Targeting Local Startup Excellence

This post first appeared on the Real Ventures blog

Two years ago this month, Real launched Orbit MTL, a $31M early stage fund focused on the Montreal startup ecosystem. Since we closed the fund we’ve been busy, investing about $9M in 61 investments across our direct portfolio, two accelerators, and our student VC fund. In this post, I share details about those investments and the strategies behind them, as well as some of the lessons we’ve learned along the way.

Why Orbit?

Every fund is a partnership between investors (LPs) and managers (VCs) but in Orbit’s case the collaboration has been especially strong. For our LPs, Orbit is part of a broader effort to strengthen the early-stage financing chain in Quebec. The largest investor in the fund is the Quebec government. Its investment in Orbit and other regional funds (eg InnovexportEcofuel) attempts to spur economic development by solidifying support for early-stage companies. Orbit’s other institutional investors — CDPQFSTQ, and Desjardins — all hold important positions in Quebec’s technology sector and are committed to its growth. Orbit is also backed by Montreal-based founders and investors, many with strong connections to Real, who believe in paying it forward to the next generation.

For Real, Orbit is an opportunity to continue pursuing ecosystem-focused investing, a hallmark of our firm since it was founded, even as our other funds move upstream in the financing chain. As in past Real funds, Orbit combines acceleration, high-volume seed investing, and community collaboration to create unique deal flow and networks of support. What’s new is the level of focus, including: dedicated partners, a separate investment process, and a hyper-targeted mandate. By forming a discrete team that hones in on a single ecosystem, we aim to do even more to catalyze startup activity — creating new platforms, building investment syndicates, and attracting outside capital.

Who we are

Orbit is led by two partners, Sylvain Carle, a serial entrepreneur with deep ties to the Quebec startup ecosystem who joined Real in 2014, and me, Isaac Souweine, who joined in 2017 following stints leading product management at Real portfolio companies Frank and Oak and Sonder. We are supported by Laura Easton, a McGill alum with a background in market research and our Founderfuel program manager, Sarah Bezeau, who joined us earlier this year from GSoft. Orbit’s investment committee also includes two external members: Pascale Audette, CEO of Carebook, and Francois Laflamme, Senior Partner at Novacap. Both have helped enormously in adding rigour and perspective to our investment decisions. Finally, the Orbit team leans heavily on Real’s back office team, especially Lauren Jane Heller on comms, Steffie Vincelli on finance and Ziyi Shi on legal.

Direct investing

Orbit’s primary investment strategy is to participate directly in early stage financing rounds. Since the fund launched, we‘ve made 21 such direct investments.

As with Real’s larger funds, Orbit prefers to lead or co-lead rounds; so far we’ve played that role about half the time. Leading rounds takes more work — in due diligence, negotiation, and syndicate building. Yet in our view, the payoff is worth it. As lead investor we find we develop stronger relationships with founders while gaining increased influence on terms and round construction. We also believe that leading pushes our investment team to think more independently.

Orbit’s average investment size so far has been ~$220K. Unlike Real’s larger funds, the rounds we join are all syndicated; the highest proportion of any round that we have taken has been 50%. The full range of round size and pricing has been wide, but most rounds have been $1M or less, priced between $3M-$5M pre-money. Investments have been equally split across equity and convertible instruments, mostly SAFEs. Our co-investors include other funds and angels from Quebec, Ontario, and the United States. We’ve also made four investments alongside Real’s main seed fund; these are typically larger seed rounds, such as our co-investment into Breathe Life, a company founded by Ian Jeffery, the first GM of FounderFuel.

Like any regionally-focused fund, Orbit MTL seeks to invest in areas of local excellence. In Montreal, AI projects are at the top of that list, and we’ve made a number of investments on that theme, for example:

  • Omnirobotic makes industrial painting robots guided by machine vision. Founded by Francois Simard and Laurier Roy, both experienced roboticists, we co-invested in Omnirobotic with Element AI, the AI solutions provider seeded and co-founded by Real.
  • Korbit AI is transforming online education using natural language processing. Founded by Iulian Serban, a student of Yoshua Bengio, we backed Korbit alongside strong Bay Area co-investors who shared our interest in investing in Montreal’s AI community.
  • InVivoAI uses machine learning to accelerate drug development in low data environments. The company’s co-founders, Dan CohenTherence BoisPrudencio Tossou and Sebastien Giguere, work at the cross section of AI and computational biology. The company is backed by a strong group of Canadian early-stage investors.
  • Keatext provides AI-powered text analytics for feedback interpretation. Co-founded by Narjes Boufaden, another student of Professor Bengio, and Charles-Olivier Simard, Keatext has been in the Real Ventures family since 2016 when the company completed FounderFuel.

