Venture capital activity in Quebec declined in the third quarter, though the Quebec Venture Capital Association says investment levels in the province are proving resilient in a North American context.

Investments made by the Quebec industry totalled $167 million in the third quarter of 2002, down 16% from the $198 million invested in the second quarter. In comparison to the third quarter in 2001, during which $250 million were distributed amongst 131 companies, industry disbursements decreased by 33%. But this decrease is lower than that experienced by Canada and the United States, says the QVCA, which recorded declines in venture capital disbursements of 46% and 49% respectively, compared to the third quarter of 2001.

A total of 94 Quebec-based companies received financing in this period, also down by 11% from the 106 firms recorded three months prior. However, the average size of venture capital investments remained relatively unchanged, standing at $1.8 million compared to $1.9 million in both Q2 of 2002 and Q3 of 2001.

During the third quarter, Quebec-based companies obtained 35% of total Canadian capital flows. This is well in excess of the 25% share that Quebec has typically obtained in recent years, says the QVCA. Quebec also continued to lead the Canadian industry in the number of venture-backed firms, with 51% of the national aggregate. The Greater Montreal area received an overwhelming proportion of disbursement streams, with local firms securing $135 million.