Malcolm Fraser, the last CEO of Innovacorp, has taken a new position as Managing Director of NPC Ventures, the new venture capital arm of Charlottetown-based Natural Products Canada.

NPC Ventures aims to be a $50 million fund that invests in companies making products out of natural materials, with a special emphasis on nutrition, human and animal health and agtech. The fund now has $20 million in commitments from multiple limited partners, and Fraser is working on raising the remaining $30 million. He hopes the fund will be operational early in 2023.

“Here is an opportunity to make an impact in a fast-growing market that is being driven by consumer demand,” said Fraser in an interview from his home in Chester, NS. “The opportunity to make an impact on the food we eat and the products we buy is tremendous.”

He admitted raising $30 million in the current environment will be "challenging for sure". But he added there is greater investor interest in natural products than other sectors of the innovation economy because of the economic opportunity and the socio-environmental impact of these companies. 

Fraser and Innovacorp parted ways this summer when the government of Tim Houston announced that the government-owned venture capital agency would be merged with the economic development group Nova Scotia Business Inc., or NSBI. The legislation to create Invest Nova Scotia – as the merged group will be known – is expected to be introduced this month.

After a career as an entrepreneur, Fraser joined Innovacorp in 2017 and under his stewardship the Crown corporation focused more on backing companies with the potential for billion-dollar valuations. The highlight of his tenure was Innovacorp’s $104 million exit from Dartmouth-based Meta Material, which produced 34-times return on investment and earned a Canadian Venture Capital and Private Equity Association Deal of the Year Award.

Both Fraser and his NSBI counterpart Laurel Broten departed when the government announced the creation of Invest NS. Broten has since been named the CEO of Invest in Canada, an arms-length Government of Canada organization that promotes foreign direct investment into Canada.

During his time at Innovacorp, Fraser developed an affinity for VC and had been working to establish an oceantech fund based in Atlantic Canada but with a broad geographical mandate.

NPC Ventures will target companies based anywhere in Canada that develop naturally derived, biologically based solutions that benefit people, animals and the planet.

“This was one of the growing market sectors that I was seeing at Innovacorp and NPC Ventures is an incredible opportunity to support Canadian founders who are commercializing natural product innovations for this trillion dollar market opportunity,” said Fraser in a LinkedIn post. “NPC Ventures will have a close working relationship with Natural Products Canada, a national commercialization platform that is working with leaders in this sector.”

A brainchild of the PEI BioAlliance, Natural Products Canada launched in 2016 to support the growing industry. Under the leadership of CEO Shelley King, the organization has already made equity investments in several companies. Fraser described the existing investments as an “incredible” portfolio, but will not oversee these relationships unless the new fund chooses to do follow-on investments in them.

The Atlantic Canadian companies backed so far by NPC include: Charlottetown-based Island Water Technologies, a multi-faceted water technology company; Fredericton-based Chinova Bioworks, which is making preservatives from fibre extracted from mushrooms; Halifax-based PhotoDynamic, Inc., whose technology provides dental hygiene for people wearing braces;  Halifax-based DeNova, which has developed a process to use methane to produce protein for fish and animals; and Saint John-based Millennia Tea, whose tea has five times as many antioxidants as normal green tea.