Orbit has also found a number of opportunities to invest in technology generated by Montreal’s world-class universities. Some examples include:

  • Sollum, which builds programmable LEDs for agriculture and beyond. Founded by Francois Moisan, Gabriel Dupras, and Louis Brun, Sollum combines unique IP and technical expertise from ETS with an experienced founder on his fourth startup. The company is supported by a strong contingent of Quebec angels.
  • Spark Microsystems, which builds short wave wireless radios that seek to replace Bluetooth. Founded by Fred Nabki and Dominic Deslandes, Spark leverages their years of research at UQAM and ETS. Orbit led the investment into Spark alongside Real’s main seed fund.

While portfolio themes like AI and deep tech have emerged, Orbit has remained sector and technology agnostic, making investments in SaaS, marketplaces, consumer, real estate, cyber, aerospace, and more.

Accelerator investing

Orbit also invests via Real’s accelerator, FounderFuel, which has been operating its three-month, mentor-driven program since 2011, backing category leaders like, and Mejuri. FounderFuel is a huge asset for the fund, providing an established network and a brand that not only attracts top young startups from Montreal but also enables us to recruit companies from across Canada to participate in the local ecosystem.

So far, Orbit has made 23 investments through FounderFuel across three cohorts. You can check out all of the pitches here. Applied AI has been a strong theme in each cohort, but we’ve tried a bit of everything, including lots of SaaS, hardware, robotics, tech-enabled services, health tech, and more. We’ve also continued to use the program to develop our own expertise. For example, Sam Haffar’s posts on raising Series A and mine on building fundraising stories were both workshopped in FounderFuel.

Like all of our investment strategies, FounderFuel is designed to create reinvestment opportunities for Real/Orbit. So far we are on track, having doubled down on five companies, including Invivo AI, discussed above, and four others:

In 2019, Orbit MTL also finalized a major strategic investment in Techstars AI. Techstars is a dominant global player in acceleration, with nearly 50 programs running across the globe and one of the world’s strongest startup networks. Investing in a second accelerator was not part of Orbit’s original mandate, but when the opportunity arose to bring a Tier 1 global player to Montreal, we worked with our wonderfully supportive investors to make it happen. Orbit’s investment in Techstars AI deepens our longstanding relationship with Techstars, building off the structure created when Real co-invested in Techstars Toronto,

In late 2018, Techstars AI made its first 10 investments under the leadership of successful entrepreneur Bruno Morency, with Justine Marchand running programming. We are thrilled about the program’s ability to support strong local AI companies like Arctic Fox AI, which uses AI to better diagnose brain illnesses and to bring leading startups to Montreal from around the world, and Green-eye (Israel), which uses machine vision to reduce herbicide usage.

Student VC

Finally, Orbit has made 9 investments through Front Row Ventures, our student fund. Inspired by programs like Dorm Room Fund, Front Row seeks to inject a venture capital mindset into university communities by empowering students to invest in their peers. We met Front Row’s three precocious founders — Eleonore Jarry-FerronNicolas Synnott and Raphael Christian-Roy — before our fund closed and were thrilled to partner with them, providing $600K of capital to support 24 investments over four years across Quebec. Since launching, FRV has trained more than 50 young investors across three cohorts. These student investors have built a strong portfolio with a special flare for deep tech, including: Reaction Dynamics, which provides launch services for satellites, Enuvio, which builds ‘lab on a chip’ technology for life sciences, and Nplex, which uses nanotechnology to improve protein screening in blood tests.

We believe that Front Row Ventures will be one of the next great platforms for Canadian founders and investors. Front Row Ontario kicked off this past spring; by 2020 we plan to launch chapters across Canada backed by a pan-Canadian fund.

