Rick Segal of JL Albright MC'd a special Toronto Venture Group breakfast yesterday. Two of the "Victor" Award winners from this year's Canadian Venture Forum were on hand to talk about their experiences raising venture capital.

It is easy to see why Rob Imrie, CEO of Demand Cast and Kevin Leflar, CEO of Official Community Corporation won their respective categories. Both were articulate, focused, and, of course, convinced that their companies are the next big thing. How big? Segal segued into the formal business presentations by offering a context for their businesses: The Intention Economy.

To Segal, the intention economy is the true driver of successful online advertising. Since ads are the holy grail of the Internet's ROI, any solution that more effectively connects ads with people who actually want the related service or product will be a hands-down success. Demand Cast and Official Community Corp. might just be ways to achieve that end.

But here is the problem. These two companies passed the selection committee at the Canadian Venture Forum. They then jumped through the presentation hoops there and were selected as the most worthy companies for venture investment by a community of financial specialists. They have been vetted, turned inside out, inspected, and almost due-dilligenced to death. For what? They are looking for about a million dollars each. Neither has a term sheet yet.

Let's get this straight. Hundreds of companies apply. Some are weeded out. The rest go through an intense two day peer review. Check. Three are selected. RIght. What happens? Apparently, not much. That's not the fault of the CVF organizers who are doing what I think is a stellar job showcasing Canada's entrepreneurial community.

So, why do all this work and end up with a collective yawn from Canadian VCs? That is a hard question (...read more...)