Canada’s agri‑food startup landscape presents “a $13‑billion investment opportunity,” yet the sector remains “undercapitalized by domestic growth funds,” says a new RBC report, Seeding Scale: Addressing Canada’s agri-food growth capital gap.

The report, written by Lisa Ashton, says the sector accounts for only two per cent of federal growth capital and an estimated four per cent of total growth investments over the past five years. The report finds that although domestic companies attracted about $10.5 billion between 2015 and 2021, “growth investment in Canadian agri‑food is lower than it was a decade ago,” with deal values and counts declining.

Fragmented domestic funds and shallow capital pools mean many companies struggle to raise more than $15 million and often “seek capital abroad” as they scale. Ashton notes that government programs often fail to fit agri‑food scaling needs and suggest that initiatives like the 2025 federal budget’s $1 billion Venture and Growth Capital Initiative could “establish agri‑food lanes with tailored tools” to better align investment with Canada’s strategic advantages.

The report warns that without strategic changes, Canada risks “capping agri‑food sector’s growth potential” and losing talent and innovation to other nations.

“Canada is in building mode. Its ambition to attract $1 trillion in investment over the next five years to drive growth for the country is a signal. A key piece of mobilizing this investment is to put Canada’s existing infrastructure, growth, and venture funds to work for potential high-growth sectors, such as agri-food industries,” Ashton writes.