Startup Fund Owned by British Columbia Eyes Growth Despite Budget Strain

Buildings in Metrotown in Burnaby from downtown Vancouver, British Columbia, Canada, on Tuesday, May 27, 2025. A strong jump in tariff-driven exports fueled Canada's growth at the start of this year, offsetting domestic weakness in other parts of the economy. Photo by James MacDonald /Bloomberg

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(Bloomberg) — An investment fund for startups owned by British Columbia’s government is studying how to recapitalize and grow, including the possibility of taking in private capital, its chief executive officer said. 

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The western Canadian province launched InBC Investment Corp. in 2021 to provide money to new companies and venture funds, prioritizing climate technology and other themes such as supporting reconciliation with Indigenous people.

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Seeded with an initial C$500 million ($366 million), InBC has deployed about 35% of that so far into 15 businesses and nine venture funds so far, spanning recycling, robotics, carbon capture and agri-tech. 

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CEO Jill Earthy wants the fund to be self-sustaining, and eventually a profit center for the province. She wants to “keep the momentum going” at a time when the government’s own finances have been worsening. 

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“We will be thinking soon too about recapitalization and growing our fund,” she said in an interview. There are “lots of different pathways” including going back to government for additional capital. When asked if that could include bringing in external investment, Earthy agreed.

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It’s too early to say more, and InBC will be evaluating options over the next six months, Earthy said, adding that she expects the government of BC would remain the majority owner.

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The fund’s early investments include bio-printing startup Aspect Biosystems Ltd., carbon capture firm Svante Technologies Inc., robotics company Sanctuary AI and Raven Indigenous Capital Partners, which says it’s the only Indigenous-owned and led impact investment firm in North America.

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About C$200 million of InBC’s capital is earmarked for follow-on investments on existing holdings, which leaves about C$135 million for additional investments, she said. The firm could also consider lending money, investing in different types of funds, or even making private equity-style “succession” investments, if such alternative investments addressed gaps in the market, Earthy added.  

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The government is currently conducting a spending review as its finances face pressure from a sluggish economy and heavy spending on health care. BC’s deteriorating balance sheet has seen the west coast province downgraded repeatedly by bond-rating companies in the past four years.

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“I don’t know if everything is totally safe,” she said of InBC’s initial C$500 million. “But yes, we have no concerns right now. We’ve been told to keep doing what we’re doing.”

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InBC can’t force its portfolio companies stay in Canada, but its side letters include the option to negotiate an exit if a startup is going to leave. InBC may not always exercise that option if it’s not in the taxpayers’ interest, Earthy said.