MATTHEW CHEN
FACTOID
B.C. companies accounted for 4 per cent of all VC investment in Canada in the rst half of 2015
A
s Vancouver has
transformed itself
in the past decade
into one of North
America's premier technoloy
hubs, few have played as pivotal
a role as Paul Lee. The former
president of Electronic Arts
jumped into the venture capital
business in 2010 as founder and
managing partner of Vanedge
Capital, a $100-million venture
capital fund initially focused
on digital media companies.
Through Vanedge, Lee has
backed local tech success stories
including D„Wave Systems
(where he sits as chair of the
board) and Recon Instruments,
which sold to Intel last June for
an undisclosed amount. The
51-year-old Burnaby native has
deep roots in the city's technol-
oy scene and currently sits on
the premier's Jobs and Economic
Investment Council.
How do you go about choosing
the companies to invest in?
We think there are a number of
big trends that are disrupting
a lot of businesses and adding
to what consumers expect.
Whether it's a smartwatch,
your laundry machine or your
Fitbit, all of that is going to start
connecting to the Internet,
which dramatically increases the
security footprint that compa-
nies are going to be responsible
for. So cyber security is a big
sector for us. Secondly, a lot of
things we now take for granted
can only be done because of all
these connections and because
Paul Lee
T h e C o n v e r s a t i o n
of the cloud. Systems like Siri or
self-driving cars only work with
massive computing resources
and a strong Internet connec-
tion. Consumers and companies
are also turning around and
saying, "I'm not willing to buy
this as a one-time service—but
if you maintain security and
update that product, I will pay
you monthly to use your ser-
vice." Finally, consumers expect
things to be easy to use. Apple
really fundamentally changed
that: if I can't —gure it out, you
didn't design it properly.
When you launched Vanedge,
did you intend to focus on
investing in B.C. companies?
We didn't, but I started at
a local company that I
thought could become a
lot bigger—if we had the
capital. Fundamentally,
we su˜er from a lack
of venture capital
in B.C, so when
we launched
Vanedge, we
decided that we
wanted to be the
venture fund that
we couldn't —nd
when we were
on the other side,
looking to raise
money. Our goal is
to build a stronger
venture capital
industry here; we
want to be able to
build those compa-
nies that will be
worth $1 billion.
The godfather of B.C. digital media on the sad state of local
VC—and what he's going to do about it by Jacob Parry
Top Three
InvesTors In
vanedge
How bad is the local VC scene?
Eighty-seven per cent of Cana-
dian venture funds are based in
Ontario and Quebec, so there's
no doubt that we su˜er from
shortage of capital in B.C. And
that hurts.
SourCE:
VANEdgE
CApiTAl
The B.C. renaissance Fund
electronic arts
nicola Wealth
Mangement
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FEBruArY 2016 BCBusiness 19
