Thrive ETA Fund combines capital, training, and mentorship for women buying firms from retiring business leaders.<\/p>\n
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As a wave of aging Canadian entrepreneurs retire, the Business Development Bank of Canada (BDC<\/a>) has launched a new, $50-million fund aimed at providing women entrepreneurs with the capital and support they need to buy and grow those outgoing leaders\u2019 companies.<\/p>\n \u201cThis is an amazing opportunity to rebalance the equity and ownership between men and women.\u201d<\/p>\n<\/blockquote>\n BDC Capital\u2019s Thrive Entrepreneurship Through Acquisition (ETA) Fund includes $10 million for indirect investments in private equity (PE) funds that finance search funds for women-led business acquisitions. It also offers $40 million for direct equity investments in search funds, management buyouts, or self-funded ETA hunts.\u00a0<\/p>\n The Thrive ETA Fund will include an accelerator aimed at providing women entrepreneurs with the training and mentorship they need to not only source and strike such deals, but also take over and run these companies. The goal is to help more than 60 Canadian women pursue acquisition-based entrepreneurship.<\/p>\n The launch comes as many Canadian entrepreneurs are gearing up to sell, hand off, or shut down their businesses. A 2023 report<\/a> from the Canadian Federation for Independent Business (CFIB) characterized this as a \u201csuccession tsunami.\u201d<\/p>\n The CFIB found that 76 percent of Canada\u2019s small business owners planned to exit over the next decade, three-quarters of them due to retirement. However, the CFIB\u2019s report determined that only one in 10 had a formal succession plan, while the majority said that finding a suitable buyer or successor was the biggest obstacle.<\/p>\n S\u00e9vrine Labelle, managing director of BDC\u2019s Thrive Lab for Women, described this changeover as a \u201conce-in-a-lifetime\u201d chance to foster women entrepreneurship across Canada. In an interview with BetaKit, Labelle highlighted recent analysis by Statistics Canada<\/a> indicating that less than one in five private businesses in Canada are majority women-owned.<\/p>\n \u201cThis is an amazing opportunity to rebalance the equity and ownership between men and women,\u201d Labelle said.<\/p>\n Earlier this summer, BDC launched a separate but similar $100-million joint financing initiative<\/a> with First Nations Bank of Canada (FNBC) geared towards helping Indigenous groups fund ETA deals. Labelle said she thinks ETA and business transitions \u201cwill be at the core\u201d of BDC\u2019s strategy for the next few years.<\/p>\n RELATED: <\/strong>As aging entrepreneurs retire, BDC and FNBC announce $100 million to help Indigenous groups buy their businesses<\/strong><\/a><\/p>\n BDC is an arm\u2019s length Crown corporation wholly owned by the Government of Canada. Its mandate is to support Canadian entrepreneurship, with a focus on small and medium-sized businesses, and operate as a complementary player in the market. The bank provides loans, equity funding through its investment arm BDC Capital, and advisory services to companies and funds across the country.<\/p>\n According to BDC\u2019s latest annual report<\/a>, the bank has directly supported 21,586 women entrepreneurs in Canada and is on track to reach nearly 23,000 by fiscal 2027. The bank has bolstered its support for women in recent years through initiatives like its 2022 commitment of $500 million<\/a> to women-led Canadian startups and funds through BDC Capital\u2019s Thrive platform. Labelle, who joined<\/a> BDC\u2019s Thrive Lab in 2023, said the Thrive ETA Fund is the final \u201cmissing piece\u201d from that envelope.<\/p>\n \u201cOur role is to play where others don\u2019t play yet,\u201d and crowd more capital into the space, Labelle said. \u201cThat\u2019s exactly what we\u2019re doing with the [Thrive] ETA Fund.\u201d<\/p>\n According to Labelle, most Canadian ETA search funds still raise the majority of their capital from United States (US)-based investors. \u201cWe hope to change that,\u201d she said.<\/p>\n\n