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University of Waterloo Pioneers Endowment-Backed VC Funding in Canada

University of Waterloo News | Jun 28, 2023

Akash Vaswani and Ross Robinson general partners of VF II - University of Waterloo Pioneers Endowment-Backed VC Funding in Canada

Akash Vaswani and Ross Robinson, general partners of VF II

The University of Waterloo will become the first post-secondary institution in Canada to invest from its endowment into a venture capital (VC) fund launched by the team behind its affiliated startup incubator.

  • The University of Waterloo, for the first time, has chosen to divert part of its endowment, specifically up to $5 million, towards venture capital (VC) investment. This move results in the creation of Velocity Fund II (VFII), a venture capital fund designed to support startups. This is a milestone for the University as it's the first time the institution's endowment is being leveraged for venture capital.
    • The VFII, led by general partners Ross Robinson and Akash Vaswani, aims to raise a total of $25 million USD.
    • Investments will target pre-seed and early seed stages, with amounts ranging from $25,000 to $500,000​.

See:  Waterloo Region’s Communitech Receives $38M of Federal Funding from the ElevateIP Program

  • Velocity Fund II originates from Waterloo's Velocity startup incubator and has plans to invest in both Velocity and non-Velocity companies.
    • Velocity, since its inception 14 years ago, has supported over 400 companies, collectively raising $4.5 billion in funding.
    • Some notable Velocity graduates include Faire, a retail connection platform valued at over $12 billion, and ApplyBoard, an international student application aid platform with a post-money valuation of $4 billion CAD​.
    • Waterloo's endowment model is part of an emerging trend, inspired by successful VC funds backed by endowments and universities in the United States. During the venture boom in 2021, the Massachusetts Institute of Technology reported a gain of 55.5%, or $9 billion, from its venture fund​​.

Michael Ashmore, chair of the Finance & Investment Committee at Waterloo:

The University’s donors have been yearning for the endowment to play a more active role investing in outstanding Waterloo startups, and we’re excited that this investment into the Velocity Fund II could be just the beginning, and at such an opportune point in the economic cycle.

View the announcement --> here


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