To be sure, this isn't an entirely new trend; US-based investors have largely been behind the recent surge in Canadian PE activity since the financial crisis. Canada’s own PE ecosystem has grown in fits and starts through the years, and annual fundraising numbers are heavily influenced by the handful of larger Canadian firms that happen to be fundraising that year. Just six Canada-based PE funds have closed in 2017, raising roughly C$3 billion in commitments. Meanwhile, US-based PE fundraising has been on a tear, and investors looking to deploy dry powder have set their sights north for deals.
It's becoming clear how heavily influenced the Canadian market is to outside investors in 2017. Of the country's C$47 billion in PE investment so far this year, more than C$30 billion of that total comes from deals without any Canadian involvement. That amounts to at least 64% of purely foreign investment, a percentage that has hovered below half for the last decade. Consider us a bit surprised for now.
Note: This column originally appeared in The Lead Left.
Read more in the 2017 Canadian PE & VC Breakdown: II.