The Canadian government’s now three-year-old Venture Capital Action Plan (VCAP) has done a very good job of leveraging public money to encourage private sector risk capital investment. According to figures released by the Canadian Venture Capital and Private Equity Association (CVCA), the program has taken an initial $340 million in federal money and translated that into $886 million.

Committed in Budget 2014 by the previous Conservative government, VCAP’s goal was to create large scale, private sector funds of funds with institutional and corporate investors participating. The level of private sector investment attained so far represents two-thirds of the program’s $1.4 million objective.

The CVCA describes the program as having “an overwhelmingly positive impact on Canada’s innovation ecosystem.” It’s especially true for the information and communications technologies (ICT) which has garnered the lion’s share of funds and investments over the past three years. The same can be said for the life sciences and clean technology arenas but on a much smaller scale. (For more click HERE.)

The venture capital association says that because of the program’s current success, the federal government should create a second stream for VCAP in Budget 2017.

Mike Woolatt, CEO at the CVCA, notes that Canada needs to create and grow new companies and without another VCAP, innovation investment may take a step backwards.

“In times of fiscal constraint and focus on innovation, a program like VCAP which costs very little but has a direct impact on innovation is the right move,” he said.

Figures includes in the CVCA assessment of the VCAP program come from data previously collected by BDC Capital.