Capital for Aboriginal Prosperity and Entrepreneurship program established to support First Nations
Paul Martin says Canada's top CEOs interested in fund to build aboriginal business
March 11, 2009
TORONTO — A new $50-million fund to build aboriginal business and entrepreneurship has some of Canada's top chief executives and business leaders pledging their support, former prime minister Paul Martin said Wednesday.
Loans are being distributed through private equity firm CAPE Fund Management Inc., with a goal of creating or growing businesses that will be profitable and benefit aboriginal communities.
The Capital for Aboriginal Prosperity and Entrepreneurship program also has a mandate of putting aboriginals in management positions of the companies involved, and eventually having those businesses completely owned and controlled by aboriginal communities.
"This is not charity, this is investment," said Martin, who spearheaded the project with his son David.
"It provides a financial return but it also provides a social return, which is the principal thrust of what we want to do here."
In a statement, Assembly of First Nations Chief Phil Fontaine said the fund represents an "incredible opportunity" to create and promote economic independence.
"First Nations want to be active participants in Canada's economy and the CAPE fund will help us achieve that goal," Fontaine said.
Business leaders were told that although aboriginals are the youngest and fastest growing segment of the population they're being denied access to mentorship, opportunities and entrepreneurship, Martin said.
"We've got to do something about that."
Every company that was approached about the fund agreed more opportunities need to be extended to aboriginals, and most said they wanted to be involved, Martin added.
Canada's major banks along with Barrick, Manulife Financial, Standard Life, Sun Life Financial, SNC Lavalin and Teck are among the 21 companies that have signed on to invest.
"Right across the board, the heads of the largest corporations in this country said they were not prepared to turn their backs on young aboriginal Canadians," Martin said.
"I've never been prouder to be a Canadian."
Investments are expected to range between $1 million and $7.5 million to fund seven to 10 projects. Decisions will be made based on what ideas can generate the best financial and social returns.
The fund's managing director, Peter Forton, said the program reflects an emerging era of socially responsible investing and it's hoped the model will be emulated.
"One of the very important things for this fund, in terms of our overall objectives, is we want to prove this model works. This is a really innovative model in Canada," he said.
The sagging economy isn't likely to be a negative factor in identifying profitable plans and may actually represent good timing, Forton added.
"If you look at the history of venture capital and private equity investments in this country you will find the best performing investments arise out of funds that were created in times of economic downturn," he said.
Martin agreed, noting it's "better to do it at the bottom of the curve than the top."