(Left to right) Keith Ippel, OliviaHornby, Graham Day.
After working for over a dozen years with traditional investments and institutions, Olivia Hornby was seeking to apply her skills to drive positive and meaningful change for the future when she discovered Vancouver-based accelerator, Spring Activator.
Serial entrepreneur and investor Keith Ippel founded Spring Activator 10 years ago and along with Graham Day, former Chief Investment Officer of Spring, and Olivia, launched a $20-million fund to back cleantech and healthcare startups. The team came together in January 2023 and celebrated their first close in October. Shortly after, they began making their first investments.
"To be able to generate strong returns and positive impact in the future is a win-win for all," says Olivia, managing partner with Spring Impact Capital. "I believe that investors are increasingly looking to gain more meaning and purpose from their investment strategies. I realized that I could help fill a really important role connecting capital to changemakers who are growing the leading companies of tomorrow."
Spring supports impact entrepreneurs who want to change the world in a positive way. It's a platform including accelerator programming, an angel network, and angel investing that exists in six provinces across Canada with 35 employees. "It's a well-oiled machine that I consider to be our sister business. What really attracted me to this opportunity was that there was this operating business that is an engine that the fund plugs into," says Olivia.
So far, the interest in Spring Impact Capital has been positive from founders and investors alike.
"We've had a great response to the impact investing message. The community has been very supportive — from potential investors, co-investors and founders. There has also been lots of collaboration from other funds and co-investment partners from across the country," she says.
Finding inspiration from founders
Spring Impact Capital made its first two investments in 2023. The first is in Cognito Health, a mental health platform based in Victoria, B.C., which provides comprehensive virtual care for a variety of conditions including ADHD, depression and anxiety. The second is a Retinalogik, a Calgary-based company that has developed virtual reality software for eye exams which will allow more clinics, especially in rural areas, to screen for diseases like glaucoma.
"It's disrupting the old model of eye testing," says Graham, Managing Partner at Spring Impact Capital. "The bulky equipment used at optometry and ophthalmology offices is expensive for the clinic to buy and operate, not to mention uncomfortable for the patient. This technology lowers the cost for clinics to offer these services while improving the patient experience. We're excited to see traction in multiple markets, from clinics in urban areas, to mobile units serving rural areas and even hospitals in developing countries."
The fund is focused on investing at the pre-seed and seed level, which is where the partners' identified the biggest need and opportunity.
"We think there's great potential for generating returns but also for supporting founders at that stage of their journey, specifically because we have all these resources with Spring Activator such as mentor programs and online resources. The whole program is already built to support early-stage founders and those who have traditionally been under-served," explains Keith, Managing Partner at Spring Impact Capital.
Trends emerging for 2024
In the healthcare space, Spring Impact Capital is seeing more software and solutions that focus on the virtual care environment such as how to improve efficiencies for patient care and how to improve hospital efficiencies.
"In the climate arena, investments are capital intensive so we're leaning in on more software services and materials innovations that are less capital intensive. There are lots of interesting applications of AI and machine learning here — if you think of things like environmental reporting — a lot insights on environmental impact can be gleaned from large amounts of data," she says.
Working with Osler
Spring Impact Capital was familiar with Osler and when the principals were starting to set up the fund, they wanted things to be as straightforward as possible for their potential investors.
"We know that impact investing is a little bit unique in and of itself," says Olivia. "We surveyed potential investors and two or three said we had to use Osler. Then I met [Osler EHG partner] Laura Webb in a Women in Tech event. She's been incredibly supportive, and we've been happy with the support that we've received," says Olivia.
Advice for founders in 2024
There are still pockets of opportunity for founders looking for early-stage investment says Olivia.
"We're seeing a lot of dry powder for climate funds, which leads to lots of opportunities in the climate space. I think there are still opportunities to raise capital, but I think that the focus should be on the fundamentals — that's not going to change, unless maybe you're an AI company, investors still want to make sure that your business can survive without a continual influx of capital. We want to know that if we're going to invest today, what's the probability that you're going to need capital by the end of next year? And how hard is it going to be for you to raise that capital?"
Generally, Olivia says investors in the market are still a little bit cautious. Her advice to founders is to consider whether they really need to raise capital now.
"I often meet early-stage founders and I'll put the question out to them: Do you need to raise now or is it better that you focus your time on product iterations or sales? Frankly, for a lot of founders that we meet we say come back to us in six or 12 months once you've iterated a little more."
Spring Impact Capital is actively looking ahead to its second close in the first half of this year. "What we're doing is really resonating with people who want to generate returns but also really care about supporting Canadian innovation," says Olivia
"With more millennials coming into wealth, we're seeing the biggest intergenerational wealth transfer from the boomers to the millennials. And women are having more financial assets and taking more ownership over those financial assets. They are certainly more interested in impact investing," she says.
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