Diagram Ventures has raised $55 million in the close of its second fund, earmarked for creating and investing in early-stage companies focused on innovation in the financial and insurance sectors.
Fund II exceeded its $50 million target with the help of anchor investor Portag3 Ventures, which is backed by Canadian holding company Power Corp.
It was joined by 75 angel investors, including Andreessen Horowitz General Partner Angela Strange and former U.S. Ambassador Bruce Heyman, as well as family offices.
Led by CEO François Lafortune, Montréal-based Diagram also announced the hire of Hamnett Hill as a partner. Hill, a serial entrepreneur, co-founded Smooch Technologies, acquired last month by Zendesk.
Diagram’s $30 million debut fund invested in five companies.
Photo: Hamnett Hill, partner, Diagram Ventures.
(This post was updated to clarify the relationship between Portag3 Ventures and Power Corp.)
Diagram announces close of $55-million second fund and adds Hamnett Hill as Partner
Montreal, June 11, 2019 – Diagram Ventures (“Diagram”), a venture-builder that co-founds companies that pursue big ideas in the financial and insurance sectors, today announced the successful close of a new, $55-million second fund (“Fund II”) and that serial entrepreneur Hamnett Hill has joined the platform as a Partner.
Diagram teams up with experienced entrepreneurs to build technology companies pursuing big ideas in the financial and insurance sectors. By combining venture capital investment, incubator-style support and access to a unique ecosystem, Diagram helps founders focus on what they love, removing barriers and speeding their path to success.
“With the support of our anchor investor, Portag3 Ventures, Diagram has rapidly gained a strong level of investor interest both in Canada and internationally, leading us to exceed our initial fundraising target of $50-million in less than six months,” said Diagram Co-Founder & CEO, Francois Lafortune. “We are thrilled and honoured with the quality of investors in our second fund. This is a reflection of the quality of the entrepreneurs Diagram has attracted and the success of the companies we co-created with them. We look forward to partnering with more founders to build billion-dollar global companies based in Canada.”
Diagram’s $30-million first fund has made investments in five up-and-coming companies to date: Dialogue, Collage, Breathe Life, nesto, and dfuse, and the early results of Diagram’s venture co-creation model are promising. In less than 3 years, Diagram’s portfolio companies have created more than 250 full time jobs and combined enterprise value in excess of $175m.
“Dialogue’s growth is proof positive that the Diagram model works,” said Cherif Habib, co-founder and CEO of Dialogue. “From the day we began operations, the full support of the Diagram ecosystem — its founder-centric model, access to its network of LPs and large incumbents and the support services offered by the Diagram team — has allowed us to scale rapidly and become Canada’s leading virtual health provider in three years.”
Among the Limited Partners in Fund II, which includes 75 angels and family offices, are: Ambassador Bruce Heyman, the former United States Ambassador to Canada and a former Partner at Goldman Sachs; Angela Strange, a General Partner of Andreessen Horowitz; Andrew Chisholm, the former Head of the Financial Institutions Group at Goldman Sachs; Charles Goldman, the President and CEO of AssetMark and the former President of Institutional Platforms at Fidelity Investments; Mark Britto, the Executive Vice President Global Sales and Credit at PayPal; Nicole Junkermann, the Founder of NJF Holdings; Anatol von Hahn, the former Group Head of Canadian Banking of Scotiabank, and Henri de Castries, the former CEO of AXA Global.
“Diagram is a key component in our broader strategy to invest in the next generation of global financial services platforms,” said Paul Desmarais III, Co-Founder & Chairman of Diagram. “The number of international investors in Diagram’s second fund has more than doubled and we expect this will create substantive benefits for our portfolio companies as they expand internationally. My personal commitment to Diagram is unwavering because I have full confidence in the team and that the model works.”
Diagram also announced that Montreal-based serial entrepreneur, operator, and investor Hamnett Hill will join the platform as a Partner.
“Hamnett’s decision to help build Diagram is a vote of confidence in our model. He will be a tremendous thought partner to our founders with his outstanding 20-year entrepreneurial track record. He’s seen it all!” said Dan Robichaud, Managing Partner of Diagram.
Hill, an investor in Diagram’s first fund, co-founded TotalNet, one of Canada’s largest early Internet Service Providers (ISPs); Zero-Knowledge Systems, a high-profile pioneer in online privacy and security; Radialpoint, North America and Europe’s largest Telco & Cableco consumer SaaS provider, and most recently Smooch.io, the leading B2C omnichannel messaging software provider, which was recently sold to Zendesk (NYSE: ZEN). Exits of companies he has invested in, founded, or run reach into the several hundreds of millions of dollars. He was also the first and largest investor in Goodfood Market Corp. (TSX: FOOD) and sits on the company’s board of directors.
“Diagram’s unique, entrepreneur-focused model and the success it has enjoyed so far drew me to the platform,” said Hill. “I have yet to see anything else like it and I believe this formula represents the way forward to create the next generation of Canadian-based global businesses in the financial technology sector.”
Diagram Ventures creates companies that pursue transformational innovation in the financial and insurance sectors. Diagram combines venture capital investment, incubator-style support and competitive advantages of large incumbents into a unique, entrepreneur-friendly model. Together with experienced entrepreneurs, Diagram creates innovative businesses that are vetted by a network of industry leaders. Unlike traditional VCs, Diagram co-founds and finances the early stages of a new business, then works side-by-side with founders to help speed up their path to first customers and secure additional funding while offering them best-in-class services that accelerate their growth and allow them to focus on what they love. Diagram is backed by Portag3 Ventures, a leading global fintech-focused venture fund, and a group of more than 75 angel investors. To learn more about Diagram, visit diagram.ca.
For further information: Adam Daifallah, 514-316 7089, [email protected]
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