Sure the Canadian banks are more stable but they are EXTREMELY conservative when it comes to lending out money. That's why the USA has a robust venture capital milieu while Canada does not.
In fact a Canadian bank would rather loan money to an American business to buy out a Canadian business than to lend the same Canadian business to expand.
Like many other things affecting western countries though, it's worse in Canada since we have lower investment rates, spend less on R&D, have an ultra-risk averse culture, extremely high costs, etc...
I can't speak for Canada and I may be a wrong, but it seems to me harder to loan money for business than in NA. Banks are the ones that don't want to take risks, not necessarily the people with ideas.
Also failures aren't considered the same in every job market.
It speaks more to canada's lack of entrepreneurial spirit than anything else. There's a reason good canadian companies go to the U.S. to get funding...
I'm advising a company right now based on Toronto who is fundraising, and it is definitely easier for them. The CEO tells me that investors will literally say, "I get 50% more for every dollar I put in!".
It's totally true -- American investors love Canadian companies right now.
yes, there are much less investment funds and also less banks in Canada, compared to the US. This is going to be introduced as an viable and trusted source of capital for new & growing businesses.
Canadians take risks? Who knew!? (My personal porfolio, %90 of it is companies located in Vancouver and listed in TSX or TSX-V.) Canada is the premier public fundraising country in the world, I believe. (The US stifles innovation with onerous SEC regulation... so Canada, which has smaller population, is the place to do your reverse merger, or buy shelf companies, etc.)
No, I think this is just the nature of Canadian investors - they are much more risk-adverse and don't seem to have the stomach for the "swing for the fences" angel investment that US investors have. It's cultural.
"It is one of the main reasons we are able to offer funding terms that are better than anything else out there. Well, except maybe Canadian government funding, but we’re not all fortunate enough to be Canadian."
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