Canada's startup ecosystem is experiencing significant growth, with investment levels climbing across all stages compared to last year. Entrepreneurs in Canada are tackling pressing issues, transforming traditional industries such as Consumer, FinTech, and SaaS while also making strides in cutting-edge areas like AI, Healthcare, PropTech, Digital Infrastructure and Cyber Security. This highlights the growing need for robust early-stage funding platforms with a global reach to drive and sustain these innovations.
At Antler, we empower exceptional talent to create impactful technology companies from the ground up, guiding them from ideation to building billion-dollar businesses. In Canada, we’ve partnered with over 350 individuals and early teams, cultivating a diverse portfolio of 35+ startups. Our mission is to support founders every step of the way, from Day Zero to Greatness. Taking this commitment further, we’re introducing the ARC—a groundbreaking venture deal structure tailored for Canadian founders. This initiative provides greater flexibility, increased capital for execution, and a comprehensive support system to help early-stage startups accelerate their journey to the next level.
Agreement for Rolling Capital (ARC)
The Agreement for Rolling Capital (ARC) is Antler Canada’s new standard investment framework for startups. With ARC, we pledge to invest up to $300K in idea-stage companies on an ongoing basis. The initial funding comes as a $150K pre-seed investment, serving as the team’s first institutional capital, often provided at the concept stage without requiring a product or traction. Within six months of this initial funding, Antler commits to investing up to an additional $150K, matching 50% of the funds raised by the startup from external accredited investors at a new valuation. ARC is designed to help startups rapidly progress from an idea to raising $600K or more within 9 months, offering a founder-friendly approach to minimize dilution.
The core principle of ARC is to provide exceptional founders with the opportunity to secure more capital early on, enabling them to quickly work toward achieving Product-Market Fit (PMF) while minimizing dilution and promoting efficient capital utilization. Our experience has shown a clear link between faster access to early-stage funding and a smoother path to Series A. By bringing valuable stakeholders into the fold, ARC empowers founders to raise to $600k within their first year. This approach builds strong momentum and establishes favourable conditions for securing additional funding at an optimal valuation.
Understanding the Math
For solo founders or early-stage teams entering the Residency or Fast Track programs, Antler Canada offers tailored support to accelerate their startup journey. Established teams with a clear vision undergo hands-on office hours to validate the scalability of their venture, receiving an investment decision within six weeks. After forming a co-founder partnership and demonstrating rapid progress, Solo founders can pitch to Antler Canada’s Investment Committee within 10 weeks. Upon approval, Antler Canada invests $150K for a 10% equity stake on a fully diluted basis. Founders then have up to nine months to utilize the ARC (Agreement for Rolling Capital) to secure additional funding.
Through ARC, founders can raise an additional $450K, combining $300K from external investors and $150K from Antler, at a new valuation. This brings the total funding to $600K within the first year, amplifying the company’s momentum and creating an advantageous setup for future rounds.
Key Highlights of ARC:
- Flexible and Rolling Structure: ARC can be activated on a rolling basis for external funding raised within nine months (excluding friends and family, angels, accelerators, or down-rounds). For example, if founders raise $200K from a micro-VC or syndicate, Antler adds $100K through ARC, bringing the total to $450K. The ARC cap of $150K can be accessed in multiple rounds within nine months.
- Dilutive First Investment: The initial $150K is equity-based (dilutive), unlike MFN structures, and subsequent capital is raised at the updated valuation.
- Instrument Flexibility: Antler adapts to fundraising instruments like convertible notes or SAFEs, ensuring founders have flexibility.
- Ongoing Support: Beyond ARC, Antler supports its portfolio companies through pro-rata commitments in Seed and Series A rounds. Founders also benefit from the Antler Canada Fund and the $285M Antler Global Continuity Fund (Antler Elevate) for sustained backing in post-Series A rounds.
The ARC serves as a powerful tool to accelerate early-stage fundraising while providing founders with robust support for scaling their ventures.Applications are now open for our next cohort that starts on March 31st, 2025
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