on final regulatory approvals to begin lending.Canada’s tech scene is thriving. Startups are proliferating, fuelled by increased local investment and the presence of big-name U.S. venture firms like Andreessen Horowitz and Sequoia Capital. Internet giants including Inc. and Google are hiring thousands of engineers in Vancouver and Toronto and home-grown success stories like Shopify Inc. are taking off.With all that activity comes opportunity for banks willing to lend to small, unproven startups, said Barbara Dirks, Silicon Valley Bank’s recent hired head of Canada.Finally, a free open-source database for all Canadian startup informationThe huge job opportunity in Canadian tech (that no one is talking about)Your next chapter: How to get your startup in front of a decision-makerCanadian banks have a long-standing and concrete view of risk that might make it difficult for them to dive into earlier-stage tech, said Dirks, a veteran of Bank of Montreal and Royal Bank of Canada. Silicon Valley Bank brings a unique understanding of tech and the web of relationships in Silicon Valley and around the world to get startup investing right, she said.Risk Appetite“We’ve been in the space for so long, so something which may look risky to one institution is right in our expertise,” Dirks said.At least one of those Canadian banks might beg to differ. Canadian Imperial Bank of Commerce has trumpeted its own interest in the tech scene, recently buying tech-focused lender Wellington Financial and putting its CEO Mark McQueen in charge of a new “innovation banking” division. While Silicon Valley Bank will initially only have permission to give loans, CIBC’s unit is already licensed to offer a full range of banking services in Canada.Silicon Valley Bank won’t be starting from scratch though. It already helps hundreds of Canadian companies including Shopify, Drop Technologies Inc. and Lightspeed POS Inc. with their U.S. banking, Dirks said. The goal now is to catch Canadian companies earlier and compete for deals directly. The bank will be focused on loans from as small as US$750,000, all the way to leading syndicates of hundreds of millions of dollars, said Mark Gallagher, senior market manager for the U.S. northeast and Canada.Global ConnectionsGallagher has led a team for years that’s helped Canadian tech companies bank in the U.S., but watching the activity of the last few years, he said he knew it was time to step up Silicon Valley Bank’s presence north of the border.“The broad diaspora of Canadians both in the U.S. and that have returned from the U.S. that have experience scaling companies is very strong,” Gallagher said. Venture capital investment reached about$3.8 billion in 2017, up from $3.2 billion the year before, according to the Canadian Venture Capital & Private Equity Association.Canadian companies that want to compete globally generally need to expand outside of their home market quickly. Shopify, the country’s best-known success story since BlackBerry, gets the vast majority of its revenue from outside of Canada. Linking companies up to partners and investors around the world is a major part of what gives Silicon Valley Bank a competitive edge, Dirks said.Serious Swagger“We connect companies between Canada and Silicon Valley, Silicon Valley and New York, Israel, China, etc.,” she said. “That will be one of the things that we’ll be able to contribute to the ecosystem.”It’s a stereotype in Canadian tech that the country’s entrepreneurs aren’t ambitious enough, and that they sell their companies to U.S. owners before pushing them as far as they can go. Just last week, Prime Minister Justin Trudeau, who has marketed his government as a major supporter of the industry, said Canadians need more “swagger” when promoting domestic tech successes.They already have it, Gallagher said.“The level of confidence in the entrepreneurs in Canada today is off the charts compared to what it would have been eight or 10 years ago,” he said. “There’s this inner confidence or strut that we’ve witnessed.” Gerrit De Vynck What you need to know about passing the family cottage to the next generation Recommended For YouBeyond Meat’s forecast sends 2019’s IPO darling to new heightsDavid Rosenberg: Deflation is still the No. 1 threat to global economic stability — and central banks know itTrans Mountain construction work can go ahead as National Energy Board re-validates permitsBank of Canada drops mortgage stress test rate for first time since 2016The storm is coming and investors need a financial ark to see them through 0 Comments More Email Sponsored By: Bloomberg News Join the conversation →last_img

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