Investment play: The benefits of being first

At BoxOne Ventures, cleantech investment lead Felicity Meyer is constantly scouring scientific literature, so that when the right opportunity comes along, she “can just strike.”

Montreal’s startup ecosystem has been shaped in no small part by Arvind Ramanathan and Josh Felker, co-founders of Vigilant Global. Launched out of Ramanathan’s mom’s apartment in 2005, the trading firm grew to become one of the city’s most successful trading firms before it was acquired by DRW. Reinvesting back into the city that fostered their own entrepreneurial journey, however, had long been a priority for them. Two years before that huge exit, in 2010, they founded BoxOne Ventures, an investment firm geared to support early-stage startups in life sciences, climate and food tech.

As a family office, BoxOne is structured differently from traditional venture capital firms. Whereas VCs raise capital from limited partners and must deploy it within fixed fund timelines, family offices invest their own wealth. This allows BoxOne to move with far greater speed and flexibility, placing early and sometimes risky bets while also supporting founders over the long haul. In many ways, the approach reflects Ramanathan’s and Felker’s backgrounds in high-frequency trading, where success depended on making decisions faster than anyone else. Even the firm’s name, BoxOne, comes from a term they used during their Vigilant days to describe being the first to invest.

By staying rooted in Montreal, they have become more than just investors: they are ecosystem builders. They started here, scaled here and chose to channel their capital back into the community. As early investors, they are able to anchor startups locally and help strengthen the city’s growing reputation as a hub for science-driven innovation. Some of these great bets include Dispersa, Opalia and Sollum.

It was this fast pace and willingness to take risks that drew Felicity Meyer to BoxOne. With a background in chemistry and physics and early experience as the first hire at multiple startups, she’s able to provide hands-on support — both technical and entrepreneurial — for founders. Today, as BoxOne’s investment manager for cleantech, she channels her passion for “weird, cool science” into identifying promising technologies and working closely with entrepreneurs.

How does a family office differ from a traditional VC fund?

One of the biggest differences is flexibility. With a family office, we don’t need to pitch a strategy and then be locked into it for 12 years. Our place is to not put pressure on short-term gains. Short-term success can often mean making decisions that aren’t beneficial to the long-term viability of the company. Very often, using our networks, we try to get a few other family offices around the table so we can have a balance of perspectives. So, how can you scale as fast as possible and let’s also think about what this looks like 20 years from now, not five years from now.

How do you make sure you’re ahead of the curve?

I read scientific literature on a weekly, if not daily, basis. We’re always looking for interesting and cool ideas that are not investable yet. If there’s that sparkle of something that is interesting, we want to make sure we’re following that trail and ready to act when something is ready to start building. Beyond that, we’ll reach out to scientists and say, “Hey, this thing is really cool, what do you want to do with it?” which is a huge risk in itself because they don’t teach scientists and engineers to be entrepreneurs. Part of our mission is to identify someone who has all the characteristics to be a good entrepreneur but doesn’t know they want to do that yet. It’s a pairing of that trading mindset with VC where you have a strong strategy and a deep technical understanding, so when a good opportunity comes you can just strike.

Clearly, family offices can play a unique role in early-stage investing. They can move quickly because they’re deploying their own capital, take on risks that other traditional institutions often can’t and even help create new entrepreneurs. From your perspective, how are family offices shaping the broader investor landscape in Canada?

There are plenty of family offices that are doing very interesting things. They’re just quiet because they’re smaller teams. It’s really just a matter of changing the perception. Something that we’re all working on is getting rid of this risk aversion. That spans any profile of investor that wants to do early-stage investing because you have to have a pretty healthy risk appetite. Not everyone has the same kind of financial structure that we have. We never have to lead or follow. It really depends on the dynamics of the round. Our goal is to stay with the founders as long as they need. So, we’ll typically maintain our investment. Sometimes we look like a technical lead even though our cheque isn’t the biggest. Sometimes there’s not even a formal round going yet. We do support our networks. We will put together due diligence support for other investors and be a technical soundboard.

What do you look for in a founder?

At the end of the day, it’s about being able to tell a story, raise capital and execute the plan. We’re also attracted to deep technical understanding. The overlap between those two is where you find great investments. Our job is to help you get the rest of the support you need, but you need to be a magnet for people who are going to help you on that journey. That intangible magic really matters.

Can you share an example of what stood out in one of your investments?

Dispersa is a great example. When we invested, there were only two other players in biosurfactants, both using palm-derived ingredients. Dispersa was the only one using waste feedstock, which gave them a real advantage. Surfactants are everywhere — in personal care, home cleaning, even food — but most big chemical companies aren’t innovating. Dispersa had figured out something no one else had. Add in Nivatha Balendra’s relentless energy as a founder and it was an easy decision. It was the perfect storm of something technically very cool and someone that I could trust to figure this out at all costs.

How hands-on are you once you’ve invested?

We let founders decide how much of us they want. If they know the best use of their time isn’t with me, I’m not going to impose. But often it’s the opposite. With Dispersa, Niv was in our lab almost every Tuesday in the early days. Now that they have a big fancy lab, Niv comes in a little bit less. Opalia is a funny example. I used to create lab layouts and update electrical schemes for architects in the past. For Opalia, I annotated their lab layout to make sure they wouldn’t lose power on incubators. I still love the science side and would put on a lab coat if they let me. Whatever they need, I’m down to help.

With your technical background, how do you judge if something is a product or just “cool science”?

Honestly, it’s tough. I’ve seen 10 reports with completely different growth rates for the same market. I think it’s understanding the spaces and understanding where a product could fit in. I’m focused on food, agriculture and energy. Agriculture alone accounts for massive emissions and water use — and everyone on the planet eats, so it’s a big market. We try to look at the competitive landscape. Are there companies that are working on the global scale looking for a solution in this space? I always have a few targets in mind. So if you want to go public, here’s five companies that could probably acquire you for a very big exit. I try to triangulate between that and see if there are enough people that could pay for the product.

Do opportunities come to you, or do you actively search them out?

Our internal ethos is: Identify a good opportunity and act on it before anybody else. By now, people know what I’m interested in and send things across. Sometimes we’ll make an investment within a week if the opportunity is right. We also spend time in ecosystems that make sense for us. Recently, I’ve been to Finland and the Nordic countries. There’s a dynamic mix there of ambitious, technical founders with the social safety net to take risks. That kind of environment excites me. We stay as flexible as possible and just focus on finding the best opportunities.

Even though you’re making investments globally, BoxOne has deep roots in Montreal. How important is that local connection?

It is something that we all feel pretty strongly about. I would say our hub is in the heart of Montreal. Arvind and Josh built their first success story in Montreal and wanted BoxOne to stay here. Our families are here and we want to support the ecosystem here. Montreal has affordable lab space, strong universities and diverse talent. It’s a great place to build from a financial perspective. But founders also need to think beyond Canada. I always advise that by your seed raise — and certainly by Series A — you should have U.S. investors on your cap table. Founders feel that they need to leave to go be hugely successful. You don’t have to move but you can’t only think about scaling in Canada. You need to think beyond the borders while the headquarters can be here. So, be proudly Canadian but think globally.

Are you a climate tech investor interested in learning more about Canadian solutions? Explore more cleantech ventures on MaRS Connect. And reach out to Niyat Gebreab, senior associate in cleantech at MaRS, to learn more.

Photo courtesy of BoxOne Ventures