CIBC Tech & Innovation Market Update – June 2023 – Volume 38

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The information you need to stay up to date on developments within the tech ecosystem.


Canadian technology sector performance and valuationSector Performance and valuation chart: S&P 500 1.2%, S&P 500 Info Tech Index 18.1%, NASDAQ 7.1%, S&P/TSX Info Tech Index 37.5%

EV / NTM revenue multiples 1 LTM sector price performance 1
EV/NTM revenue multiples: High Growth Canadian Saas 4.6x, Large Cap Canadian Tech 2.8x, Mid Cap Canadian Tech 2.3x, Small Cap Canadian Tech 1.7x LTM sector price performance: High-Growth Canadian SaaS 16.7%, Large Cap Canadian Tech (4.7%), Mid Cap Canadian Tech (11.0%), Small Cap Canadian Tech (30.8%)

Source: FactSet and Pitchbook; as at May 31, 2023; in C$ unless otherwise noted.
1 Please refer to the end of the document for technology group constituents.


Canadian Venture Capital market monthly recap 

May 2023

Aggregate deal value


(vs. $1.1B in Apr-23)2
YTD: $3.5B
(vs. $5.0B in YTD-22)3

Number of deals


(vs. 38 in Apr-23)
YTD: 267
(vs. 523 YTD-22)

Avg. deal value


(vs. $36M in Apr-23)2
YTD: $20M
(vs. $15M YTD-22)3

Most active province by value ($/#)


($432M / 24)
YTD: Ontario ($2.0B/130)

Most active province by count ($/#)


($432M / 24)
YTD: Ontario ($2.0B/130)

Most active sector


(76% of funds raised)
YTD: Software (70%)

2 12 deals in May-23 and 7 deals in Apr-23 with no announced values are omitted from deal values.
3 92 deals in YTD-23 and 187 deals in YTD-22 with no announced values are omitted from deal values.


Noteworthy Canadian deals




Lead investors



Software – Vacation Rental Management Software





Generation Investment Management

Peak Power


Software – Energy Management Software

Greenbacker Capital Management



Software – ESG Management Software

Inovia Capital



Software – Commercial Insights Software for Pharma

Threshold Ventures


CIBC Technology & Innovation Conference 11.0

Image of CIBC fireside chat hosted by Daniel Lee with Microsoft Canada President Chris Barry.

On May 24th at CIBC Square in downtown Toronto, CIBC Technology & Innovation Conference (TIC 11.0) brought together some of North America’s top investor minds and technology companies. The day’s events included presentations from 22 public and private corporations, providing an optimistic outlook that the technology industry is successfully balancing operational efficiency and growth priorities amidst the cautious market environment.

During the keynote lunch presentation, CIBC’s Daniel Lee hosted a fireside chat with Microsoft Canada President Chris Barry, who spoke on the topic du jour: ChatGPT, the immense potential of AI, and his views on how moats for AI models can be built with data quality and company brand.


Technology & Innovation in‘sites’ with CIBC Equity Research

T&I ‘Bits & Bytes’


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TIC 11.0 recap – Takeaways from our annual Tech & Innovation conference

This is CIBC’s official recap of the 11th Technology & Innovation conference that hosted 22 corporate tech companies. We’ve highlighted three key themes from our conversation with companies under coverage: 1) Demand environment – the general view was that the demand environment is stabilizing. Presenters noted strong sales funnels and the hope that deals will start to convert at a more normalized rate in the back half of the year. 2) AI – every company spoke about AI in some form, whether as a benefit to internal operations or a potential source of new revenue streams. 3) M&A – there was no consensus view on the M&A valuation environment, although several presenters noted an increase in private companies in need of funding in their M&A funnels. Given current share prices, several companies stated that buying back their own shares was their best use of capital.

Read the full article here.


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Canada’s emerging tech in 2023 – Technology markets on the mend

In our 11th issue of this report, we highlight 52 private technology companies along with the opportunities and challenges they face as global economies slow and they adapt to higher rates and inflation containment actions.

In 2023, the tech sector has started to heal. Public market investors tell us they expect the overall market—including the tech sector—to be higher by year-end. First, select tech segments and related companies have seen their share prices rise on better growth and cash flow prospects. Beyond these business plan pivots, trends in artificial intelligence (AI), cloud, software as a service (SaaS), e-commerce and payments are also contributing to the improvement. Hardware is also selectively doing better. Finally, shareholder activism targeting companies that have underperformed peers over the last three years is expected to garner broader support. Taken together, these factors are positive for an improving technology market in 2023.

Read the full article here.


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Q1/23 Canadian software earnings recap – Key themes from Q1 results

Q1 earnings prints were better than expected for our coverage universe, with average revenue 1% above consensus and EBITDA 5% above expectations as companies continue to focus on profitability. Despite the Q1 beat, consensus F2023E revisions for our coverage were flat on average, with a 0% increase to revenue and 1% decrease to EBITDA. Outliers include QFOR, where Street EBITDA decreased ~13% driven by a weaker-thanexpected Q1, and KXS, for which F2023E EBITDA was revised upwards 8% driven by increased 2023 guidance.

Read the full article here.


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AI frenzy – Generative AI: Risk or opportunity?

