Budget 2025 recognizes emerging fund managers with $1B venture initiative

“To see asset management specifically identified as an economic growth opportunity — that’s new,” said Michael Thom, managing director of CFA Societies Canada in Toronto.

The asset management industry “should feel really seen and heard in this budget,” said Claire Van Wyk-Allan, managing director and head of Canada with the Alternative Investment Management Association (AIMA).

The budget’s use of the term “emerging fund managers,” specifically, is “a material shift in language from what we’ve seen published in the past,” Van Wyk-Allan said. The budget’s wording reflects advocacy language: “We’ve been advocating for emerging fund managers, entrepreneurs in the financial industry, for years now,” she said.

Advocacy efforts to the federal government were stepped up over the past year, Van Wyk-Allan said. And advocacy was formalized in April with the launch of the Canadian Asset Management Entrepreneurship Alliance — a partnership among CFA Societies Canada, AIMA, the Emerging Managers Board and the Portfolio Management Association of Canada.

In introducing the proposal, the budget says that venture funds “drive innovation and are shaping the next generation of Canadian anchor firms and fund managers that will support economic growth and strengthen Canada’s economic resilience.”

The recognition of fund managers “feels like such an opportunity to engage, build and work with the federal government and other stakeholders to make something special,” Thom said. “That alignment between the government and the private sector on mutual objectives feels like powerful substance.”

Creating Canadian champions

The budget proposal is particularly important in the context of consolidation. When it comes to firms that are global consolidators, “there are no Canadian firms on that list,” Thom said. Creating Canadian champion firms requires, in part, “recognizing that we want to compete in that space as a country — that there are inherent economic advantages, and great capital formation and economic sovereignty effects.”

Brookfield Asset Management was the only non-U.S. brand in the global top 16 most valuable asset management brands, according to a 2025 ranking by Brand Finance, a brand valuation consultancy in London. In January, Prime Minister Carney resigned as Brookfield’s board chairman when he decided to run for leadership of the Liberal Party of Canada.

Thom said the budget represents a shift in perspective that “Canada is a place to be called home for the globally relevant asset management complex.”

Overall, the budget aims to enable $1 trillion in total investment from the public and private sectors over the next five years. “The test ahead is execution and follow through — ensuring that policies translate into real-world competitiveness and growth,” the Canadian Chamber of Commerce said in a release on Tuesday.

CAMEA advocates for legislative changes and tax incentives, including new fund-focused structures, to encourage entrepreneurs to start businesses.

One challenge is “we don’t have a harmonized CSA [Canadian Securities Administrators],” Van Wyk-Allan said. “We need to think about reducing those interprovincial trade barriers from a securities administrator perspective, so that we [i.e., Canadian businesses] are easier to work with, both locally and from abroad.”

But addressing policy doesn’t mean a decades-long political process. “The change in tone from the federal government forms a call to action,” Thom said.

Canada has “the talent and resources and operational foundation to see this policy through,” Van Wyk-Allan said, in reference to the budget proposal. She cited firms such as Montreal-based Innocap, a managed account platform for alternative investments, and Finance Montreal, a financial sector hub. Nearly a decade ago, they launched the Quebec Emerging Manager Program (QEMP), which provides funding and mentorship so that new managers can launch and scale.

With the new venture fund, the government can follow QEMP’s lead in incentivizing institutional capital to invest in Canadian asset management entrepreneurs, CAMEA said in a release on Wednesday. CAMEA also highlighted Finance Montreal’s work and suggested the government likewise position emerging managers at the centre of Canada’s economic growth plans.

Van Wyk-Allan further noted that Canada boasts one of the highest numbers of chartered financial analysts per capita, world-leading banks and a world-renowned asset allocation framework for institutional investors in the Maple Model. Fund managers create jobs, driving tax revenue and innovation, she said.

Canada is positioned to “maximize the opportunity of public sector leadership and policy leadership with private sector expertise,” Thom said. “Let’s lessen that distance between Ottawa and the financial capitals across the rest of the country.”

With the new Venture and Growth Capital Catalyst Initiative, the budget proposes “to realign previous venture capital and mid-cap commitments to support access to capital that meets current market needs,” the budget says. Since 2016, the government has invested more than $1 billion in several rounds of the “Venture Capital Catalyst Initiative,” and the 2024 fall economic statement had proposed launching a fourth round in 2025–26.

The government’s cash injection to the newly proposed venture fund would begin in 2026–27, Tuesday’s budget says.

The federal budget also proposes providing $750 million to support Canadian firms facing early growth–stage funding gaps, with details to be announced next year.

In last year’s budget, the government said former Bank of Canada governor Stephen Poloz would explore how to generate greater domestic investment opportunities for Canadian pension funds.