

Canadian Prime Minister: $400M to Strengthen Canadian VC - mpr3
http://www.globalnews.ca/harper+announces+400+million+plan+to+strengthen+venture+capital+investment/6442788205/story.html

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manishsharan
I do not believe government should be in the business to fund VCs. Canada has
several pension funds and mutual funds and most of then seem to be doing well;
if American VCs can raise their funds from their pension funds, why do the
Canadian VCs need a hand out from the government even while Canadian funds are
actively participating in American Venture funds. Most likely the Canadian VCs
who do receive government money under this program will do so because of their
political connections and they will end up funding their cousins's start-ups.

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arikrak
It's true that long-term the government shouldn't be investing, but it can
sometimes help to get things going. Israel was successful in this regard - it
gave some funding in the 90's and then got out of the way. The questions is if
Canada really needs that same boost.

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pokoleo
Is having a boost the wrong thing to do? In any case, it strengthens the
country's economy, if spent correctly.

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ekianjo
That's the point, the government is completely clueless how to make good
choices on the market. All this kind of government intervention in specific
areas is the root of bubbles.

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bmmayer1
This just takes money from taxpayers who won't see a dime of the upside and
gives it to VCs so they won't have to risk a dime on the downside. Why is this
a good idea?

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gyardley
Venture capital largely gets spent on employee salaries. At worse, the money
while it lasts will create good jobs - think of it as a Keynesian stimulus,
something the Conservative government's not usually known for. At best, it
jumpstarts a lot of legitimate growth, like Israel's 1993 Yozma plan.

I suspect most of the people in this thread are just grousing because they
don't like their government, and therefore don't like anything it does. But
Canada's been starved for venture capital for a long time, which has resulted
in a lot of unnecessary brain drain. No program is guaranteed to succeed, but
here Harper's doing something quite smart.

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ekianjo
A Keynesian stimulus hardly works. It's been tried many, many times, with
always the same results: close to none, or ending up in worse situation in the
mid-term, by modifying the market incentives and removing cash that would be
invested somewhere else by private entities. It is not about not liking one's
government, this kind of government intervention is opposed to democracy and
free market.

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hluska
Saying this is "opposed to democracy" is extremely hyperbolic. Your comment
would be stronger without...

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ekianjo
Well, spending tons of cash that does not belong to you (but to the taxpayers)
to favor certain interests and not others can hardly be called democratic.
Only free markets are democratic, hence you will see that stimulus are largely
employed in authoritarian regims rather than actual democraties.

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bparsons
Stephen Gordon has a good take on this:
[http://www2.macleans.ca/2013/01/14/stephen-harper-state-
vent...](http://www2.macleans.ca/2013/01/14/stephen-harper-state-venture-
capitalist/)

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gyardley
Stephen Gordon doesn't know what he's talking about. Take this, for example:

 _In a market economy, the excess demand for venture capital would be closed
by a price adjustment: entrepreneurs would be obliged to accept smaller
injections of capital, would have to offer more control of their firms, or
some combination of the two._

This is only true if entrepreneurs _have_ to stay entrepreneurs, _have_ to
stay in the Canadian market, and _have_ to take venture capital, no matter how
crap the deal. Since none of these things are particularly true, Canada ends
up with fewer entrepreneurs, emigrating entrepreneurs, and entrepreneurs who
simply do without and grow their companies more slowly - and none of those are
particularly great for the Canadian economy.

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maxxpower
I will believe it when they start making money available, being an Ontario
based business in the GTA owned by a white male non minority not in the middle
of the sticks.... youre gonna be out of luck.

I went through no less than 50 funds available for companies in Ontario and
didnt qualify for a single one. Yet, if I was in North West Territories and
native... I would have millions at my disposal.

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tsieling
Yeah they hand out million dollar bills to anyone who isn't white. It's
happening everywhere and you're missing out. Boo hoo.

Get over your centre of the universe racism and make something of value.

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outside1234
Is that a stack of greenbacks they are flipping through? :)