Although not an entirely new technology, artificial intelligence has been taking the world by storm in the last few weeks, mainly driven by the extreme rise in popularity of generative AI technologies such as ChatGPT, which is now the fastest growing consumer app, reaching 100 million users only two months after its launch according to news reports. The increasing use of generative AI technologies is creating waves in the market, with companies either indicating that AI advances such as ChatGPT are beginning to impact growth (see: Chegg) or announcing their own development and incorporation of existing AI technologies into their business models (see: Google, Microsoft, IBM). While the impact of generative AI on company performance is still unknown, one thing is for certain — we can’t stop talking about it.

Read the full article here.


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Is big tech M&A dead? – International regulatory reviews slow M&A

Recently, the UK antitrust regulator blocked Microsoft’s $69B purchase of Activision Blizzard, one of the largest potential tech deals in recent years. The Competition and Markets Authority (CMA) released in a statement that it was worried the deal would lead to “reduced innovation and less choice for UK gamers over the years to come”. Microsoft has said that it will appeal the CMA decision, although the appeals process sets a relatively high bar, focusing primarily whether the regulator acted rationally and lawfully. The European Union is also currently evaluating the transaction, and in December, the US Federal Trade Commission (FTC) sued to block the takeover on similar concerns.

The U.S. has historically lagged Europe when it comes to technology regulation, on everything from online news funding to M&A to security and privacy concerns. However, the FTC’s complaint was filed not long after the CMA launched its in-depth review of the Activision deal. In fact, regulatory reviews of large technology deals have been increasing across the US, with the FTC recently attempting to block Meta’s purchase of Within, the maker of a virtual reality fitness app. Although we have yet to see significant US legislative changes, the tone appears to be shifting, potentially setting the stage for additional tech regulation.

Read the full article here.

Recent technology news

“The race to make AI smaller (and smarter).”

The current paradigm in improving generative AI language models is to continually feed it data. One detractor of this way of thinking is that very few companies have this kind of processing power, limiting control of AI technology to the likes of Google, Microsoft, and OpenAI in the marketplace. Further, researchers are finding that as datasets for these language models get bigger, it is making them harder to understand and more difficult to manage. A group of academics has called on teams to create language models using datasets 1/10,000th the size, naming the project the BabyLM Challenge.

Read the full article at The New York Times.

“Business would be over: Canada’s news publishers say ban by Google and Facebook would devastate them.”

As Bill C-18, also referred to as the Online News Act, moves through legislation, some news publishers worry about the potential consequences of big tech banning Canadian news from their platforms altogether, with Meta already conducting a trial run of this for some Canadian users on Instagram and Facebook. Phillip Crawley, CEO of the Globe and Mail recently stated that a Facebook ban would result in a loss of millions of dollars for their business.

Read the full article at the Toronto Star.

“The world is finally spending more on solar than oil production.”

The International Energy Agency recently published its annual report on the overall investment in energy worldwide. In 2022, the total investment in energy was $2.8 trillion. Clean energy accounted for 61% of this total, with companies, research institutions and governments funding $1.7 trillion globally. This $1.7 trillion represents the largest annual clean energy investment on record.

Read the full article at MIT Technology Review.

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CIBC Capital Markets Insights

Leverage leading insights and stay abreast of developments in the markets with CIBC Capital Markets Insights.

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Tech & Innovation Key Contacts

Roman Dubczak
Deputy Chair
Susan Rimmer
Managing Director And Head, Global Corporate & Investment Banking
Kevin Li
Managing Director and Head, Global Investment Banking
Kathy Butler
Vice Chair and Head of CIBC Capital Markets – B.C.
Colin Ryan
Managing Director, Head of Technology & Innovation, Global Investment Banking
Adam Noily
Managing Director, Head of U.S. Technology & Innovation, Global Investment Banking
Daniel Lee
Managing Director, Technology & Innovation, Global Investment Banking
Emilie Bissonnette
Managing Director, Global Investment Banking
Rob Magwood
Managing Director, Equity Capital Markets
Frazer Wong
Executive Director, Technology & Innovation, Global Investment Banking
Mark Usher
Executive Managing Director, Innovation Banking
Paul McKinlay
Vice-President and Head of U.S. Origination, Innovation Banking
Amy Olah
Managing Director and Head of Canadian Origination, Innovation Banking

Canadian Technology Constituents

High-Growth Canadian SaaS – Ceridian, Copperleaf, Coveo, Descartes, Dialogue, Docebo, Kinaxis, Lightspeed, Q4, Shopify, Thinkific

Large Cap Canadian Tech – Altus, Blackberry, Celestica, CGI, Constellation Software, Converge Technologies, Dye and Durham, Enghouse, Evertz Technologies, Nuvei, OpenText, Softchoice, Well Health

Mid Cap Canadian Tech – Absolute Software, Calian, Computer Modelling Group, D2L, Payfare, Real Matters, Sangoma, TECSYS

Small Cap Canadian Tech – Alithya, Baylin Tech, BBTV, Blackline Safety, Farmers Edge, Kneat, Optiva, Pivotree, Quarterhill, Sylogist, Terago, Vecima, Vitalhub, WeCommerce

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