Venture capital funding in Canada dropped seven per cent year over year in the first quarter of 2020, with $834 million raised—but that likely reflects only part of the COVID-19 pandemic’s impact on Canadian venture deals.

“We expect to see a significant drop in the second quarter and potentially the third as members have increased their reserve funding for existing portfolio companies,” said Kim Furlong, CEO of the Canadian Venture Capital and Private Equity Association, which compiled the data. “We expect time to close to increase given the additional caution in the market and the difficulties of conducting due diligence with social distancing.”