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The $600-million fund the federal Liberals created to invest in startups that use technology to fight climate change is losing money, and having difficulty finding companies in which to invest.

The fund, administered by the Business Development Bank of Canada (BDC), has invested in some firms that are failing to meet performance targets and that are at risk of defaulting, according to a year and a half of BDC’s financial documents and letters sent to cabinet ministers obtained by The Logic.

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In January 2018, Innovation Minister Navdeep Bains announced $600 million in funding for BDC to create a cleantech portfolio that invests in startups so they can “hire new staff, develop products, support sales, and scale up and compete globally.”

The internal documents show those goals are not being met.

“[Cleantech] portfolio firms are falling short of their own forecasts and, in many cases, BDC’s base case forecasts,” reads a July report BDC sent to Small Business Minister Mary Ng. The report also suggests BDC push for “more realistic” sales models from startups in which it’s investing, and flags investment activity as a risk measure “near or outside operating plan thresholds.”