FirePower aims at Canadian lower mid-market

The Toronto-based investment bank has launched a new financing arm to address a perceived debt funding gap for growing companies.

FirePower Capital Corporation, the Canadian investment bank headquartered in Toronto, has set up an asset management arm to provide debt financing to lower mid-market Canadian businesses.

The FirePower Private Capital Division, billed as a “gap debt” lender, will aim to provide lower mid-market Canadian businesses with the capital they need to grow.

This kind of offering is seen as lacking in Canada compared with the US. “Quite simply, businesses here do not have access to what their US counterparts do in terms of next-stage growth financing, which is stifling innovation and giving Canadian entrepreneurs a bad rap,” said Ilan Jacobson, FirePower’s founder and chief executive.

The new division has around $100 million of capital committed by its principals, outside investors and a strategic partnership with a US-based private investment firm. It will offer loan sizes of between $500,000 and $5 million.

FirePower Capital Corporation was founded in 2009 as a family office and added an investment banking division in 2012. It has completed nearly 50 deals since 2012 and said it has current mandates worth more than $300 million.

The firm advises owners of lower mid-market private businesses on so-called “mission critical” transactions such as securing debt financing, acquiring a competitor or selling to a strategic buyer.