The Canada Pension Plan Investment Board, Canada’s largest pension fund, will seed more startup hedge funds this year as part of a plan to diversify its investments, according to a report by the Financial Post.

The CPPIB, which manages $570 billion in assets, will spread funding among more firms as part of its emerging manager programme by reducing the starting amount they invest with each fund. Each will receive amounts starting from US$50 million, down from US$100 million, a person familiar with the matter said.

The move comes as startup hedge funds face an increasingly launch environment, with larger multi-strategy players squeezing out emerging managers in the battle for investor allocations. More than 2,500 hedge funds have shuttered over the last five years, exceeding launches during the period, according to HFR data.

A spokesperson for the Canadian pension fund declined to comment.