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Labour Sponsored Investment Funds (LSIFs) are corporations sponsored by labour organizations designed to invest in small and mid-size Canadian businesses subject to the following criterion:
- Less than 500 employees
- Less than $50 million in assets at the time of investment
- Maximum $15 million investment
LSIFs now account for approximately 40% of all venture capital raised in Canada. LSIFs are a way to try to reduce risk and enhance potential returns. A typical LSIF investor reduces the risk exposure of investing in venture capital by holding a diversified portfolio of small- to mid-size companies. LSIFs may specialize in certain sectors of activity, such as biotechnology or information technology. They also differ in the investment stage of companies.
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