Mark Attanasio: Hillcrest Merchant Managing Partner Discusses Toronto’s Start-Up Market

As the co-founder of Hillcrest Merchant Partners, Toronto’s Mark Attanasio has a bird’s-eye view of Canada’s flourishing venture capital market. Along with managing partner Donato Sferra, Attanasio nurtures early-stage and mid-market growth companies.

The partners describe Hillcrest Merchant Partners as a “boutique” merchant bank that focuses on a number of industries, including mining, gaming, industrials, and technology. Their services include equity and debt structuring, reverse takeovers, M&A and the private-to-public process.

We caught up with Mark Attanasio to discuss his path to success and to take a look at the world of venture capital.

Can you trace your career path for us?

Mark Attanasio: Well, after I graduated from the University of British Columbia, I started working at PricewaterhouseCoopers. It was incredibly helpful to get first-hand experience in audit and advisory services, while also earning my CPA. After that, I joined National Bank Financial, starting in the Mergers & Acquisitions group, then as a Director of Global Equity Derivatives.
From there, I was hired by Dundee Corporation as Executive Vice President of Merchant Banking, ultimately serving as President of Dundee Capital Markets. I oversaw a portfolio of investments in multiple sectors and managed all aspects of the capital markets business.

What do you enjoy most about your current work with Hillcrest Merchant Partners?

Mark Attanasio: I really enjoy advising businesses at various stages in their development on what it takes to position themselves for growth—whether it’s through traditional transactional activities like management buyouts and mergers and acquisitions—or through a public listing on a Canadian stock exchange. I’ve always had a passion for stock markets and a passion for developing ideas into businesses, plus I enjoy listening to ideas from other venture capitalists and entrepreneurs.

What are some of the challenges you face in your career?

Mark Attanasio: Here in Canada, we seem to lack early-stage venture capital for private companies. I’ve met a lot of entrepreneurs with great ideas, but I don’t think the Canadian marketplace has the depth of true risk capital like that in the United States. So, as merchant bankers, we’ll raise the first round of capital, but the biggest challenge is finding the second or third round of capital—which is crucial. That is what allows entrepreneurs to maintain their business and avoid seeking alternate and often very dilutive financing sources.

What do you look for when investing in a company?

Mark Attanasio: I don’t want to invest in companies that are clones of something already out there, and I am not interested in “me-too” types of products. What gets my attention is someone who has a real solution to a difficult problem. I want to see solid data showing that the addressable market is substantial and that the company would have a first-mover advantage. I also look for industries where institutional capital is flowing and investing. Due diligence is essential and that means I evaluate the company’s founder and leadership. I also want to see a management team in place with solid, complementary skills. At the end of the day, you are really backing the entrepreneur.

Why is venture capital important to the area’s economy?

Mark Attanasio: It takes funding to grow a startup from an idea to a stable enterprise. VCs, whether they’re in “seed-to-growth” mode or they invest in later-stage companies, are a critical funding source that drives the economy. The Canadian VC marketplace has been on a five-year upward trend in both the size and volume of capital investment. That says a lot about the health of our startup community, especially in Toronto, where about half of those funds were invested.

Finally, what can aspiring entrepreneurs do to prepare for the future?

Mark Attanasio: They need to start young and learn all they can about leadership, financing, and perseverance. Technology should play a role in education from high school all the way to business school, given how technology affects every aspect of life these days. In our global economy, most companies need innovations in cyber security and, of course, cloud-based storage. Anyone entering the global workforce without a solid grasp of technology is at a disadvantage, especially with the significant attention that AI and machine learning are garnering from businesses.

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