What we’ve learned about Montreal

1. It’s a great time to be a startup in Montreal

After two years on the front lines, we are enthused by the level of startup activity in the city and the quality of talent and support for young companies. Montreal’s universities provide a powerful engine for startup growth, creating massive amounts of intellectual and human capital, especially engineers, data scientists, researchers, and creatives. Montreal founders who take the plunge are well served by incubators and pre-accelerators including CentechD3Next AICDL MTLFounder’s InstituteMTLabX-1La Piscine and many more, as well as a robust calendar of meetups and a strong set of community organizers. On the funding side, Quebec and Canada both support companies aggressively with grants and subsidies (SRED, IRAP, MESI, La Main, etc.), with many companies raising more than $1 of non-dilutive funding for every $1 of equity. Low salaries and rent allow companies to extend runway even further. In addition, Montreal is starting to see both material exits/IPOs — e.g., Luxury Retreats, Lightspeed — and a growing crop of scale ups — e.g., Element, Hopper, Breather, SSENSE,, and Alaya Care. These companies help attract and train talent while providing inspiration for the next generation of founders.

2. Montreal needs more early-stage capital

The falling cost of company creation and growing embrace of startup culture have led to a global boom in startup activity — and Montreal is no exception. But while the supply of startups has never been higher, and while support from many quarters has never been stronger, local capital has been slow to keep pace. Most Canadian private wealth is tied to traditional industries like resources and real estate. For many Quebec investors, the technology sector is considered high risk and historically underperforming. Pension funds and government have made significant efforts to bridge the gap, but Montreal lacks capital depth compared to Toronto, and the difference is starker when compared to similar-sized US cities, to say nothing of the Bay Area/Silicon Valley. Things are slowly improving. In the last few years, firms like Panache, Innovexport, and Ecofuel have raised early stage funds and begun actively leading financing rounds. But in aggregate, Montreal remains a buyer’s market, with many fundable companies struggling to raise VC rounds locally.

3. Montreal founders should broaden their fundraising horizons

Canadian startups are often told to think bigger in terms of their business ambitions. While we agree with this advice, we also believe more ambition is required on the fundraising trail. Given the lack of local capital noted above, we believe Montreal founders should broaden the scope of their fundraising efforts, looking across Canada and the US to source investors. Seed investing will always have a local tilt, but Canadian startups have proven their potential for global success and, given pricing pressure close to home, US investors are more willing than ever to make early-stage bets north of the border. If Montreal founders do their homework and hustle, they can find financing partners outside of their home market. Further, engaging outside of the ecosystem is often the best way to get local investors more engaged.

What we’ve learned about early-stage investing

1. Acceleration won, and now it’s everywhere

When Real started FounderFuel in 2011, acceleration was gaining steam as a key link in the financing chain, but access to high quality programs was limited. Fast forward eight years and acceleration is everywhere! At the top of the market are a small group of global winners — e.g., YCTechstarsSOSV — that have achieved scale. These firms invest in hundreds of companies a year, recruit and operate globally, and build powerful networks supported by large pools of capital. Verticalization has been another boon to the movement — specialist programs now exist for everything from enterprise SaaS to aerospace, with the top vertical players also building strong global brands and networks. Corporates have also moved full force into acceleration, pushing in cash and corporate attention and pulling in a new group of service providers to build their programs.

At Real, our work on FounderFuel has given us a front row seat to this evolution and we’ve embraced it, partnering with Techstars to create two programs — Techstars Toronto and Techstars AI — that combine the best of Techstars’ scale and networks with our local connections and expertise. Our partnership with Techstars ensures that we are deeply integrated into programs that will be linchpins in our key investment ecosystems. The partnership also inspires our own acceleration work, giving us a chance to learn new techniques and apply best practices from a global leader.

2. Platform thinking is on the rise

Investment platforms create unique bundles of value for founders, spurring company formation while creating structural advantage for platform creators. Real’s work on FounderFuel has shown us the power of platform-based investing and our collaboration with Techstars has exposed us to platforms at scale. But as we look across Montreal, we are impressed to see that platform thinking is becoming widespread. For example:

  • Diagram has built a platform based on Power Corp’s business networks, strong in-house support teams and access to capital
  • TandemLaunchmatches talent to university IP, forming companies that it then connects to a network of corporate funders/buyers
  • Centech’splatform is based on office space, programming, corporate access and a community of deep tech founders

As venture investors, we are happy to see strong platforms generating unique companies that we can invest in. As a platform builder ourselves, the creativity of others pushes us to keep innovating and looking forward.

