Radical Ventures Debuts Massive AI Fund to Stem Talent Drain
AI-generated image · Bay Street Wire
The firm's first close of over $1 billion USD aims to provide the scale necessary to keep Canada's AI scaleups from migrating to the U.S.
Toronto-based Radical Ventures has launched the Radical Breakouts Fund, a multi-billion-dollar vehicle designed to support AI scaleups in Canada and internationally. According to BetaKit, the fund's first close is "well over" $1 billion USD ($1.4 billion CAD).
Announced Tuesday at Prime Minister Mark Carney’s inaugural Canada Investment Summit, the fund is backed by a consortium of major Canadian institutions. Among the limited partners reported by BetaKit are OPTrust, CI Global Asset Management, BMO Financial Group, TD Bank Group, the Healthcare of Ontario Pension Plan (HOOPP), Canada Pension Plan Investment Board (CPP Investments), and the Public Sector Pension Investment Board (PSP Investments).
Radical co-founder and managing partner Jordan Jacobs stated that while Canada has world-class AI companies, it has lacked the capital scale to prevent them from looking to the United States during their most critical growth years. Jacobs noted that the fund is intended to ensure returns come home to Canada.
If Radical reaches its multi-billion-dollar target, BetaKit reports that PitchBook and Canadian Venture Capital & Private Equity Association data would make this the largest VC fund in Canada by a wide margin. The fund targets companies on a trajectory to become "trillion-dollar businesses," acknowledging a market shift where companies remain private longer and reach public markets at valuations of $100 billion or more.
As BetaKit reports, this launch comes alongside other major commitments, such as a $525-million USD fund from Intrepid Growth Partners and a planned $1-billion USD fund from the Royal Bank of Canada. Radical, which has previously invested in firms such as Waabi and Cohere, also launched an $800-million USD growth fund earlier in 2024.