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Early-Stage Value Add Investment Criteria

AVAC’s Direct Investments provide pre-commercial development capital for promising early-stage commercial businesses in Alberta.

Purpose

AVAC investment funds are targeted at Alberta-based pre-commercial and start-up opportunities. The investment scope may include support for mentoring, management expertise, developing a new product or service, enhancing an existing service, Conducting a third-party assessment such as regulatory reviews, intellectual property strategy and protection, developing professional market assessments, assessments and feasibility studies, legal, professional and engineering advice, and select start-up activities including working capital for initial product launch. In addition, there are opportunities to finance selected equipment –for example, to enable pilot-scale or proof-of-concept processing, development of prototype products, and operating equipment required for initial product launch.

Pre-Commercial

• The company may be a start-up or an existing company provided the project requiring investment is at the pre- commercial (seed) stage of development.
• The opportunity must show potential to create growth within Alberta.
• New product development to intellectual property or trademark advice; may include product development, market assessments, establishing samples/prototypes and business plan development.
• Opportunities requiring professional advice (including legal advice on intellectual property), market assessments (marketing plans to feasibility level) and engineering advice, will be given consideration.

Investment Focus

Qualified companies must have the potential to increase commercial business activity in one or more of Alberta’s value-added agribusiness (agrivalue™), information and communications technologies (ICT), life sciences and other industrial technology sectors, and have the ability to possess a sustainable competitive advantage. Both new and existing companies may be considered providing that their proposed project requiring investment is at the pre-commercial stage of development.

Investment proposals are expected to meet AVAC’s following commercialization due diligence requirements, including:

• Strong management team evident, or the ability to attract a strong management team,
• satisfactory credit history for applicant and the principal/s,
• acceptable competitive environment, including freedom to operate,
• viable developmental plan and market assessment,
• confirmation of complementary financing,
• likelihood that the company will be able to attract subsequent financing to further the business, and
• the investment size is appropriate to the size and nature of the business opportunity.

As an early-stage hands-on investor, companies are to expect active participation by AVAC management in the strategic and operational direction with the company board and management.