Summary: the capital reaches companies through funds, and the funds must raise their match first
On October 22, 2026, the Government of Canada announced a $1.75 billion Venture and Growth Capital Plan. The government does not invest any of it in companies itself. It commits the capital to private funds, which, in the streams whose terms are published, must first raise matching private capital and then invest in companies. The required match differs by stream: $3 of private capital for every federal $1 in the fund-of-funds stream, $2 for every $1 proposed for the later and growth stage stream. For the $75 million pre-seed and seed stream, the match is not yet published. The interactive diagram below traces each stream to the companies it is meant to reach. This note covers what the diagram cannot show: timing, what investors will still assess, and what to do in the next 90 days.
Part 2 of this series covers what the federal budget tabled on November 5, 2026 changed for these companies: a proposed capital gains exemption, a longer small business rollover, wider SR&ED, and the Canada Strong Fund.
- Series B and later companies are the main beneficiaries. The effect is a larger pool of Canadian funds able to lead future rounds; companies do not apply.
- Pre-seed and seed companies see little direct change until the design of the $75 million stream is published, including how much private capital its funds must raise.
- AI and dual-use companies have separate lanes, announced alongside the plan, that can invest directly.
- The nearest deadline is November 23, 2026, for the Regional AI Initiative from Pacific Economic Development Canada (PacifiCan) and for input on the design of the growth stream.
Each company type has a different path through the diagram
Select your company type at the top of the diagram to fade the cards that do not apply, and open any card for what it means at your stage.
How federal and BC capital reaches your company
The plan's $1.75B (the $750M Early and Growth Stage Investment Strategy and the $1B Growth Venture Capital Catalyst Initiative, or Growth VCCI) reaches companies through private funds selected by the government. In the streams whose terms are published, those funds must raise matching private capital first. Companies don't apply to the plan: they pitch the funds. Separate lanes sit beside it: BDC's defence platform and InBC can invest in companies directly, and the Canadian Tech Growth Fund may take equity stakes in AI firms. Green tags mark where a company makes contact itself.
Select a company type below to highlight its path. Hover or tap a card for what it means at your stage. Numbered chips link to the government source.
For the $1.75B plan, you pitch investors in row 4. BDC, the private LPs and the selected funds in rows 2 and 3 work at fund level, and companies don't apply to them. You approach the direct lanes and the non-dilutive programs yourself. Pick a company type for the order.
- Your current and target lead investors row 4: ask whether they are applying to the later and growth stage stream, or are backed by a fund-of-funds.
- InBC row 2: a possible direct minority co-investor in a BC company, independent of the federal timeline.
- SR&ED row 6: claim it with your corporate tax return, and model it before and after the round.
- NRC IRAP row 6: talk to an Industrial Technology Advisor about a technology project.
- PacifiCan Regional AI Initiative row 6: only for an AI commercialization or adoption project, by noon PT, Nov 23, 2026.
- Canada Strong Fund row 1: nothing to contact until its investment criteria are published.
- BC eligible business corporation registration row 4: register and get authorized before the angel round closes, so your investors can claim the BC credit.
- Angels and seed funds row 4: ask seed funds whether they are emerging managers or expect a program allocation.
- NRC IRAP row 6: talk to an Industrial Technology Advisor early.
- SR&ED row 6: claim it with your corporate tax return; track eligible R&D costs from day one.
- The $75M pre-seed and seed stream row 3: nothing to contact yet. Watch for its design and call.
- PacifiCan Regional AI Initiative row 6: apply by noon PT, Nov 23, 2026, with the non-government match confirmed.
- BDC Defence Platform row 1: if your technology has a defence or dual-use application; Strong North for deep tech with a defence or dual-use application.
- Canadian Tech Growth Fund row 1: nothing to contact until its terms are published.
- VC and growth funds row 4: as for your stage; AI companies compete on the same terms as others.
- SR&ED and NRC IRAP row 6: for work that resolves technological uncertainty.
Series B+You don't apply. The plan adds capital to the funds your next lead investor raises from.
Pre-seed and seedA $75M stream targets your stage. Its design and call have not been published.
