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Railsbank news round-up: Robust Canadian VC market

Week 3: a brief look back at some of the fintech news that’s not always picked up.

Canada’s VC market remains robust with fintech “very hot”

We start this week with news that Canada's venture capital market remains robust.

That was the conclusion of KPMG in Canada. According to its Private Enterprise's quarterly Venture Pulse report, a global analysis of venture funding, Canada's venture capital market crossed the $1bn threshold in the fourth quarter for the second time in a row to finish 2019 at an all-time record of$4.6bn.

"It is really a testament to the growing maturity of Canada's venture capital ecosystem," said Sunil Mistry, partner, KPMG in Canada. "The tech ecosystem in Canada is now more independent and self-sustaining than ever before. I don't anticipate deal activity slowing down anytime soon."

Canadian VC investment totalled $1.17bn in the fourth quarter, up 30 per cent from the year-earlier period and down 34% from a record high of $1.77bn in the third quarter. The number of closed deals were lower at 109, compared to 151 in the previous quarter, but were bigger in size.

The fourth quarter was powered by deals from 1Password, a Toronto-based password manager, Coveo, a Quebec City-based artificial intelligence startup, and Nuvei, a Montreal-based payment processing company.

"The Coveo funding round highlights the strength of Canada's AI innovation ecosystem, which has spread well beyond its traditional innovation hubs of Toronto, Vancouver, Montreal, and Waterloo," added Mistry. "At a sector level, fintech continues to be a dominant area of interest for investors – both from an investment perspective and from an M&A perspective – in part due to the strength of Canada's banking and financial services sectors."

The report was also bullish about the future, with the outlook for VC investment remaining positive. "I don't see much changing going into at least the first half of this year," said Mistry. "A lot of funds already have their next fund monetized. They need to spend the money, and they're looking to stay away from any volatility in the public markets."

The report also said that the US remains the epicenter of VC activity, accounting for more than half of global VC investment in 2019. As 2020 unfolds, deal activity is expected to remain relatively steady, with areas like artificial intelligence, biotech, and fintech remaining very hot.

Asia’s top firms recognised

Back in Singapore and last week Asia’s top firms were recognised at the 2019 Frost & Sullivan Asia-Pacific Best Practices Awards.

Amongst the companies honoured were Union Bank of Philippines, Local Power, Smart Selangor, Turnkey Lender, Medeze, Singtel and NTT.

The recipients of the annual awards were identified following in-depth research conducted by the firm's analysts. The award categories offered each year are carefully reviewed and evaluated to reflect the current market landscape and include new emerging trends.

The nominated companies were then evaluated on a variety of actual market performance indicators which include revenue growth; market share and growth in market share; leadership in product innovation; marketing strategy and business development strategy.

Shivaji Das, Partner & Asia-Pacific Managing Director at Frost & Sullivan said that the award recipients have consistently demonstrated outstanding achievement and superior performance in areas such as leadership, technological innovation, customer service and strategic product development amidst the changing business landscape.

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