What of BCE Capital?

BCE Takeover part 20

With new ownership a few months away for BCE (BCE:TSX), what will the OTPPB (“Teachers”) takeover mean for BCE’s venture capital arm, BCE Capital?

Prior to the KKR rumour, BCE Capital was said to be in fundraising mode, with a lead order coming from their (soon to be former) parent co. in the same spirit as the TD Bank and Birchill Equity Partners, for example. Historically, BCE Capital has been what’s called a captive fund, with one limited partner since it was founded in 1987. The understanding was that BCE had offered a very meaningful lead order, provided that the VC team could round out the fund with chunky commitments from third parties.

With several senior VCs on staff, and offices in Ottawa, Toronto and Boston, BCE Capital is about as big and experienced a team as you’ll find at most Canadian VC firms. But, if the new fund isn’t closed by the time Teachers shows up (with their “179 degree shift“), what will become of the firm?

Capital is already scarce. Canada can’t afford to lose another VC shop. The question is, do the prospective limited partners see it that way?

MRM