AI and dual-useAlso look at the separate AI and defence lanes beside this card.
Series B+If AI is your core product, watch its terms: it may take equity stakes in leading AI firms.
Pre-seed and seedAimed at scale-ups, so early-stage firms are unlikely to be in range.
AI and dual-useA potential federal equity route. Watch for its terms.
Series B+Only if you sell into Canadian or allied defence supply chains.
Pre-seed and seedOnly if your deep tech has a defence or dual-use application; then Strong North is relevant.
AI and dual-useYour primary lane if your technology has a defence application.
Series B+A possible federal co-investor beside your lead investor in a priced round. Watch for its criteria.
Pre-seed and seedAimed at strategic, larger companies, so early-stage firms are unlikely to be in range.
AI and dual-useThe budget's example of this kind of investment is a commitment to an AI company's Series E.
Series B+You don't deal with BDC in this program; it backs your investors. Ask yours whether they're applying.
Pre-seed and seedSame: BDC and ISED choose the funds. Your investors' selection shapes your access.
AI and dual-useBDC also runs the defence platform, which can invest directly.
Series B+A possible direct minority co-investor now, independent of the federal timeline.
Pre-seed and seedInBC backs funds that invest across stages, seed included, and its BC investment rule keeps that money local.
AI and dual-useInBC invests across innovation sectors and weighs BC jobs, revenue and R&D.
Series B+The bottleneck. If your target investors can't raise their match, the federal dollars don't reach your round.
Pre-seed and seedSmaller funds often find LPs hardest to raise, which can slow seed capital.
AI and dual-useSame mechanics apply; the match is required regardless of sector.
Series B+Two steps removed: they back the VC funds that lead B and C rounds.
Pre-seed and seedFund-of-funds can also back seed and early-stage funds.
AI and dual-useNo AI allocation; the call's standard sector exclusions apply. AI companies compete on the same terms as others.
Series B+Relevant only if you're a life sciences company.
Pre-seed and seedLife sciences investors at your stage may receive allocations here.
AI and dual-useAI for drug discovery or medtech may fit here as life sciences.
Series B+Less relevant; emerging funds typically write smaller cheques.
Pre-seed and seedRelevant if your investors are newer or regional funds.
AI and dual-useSector-focused emerging funds may specialize in your area.
Series B+Built for you: more domestic capital for Series B and later, from funds investing on the same terms as their private investors.
Pre-seed and seedYour next-stage pool once you're past Series A.
AI and dual-useNo sector quota. Defence and dual-use are permitted, with conditions.
Series B+Not your stream.
Pre-seed and seedBuilt for you. Watch for its design and call.
AI and dual-useNo sector categories have been published for this stream.
Series B+Expect diligence on revenue quality, retention and sales efficiency.
Pre-seed and seedFirst paying customers and a repeatable way to find them carry weight.
AI and dual-useExpect questions on defensibility, compute costs and gross margin.
Series B+Rarely relevant at your stage.
Pre-seed and seedRegister as an eligible business corporation and get authorized to raise credit-eligible capital before you close.
AI and dual-useThe same credit can apply to early AI and deep tech companies.
Outside the fund structure: BDC's defence platform and InBC can invest in companies directly, the Canadian Tech Growth Fund may take equity stakes, and the proposed Canada Strong Fund may co-invest beside a lead investor, skipping layers 3 and 4.
Series B+Model the credit before and after a large raise. A round that gives non-residents or public corporations control, including through term-sheet share rights, can end CCPC status and the enhanced rate.
Pre-seed and seedOften a large non-dilutive source. Track eligible R&D costs from day one.
AI and dual-useWork that resolves technological uncertainty can qualify; routine use of existing models usually doesn't.
Series B+The match can be shown with bank statements, an unused line of credit or signed term sheets; a recent round often supplies it.
Pre-seed and seedCheck the age, headcount and TRL tests first; a $200K minimum implies a project of $400K or more.
AI and dual-useBuilt for AI commercialization and adoption in BC. SR&ED on the same costs can reduce the award.