3. Ownership targets, even at pre-seed

When we launched Orbit, we attempted to be highly programmatic, picking an investment amount ($250K) and sticking to it no matter the pricing or round size. The idea was to keep things simple and spread risk evenly, and in that sense we were successful. But as we looked at more opportunities, we realized that being dogmatic about cheque size was constraining us. For higher priced rounds, $250K did not secure enough ownership to be meaningful for our financial model; on the other end of the spectrum, for some small pre-seed rounds, $250K was more than necessary. After some trial and error, we have pivoted to a more flexible approach. We now invest a range of $150K — $350K into each company and we set minimum ownership targets to help guide the amount we choose as well as the round pricing.

Looking ahead

As we look ahead, we feel energized to continue our work on Orbit — supporting our current portfolio, making new investments, engaging with our thriving ecosystem, and building stronger bridges globally. We are also excited to work with the entire Real team to explore new ways to support founders, especially in terms of leadership development and personal growth. Finally, we believe Orbit’s strategy of hyper-focused, highly networked early stage investing is widely applicable, so even as we deepen our commitment to Montreal, we’re looking forward to exploring other ecosystems that might be a fit for the Orbit model.

Building your fundraising story

Sarah Jenna, CEO of My Intelligent Machines, pitching at FounderFuel Demo Day

At Real, we believe a company’s story is the linchpin of their fundraising process. In his posts on the path to Series A, my partner, Sam Haffar, makes a strong case for the central role that story plays in securing financing. Sam’s posts also touch on our specific techniques for story creation. In this post, I dive deeper into those techniques, unpacking the methods we use at Real and our venture accelerator, FounderFuel, to support our founders in crafting their fundraising stories.

Story Matters

Before plunging into the details, the theme bears repeating: your story is key! At one level, this maxim is true for many things in life. Whether you’re a politician or a product developer, a compelling story is essential to success. But story is especially important for early-stage startups because there is usually very little hard data to share with investors when they pursue their first financing rounds. Even for startups with early traction, most of their path lies in the future. In the absence of data, investors have little choice but to lean heavily on the story of what’s to come.

Story is a powerful heuristic for other reasons. For one thing, it’s widely available: any founder can and should have a well-honed story. It’s also easy to consume: an investor can get a good feel for a founder’s story within 15 minutes — even less if we get a deck in advance. Perhaps most importantly, the ability to craft and tell a great story is often correlated to success in fundraising, and in other important domains such as inspiring teams, building partnerships, attracting acquirers and impressing journalists.

For those who find this emphasis on story unsettling in a Theranos sort of way, it’s important to note that in a well-run investment process, the story is necessary but not sufficient. When an investor finds a company’s story compelling, they start a due diligence process. This process — in the form of market research, reference calls, financial model review and more — is meant to either validate or disprove the story they’ve heard.

Building your story

At Real, we think of a company’s story as a single argument that plays out across multiple modes. Whether compressed into an email blurb or zoomed out into a partner pitch, the story is a coherent set of ideas about how the company can achieve its grand vision.

While the story can be told in many forms, arguably the most important is the fundraising deck, a pithy set of 10–20 slides that summarizes the company’s vision, track record and plan. At Real, we embrace the deck as a form of communication, but the most important advice we can give about deck-building is don’t start with the slides. Presentation software is great for creating a beautiful final product that mixes words, images, and graphs to just the right effect. But before the deck comes the argument, which is an exercise in rhetoric. To build the argument, you only need words — anything more is a distraction.

Now, you might expect me to propose a Google or Word doc as your starting point, but in our experience, the best tool for script-building is a spreadsheet. The cell-based interface of spreadsheets forces you to chop your argument into small pieces and makes it easy to move those pieces around. The line and column numbers also come in handy when discussing the script, and we love how column width can be used to enforce brevity, as great arguments are as much about what you leave out as what you put in.

Our preferred format for script spreadsheets has two columns. The first column is for the main argument; it should take up ¾ of the page on your screen. The second column is for overflow: ideas, phrases and content that have not found a home in the main thread.

