BDC\u2019s CEO talks AI, direct investing, and staff turnover after her mandate was renewed until 2030. <\/p>\n
<\/p>\n
The Business Development Bank of Canada (BDC), through its VC arm BDC Capital, has the capital and the leverage to set the tone for Canada\u2019s business and tech sector\u2014whether that\u2019s through a newfound focus on defence or heavy promotion of AI adoption.\u00a0<\/p>\n
Isabelle Hudon was appointed president and CEO of BDC in August 2021. Five years later, she has been renewed for a second term<\/a>, until at least 2030. BetaKit sat down with Hudon in Montr\u00e9al this month to discuss the Crown corporation\u2019s approach to AI, indirect versus direct investing, and why it\u2019s time to put the \u2018C\u2019 in BDC.\u00a0<\/p>\n The following interview has been edited for clarity and length.<\/p>\n What is your priority for the next four or five years at BDC?<\/p>\n First, to stay on the growth path that we have been on for the last five years.\u00a0<\/p>\n \u201cI feel that the influence we have with our direct investment is quite powerful.\u201d<\/p>\n Isabelle Hudon, I\u2019m quite proud of how the team embarked on this vision five years ago: not only to keep on doing our work very well, but doing more for a greater number of entrepreneurs.\u00a0 We have a dual mandate: a commercial mandate and a development mandate. At the time, my colleagues felt that we were massively delivering on the commercial mandate and probably not enough on the development. That\u2019s what we have done over the last five years. We gave a capital D to BDC, and we will keep that capital D.<\/p>\n With what\u2019s going on in the economy, it\u2019s now time to honour the C in BDC and contribute to the economic sovereignty of our country. That\u2019s why I feel that I\u2019m in the same organization for a second mandate, but with a different twist.\u00a0<\/p>\n Can you tell me more about what honouring the capital C will look like?<\/p>\n Contributing to the reshaping of our economy and making sure that we\u2019re increasing our economic sovereignty. We cannot do it all at BDC, but certainly we can contribute to this goal.<\/p>\n It means also having high ambitions for the defence and security sector. We had almost no exposure a year ago; on a portfolio of $55 billion, we had no more than $400 million of exposure.\u00a0<\/p>\n Is there a specific level of exposure you want to reach with defence?\u00a0<\/p>\n Going from $400 million to $6 billion<\/a>. After less than one year with this platform, we\u2019ve almost doubled the exposure.\u00a0<\/p>\n Speaking of defence, Canada\u2019s been selected to host the new international defence bank<\/a>. You don\u2019t know which city it will end up in, right?\u00a0<\/p>\n *laughs*\u00a0<\/p>\n I\u2019m impressed by the level of awareness of this new bank. It says a lot about where we\u2019ve moved along in Canada in the interest of defence and security.\u00a0<\/p>\n When the announcement became public that I was renewed here, there were a lot of questions because I was highly involved in the negotiation of the charter of that new bank. But it will be a standalone; BDC won\u2019t have anything to do with it.<\/p>\n Let\u2019s talk about BDC Capital. We\u2019ve reported on the tension<\/a> between investing directly in startups, versus investing indirectly via funds. Now that BDC has a new direct life sciences fund, do you have plans to change the weighting of how much money is allocated directly versus indirectly?<\/p>\n It\u2019s a healthy debate. The short answer is yes.\u00a0<\/p>\n Having been overly invested directly allowed us to have great influence on crowding in money from the private sector. We\u2019re often one of the first investors to join, and often one of the last, if not the last, to leave the table. So it\u2019s a vote of confidence.<\/p>\n When we deploy capital through the indirect channel, we don\u2019t have that level of direct influence. That being said, the influence we have through the indirect channel is that we\u2019re getting the ecosystem bigger and richer, not with dollars but with expertise.\u00a0<\/p>\n
BDC<\/p>\n