Series B+Available up to 500 full-time equivalent staff for technology development projects.
Pre-seed and seedOften an early non-dilutive source. Talk to an Industrial Technology Advisor early.
AI and dual-useSupports staff and materials for technology projects with a commercial path.
Series B+BSP offers repayable funding of $200K–$5M for scale-up, technology commercialization, productivity and market-diversification projects if it reopens.
Pre-seed and seedInnovative Solutions Canada can make government a first customer, which brings revenue as well as funding.
AI and dual-useThe AI Compute Access Fund's last call required revenue, or investor interest shown by at least a Series A round. Check BOREALIS for calls.
Key dates 3 4 11
- PacifiCan Regional AI Initiative current intake closes; later intakes not yet dated
- Later and Growth Stage stream design input due to ISED
- Growth VCCI fund-of-funds EOI closes
- of federal confirmation: fund-of-funds first close expected; growth-stream funds full close proposed (30 months maximum). Program capital is committed as matching private capital is raised.
Stacking 10
- Each program sets its own stacking limit; check each one before you combine them.
- The Regional AI Initiative keeps total government support at or below 50% of project costs, counting SR&ED and other tax credits.
- Its non-government match is confirmed at application and again before approval: bank statements, an unused line of credit, funding letters, funding agreements or signed term sheets. Forecasts, receivables, future funding commitments and SR&ED receivables don't count.
Sources
- 1Minister Joly unveils Canada's new Venture and Growth Capital PlanISED news release · Oct 22, 2026Used for: Government of Canada · BDC · Fund-of-funds, life sciences and emerging managers
- 2Backgrounder: Canada's Venture and Growth Capital PlanISED backgrounder · Oct 22, 2026Used for: Government of Canada · Canadian Tech Growth Fund · BDC Defence Platform · Life sciences and emerging managers · Pre-seed and seed stream · Companies
- 3Discussion guide: Later and Growth Stage Investment StreamISED · Oct 2026 · proposed terms, input due 5:00 pm PT, Nov 23, 2026Used for: BDC · Private LPs · Later and growth stage funds · Series B+ companies · Key dates
- 4Growth VCCI call for expressions of interest: Fund-of-Funds streamISED · closes 12:00 pm PT, Jan 21, 2027Used for: BDC · Private LPs · Fund-of-funds managers · Key dates
- 5
- 6
- 7
- 8Budget 2025: Tax measures, supplementary informationDepartment of Finance CanadaUsed for: SR&ED (federal)
- 9BC scientific research and experimental development tax creditProvince of BCUsed for: SR&ED (BC credit, CCPC conditions, taxable-capital phase-out)
- 10Regional Artificial Intelligence Initiative: funding overviewPacifiCanUsed for: PacifiCan Regional AI Initiative · Stacking
- 11Regional Artificial Intelligence Initiative: who can applyPacifiCan · intake closes 12:00 pm PT, Nov 23, 2026Used for: PacifiCan Regional AI Initiative eligibility · Key dates
- 12Financial support for technology innovation (NRC IRAP)National Research Council CanadaUsed for: NRC IRAP (eligibility and purpose)
- 13
- 14
- 15
- 16Budget 2026: Tax Measures, Supplementary InformationDepartment of Finance Canada · Nov 5, 2026Used for: Angels · SR&ED (Budget 2026 proposals)
- 17Budget 2026, Chapter 2: A more competitive and connected CanadaDepartment of Finance Canada · Nov 5, 2026Used for: Canada Strong Fund
- 18Budget 2026, Chapter 6: A more efficient governmentDepartment of Finance Canada · Nov 5, 2026Used for: BDC (combination with EDC)
- 19Bill C-15: Budget 2025 Implementation Act, No. 1LEGISinfo · Royal Assent Mar 26, 2026Used for: SR&ED (federal enactment)
- noteWhat investors typically look for, and every "what this means for you" note, is general guidance based on market practice. It is not a program rule, and not financial, tax or legal advice. Proposed terms may change after consultation.
© 2026 Authgnosis Business Consulting Inc. All rights reserved.
