By Ray Sharma, CEO of Extreme Venture Partners
As a result of the pace of change, investing early in startups can be difficult. The failure rate is extremely high and the emotional roller coaster ride is beyond intense.
At Extreme Venture Partners we are constantly thinking about the shifting challenges founders experience in their initial start-up days.
From team formation, to prototyping, to planning a viable go-to market strategy, there are a lot of moving pieces that need go right in a relatively short amount of time. As pre-seed and seed investors we take the view that it’s important to build an ecosystem that can help entrepreneurs launch their start-ups.
When we launched Extreme Venture Partners Fund I in 2008, we understood that no new venture fund had been able to raise funds in Canada for over 5 years at that point.
The good news was that startup costs had dropped over 95% in the past decade. The bad news was the financial crises of 2008.
To differentiate and de-risk the venture fund we paired the fund with a software development lab, which we branded Xtreme Labs, a first for Canada. The software development Lab benefited from the fund’s business network, whereas the fund and the startups benefited from the due diligence lens and development expertise that the Labs provided.
Soon after in 2009, EVP launched the first start-up accelerator to Toronto, initially called Extreme University, then renamed to Extreme Startups when the program received external funding.
EVP Fund I became highly successful with notable exits such as Locationary (acquired by Apple), Bumptop (acquired by Google), and Chango (acquired by Rubicon Project), among others.
With EVP Fund II in 2014, we doubled down on the innovation model and pieced together the building blocks of a full-service ecosystem. This ecosystem is supported by a specialist startup in crowdfunding (Crowdmatrix), a specialist in crowdsourcing (Hackworks), as well as a specialist in startup services (Extreme Innovations).
Our second fund was most differentiated by the creation of Extreme Innovations, one of the first startup services and innovations labs in the country, working with experienced industry operators and large corporations to build new start-ups. EI has been able to trade margin for equity in external startups and has created several startups directly.
Thanks to these new additions we enable:
- Rapid ideation iteration with the benefit of a due diligence lens;
- Increased quality of companies at the pre-formation stage;
- Engagement in the Canadian development and funding landscape.
Recently we announced EVP Fund III, the latest evolution in our innovation model. As with our previous two venture funds, our new fund owns and is partnered with a new accelerator program called Extreme Accelerator.
Extreme Accelerator (EA) is the evolution of the accelerator model as a means to institutionalize innovation.
Since our launch of the first accelerator in Canada we have since seen the creation of hundreds more of various different angles and strategies. We believe it is time for change in the accelerator model and one aspect of this is the 30 international startups we wish to immigrate and fund.
EA is Canada’s first internationally-focused start-up fund program. As a designated organization under the government’s start-up-visa, we seek out the best founders and early-stage companies from around the world, and bring them to Toronto or their Canadian city of choice to break into the North American market.
The Extreme ecosystem is entering the end of its first decade of existence in the business of innovation. We fund mutations in business and its a demanding challenge to keep up with the pace.
Our dedication is to the evolving needs of the entrepreneur and the one certainty we anticipate and can depend upon is change.