In building the main argument, we think about chaining together sections consisting of a bold claim and supporting evidence. For each section, the bold claim appears at the top. Below this are no more than 3 lines to support the claim. Here’s an example of a single section from Sollum Technologies:

In crafting your bold statements, try to focus less on wordsmithing and more on argument building. What is the key point you want to make? Does that point flow clearly from the previous section? Does it lead easily to the next? For the supporting evidence, focus on making sure each line directly supports the bold claim. If you can’t fit a bold claim or supporting point in the main flow, toss it in the second column for later. Once you’ve got a solid structure, you should start honing in on each line, word and statistic to make sure it is carrying weight.

Care > Believe > Join

Every story has its own flow, and great storytelling is about finding what works for you. That said, it can be helpful to have a framework for what to include and in which order. One rubric we’ve found useful is to build the story around three questions:

  • Why should they care?
  • Why should they believe?
  • Why should they join?

Care is about convincing someone that your company is interesting and potentially lucrative (i.e. capable of returning the fund). The care section is where you explain the core problem you’re solving, the insightful solution you’ve found, and the size and timeliness of the opportunity. We like to see this part of the argument early on in the story, because if an investor doesn’t care, they are unlikely to dig any deeper.

Believe is about convincing someone that you have the team, technology and strategy to win in your market.The believe section is usually the longest in any company story. All of the juicy details from traction and IP to marketing plan and product details go here. We find the believe section is the most straightforward part of the narrative to craft; it’s the part of the story where your main job is to tell it like it is.

Join is about giving someone a clear opportunity in which to participate.For investor decks, the join section is where you get into the details of the fundraising offer, terms, timing, etc. It’s also where you convey fit with the investor. This section is usually the shortest part of the story and often comes at the end.

If you find this structure useful, we suggest you add a third column in your spreadsheet so that you know which question each of your bold points is speaking to.

The Story Pipeline


Given the tools and techniques above, some founders can open a file and start writing. If you need more inspiration before setting off, brainstorming exercises are a good place to start. One tool we use is called burning questions. The idea is to respond to a series of writing prompts, like “Why will your company win?” or “How will the world change if you become a billion dollar company?” The exercise allows you to take a fresh look at your business and the responses can be mined for the first draft of your script. In-person brainstorming sessions with investors or advisors can also be extremely useful to get the creative juices flowing.


Once you have enough raw material, it’s time to get down to the hard work of writing your story. For this phase, our main recommendation is to budget adequate time and attention. Writing is hard work and it’s less gratifying in the short run than replying to emails or crushing your to-do list. So block your calendar, find a peaceful place, and stick with it. We also recommend that you keep your drafts in spreadsheet format as long as possible, both during the initial writing process and early rounds of feedback. Spreadsheet scripts are easier to change than decks, and easier for others to review and respond to.

Rough deck

When you are ready to move from script to deck, it’s important to be flexible about how you turn each section of your script into slides. In some cases, one section of the script (bold claim plus evidence) will map to a single slide. In other cases, it might take a few slides to make that same point. Similarly, some words in the script will be transposed directly to the slide, while in other cases, you may find different phrasing or non-linguistic ways to make the point. Presentation software gives you lots of tools — make use of them! If you are raising meaningful amounts of capital and have the budget, we also recommend hiring a graphic designer to make the story shine.

Final deck

Once your deck structure and wording are in place, its time to add some polish. If you have the budget, we recommend hiring a graphic designer for this phase. We also recommend creating multiple versions of the deck — one shorter one for sending via email and one longer one for in-person meetings. Along the same lines, you should build up a small library of appendix slides that dive deeper on key points. For key investor meetings, you can also personalize the deck slightly by adding a slide about investor/founder fit.

Putting in the work

Like anything worth doing, building your company story is worth doing well. This means investing time and effort. During FounderFuel, we spend 6 solid weeks honing a 5-minute version of the company story for our Demo Day. Our seed-stage companies require less hand-holding than those in the accelerator, but they take a similar amount of total time to craft their stories and decks, as the expectations for quality and depth of thought to raise an institutional A round is extremely high.

Over to You

While these tools will forever be a work-in-progress, we’ve found them useful at Real and FounderFuel and hope you will too. If you want to give our spreadsheet scripting approach a try, here’s a template you can use. If you are working on a new business and would like to share your story with us, we’re all ears. And if your company is at the accelerator stage, applications for the next FounderFuel cohort will be open in early 2020.

The techniques in this post were developed over many years by the Real Ventures and FounderFuel teams. Special credit due to John Stokes, Sam Haffar, Ian Jeffrey and Sylvain Carle for their contributions to developing this approach.p