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Canadian venture capital in H1 2026 reached $2.69B

Canadian startups raised $2.69 billion across 250 deals in the first half of 2026, the first first-half increase in dollars since 2021. Seed fell 31%, and foreign investors joined most large rounds.

Canadian Startup Ecosystem3 min readBy PacTech Team

The Canadian Venture Capital & Private Equity Association (CVCA) published its H1 2026 market overview on August 4. The headline is a split between dollars and deal count. Canadian startups raised more money in fewer, larger rounds. For founders raising now, the pattern shapes who gets funded and at what stage.

Canadian VC totals for H1 2026

CVCA recorded CAD $2.69 billion invested across 250 venture deals. Dollars rose 17% from $2.30 billion in H1 2025, the first year-over-year increase in first-half capital since 2021. Deal count fell 8.8% from 274, the fifth straight first-half decline. Average deal size rose to $11.38 million from $8.40 million.

The first quarter recorded $1.39 billion across 114 deals and the second $1.29 billion across 136. CVCA restated Q1 to include Beacon Software's $313 million Series C, which closed in January but was announced in June.

Large rounds took most of the capital

Sixteen financings of $50 million or more accounted for $1.57 billion, or 59% of capital. Five rounds exceeded $100 million. Rounds below $25 million made up 85% of disclosed deals but 32% of dollars.

The largest disclosed rounds were Beacon Software ($312.7 million), Dominion Dynamics ($139.0 million Series A), Koho Financial ($130.0 million Series E), Mangrove Lithium ($118.0 million) and Nesto ($107.0 million).

Funding by stage

  • Early stage: $1.18 billion across 68 deals, up on a flat deal count.
  • Later stage: $984 million across 18 deals, the lowest first-half later-stage deal count CVCA has recorded.
  • Growth: $127 million across three deals.
  • Seed: $285 million across 82 deals, down 31% in dollars and 13% in count.
  • Pre-seed: $52 million across 56 deals, an average of $0.97 million.

Foreign investors in large rounds

Rounds financed only by Canadian investors made up 66% of deals, in line with 2025. In later-stage rounds, 56% involved a foreign investor, up from 30% a year earlier. 44% involved a US investor, up from 19%. European participation reached 10.8% of deals, the highest share in CVCA's six-year series.

Funding by sector and province

ICT took $1.75 billion across 137 deals, 65% of capital and up 41% year over year. Cleantech held at $336 million. Life sciences fell 39% to $258 million, its lowest first half on record. Ontario led with $1.12 billion across 99 deals, followed by Quebec ($758 million) and British Columbia ($570 million). The three provinces took 91% of dollars. BDC Capital was the most active investor with 34 deals.

Exits and venture debt

CVCA counted 18 venture-backed exits worth $716 million, all through mergers and acquisitions. There were no IPOs, consistent with 2024 and 2025. Venture debt totalled $276 million across 11 facilities. The second quarter's $20.7 million was the lowest quarterly total in CVCA's records.

Founder takeaways

  • Expect a harder seed round. Seed dollars fell 31%. Raise with traction and a clear use of funds.
  • Plan for M&A, not IPO. Every H1 exit came through acquisition.
  • Build US and European investor relationships early. Foreign investors now join most large rounds.
  • Target BDC Capital. It was the most active investor by deal count.

Sources

  1. H1 2026 Market Overview
    Canadian Venture Capital & Private Equity Association (CVCA) · Aug 4, 2026
  2. Venture Capital Q2 2026
    CVCA Intelligence · Aug 4, 2026