Fintech-focused venture capital fund Luge Capital has raised an initial $71 million to invest in early-stage startups in Canada and the US.
Luge invested in 21 companies from the roughly $85 million raised for Luge Fund I, including the likes of Flinks (acquired by National Bank of Canada in 2021), Plooto, Owl, Flare, and OneVest.
For its second fund, Luge is looking at an ultimate fund size of $100 million and has been buoyed by returning investors CDPQ, Desjardins, BDC Capital, Sun Life, Industrial Alliance Financial Group (iA), Fonds de solidarité FTQ, and new investor Inovia Discovery Fund I.
In addition to the core investment thesis from its first fund, Luge is expanding its scope to include fintech startups that operate at the intersection of financial services and other large industries, as well as fintech-oriented ESG startups. Initial investments made into startups from Fund II are expected to be slightly larger than those made from Luge’s first fund.
“Financial services impact the lives of every person, from opening a bank account and making payments to buying insurance and making investments. Yet large institutions are finding it challenging to modernize their legacy technology,” says Karim Gillani, general partner at Luge Capital. “By investing in high-calibre fintech founders who are solving the industry’s biggest problems, Luge is helping to drive innovation across the financial services that are the lifeblood of the economy and account for 20 percent of the GDP in the U.S. and in Canada.”