New Fonds Impulsion will expand support for founders amid declining seed-stage deal flow across the province.<\/p>\n
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Investissement Qu\u00e9bec has officially relaunched a popular early-stage investment program as a $200-million venture capital (VC) fund for the province\u2019s tech startups.\u00a0<\/p>\n
\n\u201cThere are two clear objectives: to build the next generation of flagship technologies, and to fill the gaps in development stages that are a little underserved.\u201d<\/p>\n<\/blockquote>\n
The fund, known as Fonds Impulsion, was created with $150 million already dedicated to Impulsion PME, an early-stage investment matching program that briefly shut down<\/a> last fall. An additional $50 million was allocated from the province\u2019s research and innovation strategy.\u00a0<\/p>\n
The allocation was previously announced in the provincial budget<\/a> in March, but IQ has now launched the fund and provided more details on how it will work.\u00a0<\/p>\n
The fund is targeting pre-seed and seed tech startups across sectors, according to IQ director of early-stage VC Claire Leli\u00e8vre and vice-president of VC Alex Laverdi\u00e8re. In a French-language\u00a0interview BetaKit has translated into English, Laverdi\u00e8re said the fund plans to invest in roughly 70 unique companies over its lifetime. It\u2019s expected to span roughly 10 years with the opportunity for a re-up from the provincial government.\u00a0<\/p>\n
The original initiative, Impulsion PME, launched in 2021 under former provincial minister Pierre Fitzgibbon. It was given an additional $120 million from the province in 2023 as part of Qu\u00e9bec\u2019s five-year innovation strategy<\/a>. The program was created and financially supported by the ministry of the economy, but Investissement Quebec employees managed and delivered the program. In her own French-language interview, Leli\u00e8vre said it deployed roughly $65 million across 67 startups during its operations.\u00a0<\/p>\n
The program was abruptly shuttered in November 2024, leaving several entrepreneurs in the lurch<\/a>. Some told BetaKit they had been counting on the program\u2019s investment-matching mechanism to close their first rounds of financing. The program has now been fully sunsetted in favour of the new Fonds Impulsion fund.\u00a0<\/p>\n
Startups will have to apply and obtain a reference from an approved ecosystem partner to benefit from the new fund, much as they did with Impulsion PME. IQ still plans to act as a \u201ccomplementary\u201d investor, bringing in private and quasi-public investors in on rounds. The fund is still sector-agnostic and only open to Qu\u00e9bec-headquartered companies, but will regularly evaluate which sectors align with the province\u2019s strategic priorities.\u00a0<\/p>\n
\u201cThe fund\u2019s objective is still the same, but it\u2019s more ambitious,\u201d Leli\u00e8vre told BetaKit. It plans to write cheques between $250,000 and $2 million, and can now complete multiple follow-on investments instead of just one.\u00a0<\/p>\n
Leli\u00e8vre, who will lead the fund\u2019s management, said that IQ has relaxed some application criteria and simplified the reference process to make it more \u201centrepreneur-friendly.\u201d<\/p>\n
The initiative comes 10 years after the provincial agency made its first investment in Montr\u00e9al-based e-commerce and point-of-sale firm Lightspeed in 2015. Over the past two years, Qu\u00e9bec\u2019s pre-seed and seed-stage VC investment landscape has become a source of concern, with experts worrying about a pipeline of companies drying up.\u00a0<\/p>\n
RELATED: Early-stage startups grapple with fallout after Qu\u00e9bec-funded investment program suspended<\/a><\/strong><\/p>\n
In the spring, a report led by industry group R\u00e9seau Capital worried experts<\/a> as it found that seed-stage venture deals in the province dropped by more than half year-over-year, while dollars invested had decreased by two-thirds. In August, early-stage investments had grown by 30 percent year-over-year, but broader VC activity<\/a> in the province had slumped.\u00a0<\/p>\n
With its mandate of economic development, IQ has a significant foothold in the Qu\u00e9bec VC landscape. VC and fund investments make up 17 percent of the agency\u2019s portfolio and are worth $1.2 billion, according to its latest annual report.\u00a0<\/p>\n
IQ, and by extension the provincial government, has invested more recently in early-stage funds like Telegraph Ventures<\/a>, which closed $35 million to back pre-seed artificial intelligence (AI) startups.\u00a0<\/p>\n
The agency recorded an annual loss of 4.9 percent<\/a> in 2024<\/a> on direct VC and indirect fund investments as the broader agency just broke even. In its annual report, IQ attributed the middling performance to slowing private investment, worsening economic outlooks, and a stock market dip.<\/p>\n