Radical Ventures and the rise of Canadian AI

Canada’s standing in the field of artificial intelligence has strengthened recently, driven by substantial institutional capital flowing into the sector. Radical Ventures, founded in 2019, exemplifies how a dedicated AI venture capital fund, backed by CPP Investments, has become deeply rooted in Canada’s flourishing AI ecosystem and strategically positioned Canada as a leader in the AI investment landscape.

This article provides an overview of CPP Investment’s paper, Seeding the Future: Radical Ventures and the Rise of Canadian AI.

The rise of Radical Ventures

Radical Ventures is the brainchild of Jordan Jacobs and Tomi Poutanen, two Toronto based entrepreneurs, whose vision was to establish North America’s first dedicated AI venture capital fund after the sale of their company, Layer 6, to TD Bank in 2018. They have been deeply ingrained in Canada’s AI-related institutions. Their noteworthy contributions include being at the forefront of launching both the Vector Institute and Creative Destruction Lab in Toronto, establishing Toronto as an AI hub in Canada.

The founding of Radical coincided with a pivotal moment for Canada’s AI landscape. While Canadian universities and research institutions had long contributed foundational work in the field of AI, the venture capital infrastructure in this country was underdeveloped. Radical’s goal was to bridge this gap by raising a US$325 million fund, nearly triple the size of the average Canadian venture capital fund at the time, and focus on investing exclusively in AI-related businesses.

Radical Ventures has quickly evolved from a concept to a global presence since its launch in 2019, operating in Toronto, San Francisco and London, with US$2.5 billion in assets under management.

AI investments and venture capital

The AI-focused venture capital space has seen rapid growth, with AI startups capturing 36 per cent of global venture capital funding in 2024, up from 16 per cent in 2019. This translates to a five-year increase from US$54 billion to US$137 billion in AI-specific funding. Amid this boom, Radical faces the challenge of rising valuations of target investees, fueled by market demand, which can make it difficult to maintain disciplined capital deployment. According to Jacobs, Radical

maintains a competitive advantage by being actively involved in shaping the success of the companies it invests in, through the Velocity platform. The Velocity platform provides founders of companies that Radical invests in with access to support for hiring, technology infrastructure and aid in the effective monetization of their developments.

Additionally, the founders also have access to a network of professionals in the industry with business acumen and technical expertise, which serve as key enablers of success in a competitive market. The portfolio of companies seeded by Radical ventures includes ground-breaking technologies. Among Radical’s most notable investments is Cohere, a Toronto-based company specializing in large language models for enterprise. As of 2025, Cohere is valued at US$5.5 billion. Other companies in their portfolio include:

Aspect Biosystems: Uses 3D bioprinting for regenerative therapies

Waabi: Develops AI-powered self-driving trucks

Hebbia: Builds AI agents for legal and financial data analysis

Intrepid Labs: Accelerates drug development using machine learning and robotics

Radical faces the challenge of rising valuations of target investees, fueled by market demand, which can make it difficult to maintain disciplined capital deployment.

Institutional capital flows into AI

CPP Investments anchored Radical’s first institutional fund with a US$50 million commitment, later increasing its total investment to US$280 million.

CPP Investments is one of the largest pension funds in the world with US$421 billion in assets. It backed Radical Ventures due to a longer investment horizon with a mandate that allows for investment in alternatives. CPP Investments views AI as a transformative economic force and a driver for productivity and growth in the long term. CPP Investments recognized the wealth of technical expertise and access to talent networks available to Radical as key enablers in driving innovation and growth in the long term, thus supporting Radical from its very inception. In Canada,

there was a lack of growth-stage capital available for young AI firms to flourish.

Among Radical’s most notable investments is Cohere, a Toronto based company specializing in large language models for enterprise.

Radical bridged this gap by leveraging Canada’s relatively favourable immigration policies and the presence of strong STEM talent in Canada. Radical has also become a strategic knowledge partner for CPP Investments, offering insights into emerging technologies and market trends. Radical Ventures exemplifies Canada’s potential to lead in AI innovation and has positioned Canada as one of the global hubs for transformative technology by building sustainable ecosystems for AI, making strategic investments and forming global partnerships that will pave the way for future entrepreneurs.

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