The diagram shows the path; timing and investor scrutiny decide the outcome
Timing is governed by the private match. Both main streams commit federal money only as fund managers raise private capital, over a window of up to 18 months after selection. In the fund-of-funds stream, the federal share is then drawn ahead of the private money. Any initial close must unlock at least the minimum federal commitment, so some capital can reach companies before a fund is fully raised, but not before managers are selected and have raised part of their match. For a company raising in the next twelve months, the practical effect is limited; for a company planning a Series B or C in 2027 or later, it is more material.
Investor scrutiny does not change. In the later and growth stage stream, program capital invests on the same terms as private capital, with no incentives, so funds have every reason to keep diligence on revenue quality, retention, sales efficiency and the go-to-market team unchanged. The fund-of-funds stream does give its private investors better terms: they are repaid first, and with a higher return. Those terms sit between the fund-of-funds and its investors, and do not reach the companies its funds back. The plan increases the number of funds able to write the cheque, and the diligence standard stays where it is.
Equity and non-dilutive funding are complements. The Regional AI Initiative requires at least half of project funding to come from non-government sources, confirmed at application and again before approval, and cash from a recent round or a signed term sheet can supply that match. A large round can also affect the enhanced Scientific Research and Experimental Development (SR&ED) credit. A round that gives non-residents or public corporations control, including through share rights in the term sheet, can end Canadian-controlled private corporation (CCPC) status, and the enhanced limit phases out as the associated group's prior-year taxable capital rises from $15 million to $75 million. CCPC status at issuance is also a condition of the proposed Canada Growth Incentive, so the same term-sheet clause could cost both. Both are worth modelling before the round closes.
CEO and CFO checklist
The deadlines are in the diagram's key dates panel. The actions below are sequenced for a CEO and a CFO working together, and do not depend on the plan's final terms. Part 2 of this series adds five items for Budget 2026.
CEO
- Ask current and target lead investors whether they intend to apply to the fund-of-funds or later and growth stage streams.
- Confirm the company will meet the proposed Canadian-based definition at the time of its next investment, particularly if US expansion or hiring is planned.
- Decide whether to submit input to the Later and Growth Stage consultation, alone or through an industry association, before 5:00 pm Pacific time on November 23 ([email protected]).
- For AI companies: assess fit with the Regional AI Initiative before the November 23 intake closes, since later intakes have no dates yet and cover only projects starting after April 1, 2027, and monitor the Canadian Tech Growth Fund for published terms.
CFO
- Model SR&ED eligibility before and after the next round, including CCPC status and taxable capital, and Canada Growth Incentive eligibility.
- Inventory the confirmed non-government funding that would count as a match for repayable programs.
- Assemble a due diligence data room with current financials, cap table, key contracts and the operating model.
- For pre-seed and seed: confirm BC eligible business corporation registration and authorization before the next angel round closes.
Investor readiness is the part of the outcome a company controls
The final row of the diagram shows where Authgnosis works with each company type. The common thread is the assessment investors make before committing capital: a growth plan they can hold the company to, an economic model they can test, and evidence that the company can acquire customers repeatably.
To review where your company sits on this map and what to prepare first:
Sources
Each card in the diagram links to its government source, and the full list is indexed at the foot of the diagram. The primary documents are:
- Minister Joly unveils Canada's new Venture and Growth Capital Plan, ISED news release, October 22, 2026
- Backgrounder: Canada's Venture and Growth Capital Plan, ISED, October 22, 2026
- Discussion guide: Later and Growth Stage Investment Stream, ISED, October 2026
- Growth VCCI call for expressions of interest: Fund-of-Funds stream, ISED
Current as of November 6, 2026. This Research Note is general information for founders, CEOs and CFOs of BC technology companies. It is not financial, tax or legal advice. Growth-stream terms are proposals under consultation. The Budget 2025 SR&ED changes were enacted by Bill C-15 on March 26, 2026; the Budget 2026 measures in Part 2 are proposals. Program terms, eligibility and deadlines should be confirmed with the administering agency before acting. Authgnosis is not affiliated with any government program.
© 2026 Authgnosis Business Consulting Inc.