The lost generation of entrepreneurs? The impact of COVID-19 on the availability of risk capital in Canada
Journal of Entrepreneurship in Emerging Economies
ISSN: 2053-4604
Article publication date: 28 May 2021
Issue publication date: 9 September 2021
Abstract
Purpose
Canada has lagged in access to capital for high-potential, growth-oriented new ventures, but has made considerable strides in the past decade. This study aims to examine the evolving state of the market for risk capital in Canada during the COVID-19 pandemic, providing a critical assessment of government policy from the perspective of angel investors and diverse communities of entrepreneurs.
Design/methodology/approach
A thematic analysis was conducted of seven COVID-19 roundtable discussions hosted by the National Angel Capital Organization that included 51 global and national-level business and political leaders. The analysis extracted the most salient details from the discussions, distilling them into timely and actionable insights for policymakers.
Findings
The analysis suggests that the government’s economic policy response to the COVID-19 crisis fails to address the sudden liquidity problems faced by new ventures. Entrepreneurs and angel investors have remained resilient, rallied as a community and demonstrated an extraordinary level of trust. Traditionally under-represented communities of entrepreneurs are more affected by the crisis than others.
Practical implications
The findings and recommendations are of relevance to policymakers interested in post-COVID-19 economic policies to address the unique challenges faced by start-ups and ensure their full contribution to economic recovery.
Originality/value
The paper presents several policy recommendations and proposes a novel framework to describe the impacts of the pandemic on different categories of start-ups.
Keywords
Acknowledgements
This work received financial support from the Women Entrepreneurship Knowledge Hub and made use of data from the National Angel Capital Organization (NACO) that is publicly available at www.builtbyangels.com. Additional in-kind support was provided NACO. Co-author Claudio Rojas is the Chief Executive Officer of NACO.
Citation
Croteau, M., Grant, K.A., Rojas, C. and Abdelhamid, H. (2021), "The lost generation of entrepreneurs? The impact of COVID-19 on the availability of risk capital in Canada", Journal of Entrepreneurship in Emerging Economies, Vol. 13 No. 4, pp. 606-627. https://doi.org/10.1108/JEEE-07-2020-0273
Publisher
:Emerald Publishing Limited
Copyright © 2021, Emerald Publishing Limited