Investment Opportunity Grows With The Venture Exchange
Merger And Market Developments Beyond Toronto
Investors Look Far Beyond The Canadian Shield
Investors financed many Canadian Shield ventures that substantially contributed to the growth of Toronto. However, Canadian resource opportunities reached far beyond that one vast geological treasure trove.
Mineral and other natural resource bounty extends across the entire Canadian landmass and well into the seas of three very long coasts. Canada is a huge, opportunity filled, country, with relatively few people and vast amounts of natural resources.
This post is Part 6 of the White Top View Series, Stock Markets, basic discussions of the American and Canadian stock markets. Links to all parts of the series are at the end of this post.
Investment Opportunity Grows With The Venture Exchange Merger
Investment opportunities extended far beyond Toronto as explorers sought to exploit new resource opportunities. The opportunities to exploit natural wealth beyond the Canadian Shield, were seemingly beyond the capacity, or at least the interest of Bay Street financiers in Toronto.
The rich prospects in the Canadian Shield, the geological backyard of Toronto, remained the focus of Bay Street. Compared to such great opportunity right in Ontario, prospects farther away, seemed much less attractive. That created a need and opportunity. Following is a brief overview of how that investment opportunity grows with Venture Exchange Merger.
Montreal Played An Historic Financing Role
Historically, financing resource developments, contributed to business growth in Montreal. Times change, people change and politics intervened. The combination changed the course of history. Suffice it to say, a series of political decisions made in more recent Quebec history, changed things. That included business focus and conduct.
As a result, the new business environment changed both opportunities and outlooks. Quebec immediately gave, or more correctly, surrendered, any national equity financing role to Toronto, Vancouver and Calgary.
Toronto then decisively took the lead as the national financing center. Montreal rendered itself an irrelevant player for public equity financings.
Today Montreal remains a very important city and business center. It continues to house the Canadian Derivatives Market. But has no role in national public equity financing. The derivatives market will be part of future discussions when we cover a range of investment alternatives.
Western Financing Emerges
Being mindful that there was a time when crossing the country could take more than a week; perceptions then were very different from our one screen connected world! Technology and communication were different. Messages could take weeks or months to arrive, not the nanoseconds we now expect. Regions far from Toronto, remained very far from the minds of Bay Street players.
Toronto ignored or dismissed prospects west of Ontario. In part, the lack of regard, attention and financing were seeds for growing regional tensions. That atmosphere created opportunities for alternative trading centers to emerge.
Western ventures unable to get eastern attention or capital were ripe for exploitation. Left to their own devices, western players got together and produced their own solutions. The first to emerge, was on the Pacific coast.
The Vancouver Stock Exchange
The magnificent, massive and multiple mountain ranges of British Columbia impress all who see them. So anyone seeing that magnificent geology can understand why geologists and prospectors look at them and fall in love with this place. They wanted to explore and prospect; they needed funding.
With Bay Street and Toronto financiers focused elsewhere, quick footed Vancouver promoters seized opportunity. The Vancouver Stock Exchange created the first equity financing west of Toronto.
Since 1906 when the Vancouver Stock Exchange began public financing, many mining plays and startups received vital funding from Howe Street. That continued the established and long history of prospectors turning to Vancouver financiers for a grubstake.
Vancouver promoters rolled the dice on many prospects. As usual, in mining exploration ventures, many, in fact most, failed. The misses and losses broke hearts and wallets; many deals found dirt, but no gold. But not all deals went bad; there were spectacular successes!
These occasional significant discoveries, and enough smaller winners, kept the game alive and investors coming back for more. I guess it always was and remains true; one more of us is born every minute! Sucker, have I got a deal for you!
Investors Recognize A World Class Expert Community
There was another extremely important side effect! The professional community grew to support the investment activity. That created a professional, business and financing center on the Canadian west coast in the urban jewel, Vancouver.
Over the past century, generations of accounting and legal professionals developed mining and deal making knowledge and experience. Those professionals and a core of promoting, investing and operating people, developed and collaborated. That made Vancouver the center of a complex resource based business network. These people know mining.
That collective mining knowledge and deep understanding of how to find, build and work a mine grew over multiple generations. That community now enjoys a worldwide recognition and activity. That is why Canadian experts and accents are so common at mine sites around the world.
The Vancouver Stock Exchange financings drove that professional community development. From then until now, business continued in both fat and lean times.
The next post in this series discusses the other half of the merger that created the TSX Venture Exchange, the Alberta Stock Exchange.
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Links to the White Top View Series, Stock Markets