Ottawa-based defence VC fund ONE9 acquired by Kensington Capital Partners

April 2, 2025

Kensington has purchased ONE9’s investment team led by founder and managing partner Glenn Cowan, the companies announced Wednesday.

Already an Insider? Log in

Get Instant Access to This Article

Become an Ottawa Business Journal Insider and get immediate access to all of our Insider-only content and much more.

Learn More and Become an Insider

An Ottawa organization that specializes in funding defence and security startups hopes to ramp up its investments after its venture capital arm was acquired by Toronto-based VC giant Kensington Capital Partners. Kensington has purchased ONE9’s investment team led by founder and managing partner Glenn Cowan, the companies announced Wednesday. As part of the deal, all of ONE9’s future investment activities will take place under the Kensington umbrella. Financial terms of the deal were not disclosed. The transaction cements a relationship between the two organizations that began five years ago when Kensington, a private equity and VC firm that manages more than $2.6 billion in assets, and ONE9 partnered to create special purpose vehicles to fund up-and-coming defence-tech ventures. In short order, Kensington became the lead investor in ONE9’s inaugural $10-million fund. With Kensington’s backing, ONE9 has since invested a total of about $23 million in six startups. Cowan, a former Canadian special forces commander, founded ONE9 after being discharged from the military following a training accident. He says there was a “logical synergy” between his group and Kensington, which has been boosting its investments in the defence sector over the past few years. “Kensington was really the first institutional investor in Canada that really said, ‘Hey, you know what? Investing in this sector is not scary,’” Cowan said in an interview on Wednesday. Kensington senior managing director Rick Nathan, who was introduced to Cowan in 2019, credits the ex-military officer for helping open his eyes to the industry’s true potential. “Glenn was awesome at identifying and getting access to really strong investment opportunities in this sector – and not just the access, but then working with the companies to help build them and grow them for success,” Nathan said. The veteran venture capitalist says the defence and security sector is suddenly in the spotlight as governments across the globe try to navigate a rapidly evolving geopolitical landscape. “When you have both major parties in Canada talking about how much they’re going to be increasing defence spending, you know something has changed,” Nathan said. “Looking around the world, we see all major countries increasing their spending on this sector. We also see growing threats in cybersecurity. No companies are decreasing their budgets for cyber. You kind of put that all together, and you say, ‘This is a really interesting growth idea.’ So we decided to combine forces.” While the defence-tech sector has traditionally been dominated by huge multinationals, Cowan said that’s changing. “We’re seeing a seismic shift away from (major defence contractors) and (original equipment manufacturers) owning the market to emerging, disruptive venture-backed startup companies carving out a really competitive piece of the wider national security-defence ecosystem,” he explained. ONE9’s portfolio includes a company that has already made a successful exit, Florida-based Tomahawk Robotics. Founded by a former U.S. Navy SEAL, Tomahawk makes hardware and software that controls drones, robots and other unmanned vehicles. Less than two years after ONE9 invested in the fledgling firm, it was sold in 2023 for US$120 million. “It represented a great return for us,” Cowan said. “That was a hugely validating deal.” The organization’s lone Canadian investment so far is Ottawa-based Ventus Respiratory Technologies. The startup has developed a respirator that Cowan describes as “body armour for the lungs” designed to protect military personnel, police officers and first responders from breathing in carcinogens and heavy metals. He says the system is now evolving into a piece of wearable equipment that allows users to communicate with radios, drones, virtual reality systems and other technology. Cowan says that while many Canadian venture capital firms have traditionally been “skittish” about putting money into defence startups, he believes the national investment community’s perception of the industry is changing. “I say it’s so much more than guns, bombs and bullets,” he explained. “Canada is waking up now to the (realization) of how important this sector is going to play in our economic security, our national security, our climate security, our energy security, our sovereignty, our Arctic security.” Nathan agrees, saying the Canadian tech ecosystem has “all the building blocks” to build a vibrant defence-tech sector. “We have the AI talent, we have the robotics and autonomous vehicles, we have space-tech, cybersecurity,” he said. “These are huge categories where Canada does have the talent. There is a very significant overlap between what we’re focusing on together in this national security thesis and what are already the leading subsectors of tech.” Kensington is also acquiring a minority stake in ONE9 Capability Labs. Based in a 7,000-square-foot facility near Hintonburg, the ONE9-owned entity is an “innovation hub” that provides support services to the Ottawa firm’s portfolio companies and other private defence organizations. Cowan says the lab is a place where tech founders, members of the Canadian Armed Forces, academics and others with a stake in the defence sector can gather under one roof to brainstorm ideas and help incubate world-leading technologies. “We want to be that one-stop shop for all national security end users,” he said. Still, while the country appears to have all the ingredients for a successful homegrown defence technology sector, Cowan noted that securing Canadian military contracts is a “painfully slow” process for small domestic firms. The former soldier worries that Canada is “going to lose an incredible amount of Canadian companies to the Americans that can just move that much faster” if federal procurement policies aren’t streamlined. “For Canada to be successful in this sector, we need Canadian customers,” he said. “We need the Canadian Armed Forces to buy Canadian.”