John Stackhouse, Senior Vice President, Office of the CEO at RBC, recently hosted Go North, a brainstorming conference for entrepreneurs put on by Google and Royal Bank of Canada at Toronto’s Evergreen Brickworks. He has provided a summary of the event and his thoughts, below.
Canada is suddenly the world’s poster child for progress. Even the Economist — official voice of the former empire — has us (Canada) on the cover as the saviour of liberty. Not so fast. When it comes to economic liberty, Canada's not quite true north, strong and free. A good place to start a business, sure. Not a great place to grow one. At least not yet.
Digital technology now accounts for 4.4% of economic activity, 600,000 jobs and $172 billion in economic output. Canada's in the game, for sure, just not on the podium. Canada’s prospects and pitfalls were on stage last Friday at Go North, a brainstorming conference for entrepreneurs put on by Google and Royal Bank of Canada at Toronto’s Evergreen Brickworks.
Here are 10 big insights that emerged — and some ideas to help get us there:
1. Pick a lane, and stick to it
Canada moved up the Olympics standings by focusing more money on fewer sports. Same approach is needed for technology. Mike Lazaridis, co-founder of Research in Motion and Quantum Valley Investments, stressed it’s hard for 35 million people to be great at everything. He said Canada should double down on clusters of excellence. His point: If you’re not in the top 5, you won’t be in the game when it comes to attracting investment and talent.
Idea: Declare artificial intelligence and quantum computing as national priorities, and measure Canada’s success at them globally.
2. Attract. Retain. Rinse. Repeat.
№1 issue was talent. In digital, it’s not a game-changer; it is the game. Why? The biggest expense for any tech company is people. The top question for any investor is people. Trouble is, while Canada has a lot of engineering and start-up people, we’re way behind on “senior talent” — people who have taken a $10-million company and 10x’d it. Michael Litt from Vidyard, a video intelligence business, said he has three executives who commute from the United States, because he can’t find the senior talent in Canada.
Retaining such talent matters hugely, too. Ted Livingston, founder of the social messaging company Kik, said he recently asked a University of Waterloo audience, how many graduates planned to stay in the area. Of 500 present, 3 raised their hands. How many planned to go to Silicon Valley? Roughly half.
Once Canada can retain our top engineers and attract some exceptional, influential senior leaders, the domino effect will be huge. Tax rates have an impact. House prices and creative environments often matter more. Most of all, global talent wants to be around global talent, and often those are the people working for world-class firms and world-class universities. Getting those firms needs to be a priority.
Idea: Mandate a pan-Canadian agency to source, recruit and retain global talent.
3. Create Canadian headquarters
Small fish need big fish to survive, and Canada’s lost a lot of big fish. Toronto just got back Thomson Reuters, which is moving its executive team from New York to here. That’s huge, as it will lead to all sorts of decisions that benefit Toronto-area firms and talent. British Columbia is driving the same agenda, persuading Chinese firms to use Vancouver as a North American base. Bottom line: global HQs are the big fish. Canada needs to restock the pond.
Idea: Charge a single public-private, federal-provincial agency with the challenge of winning global mandates.
4. Buy Canadian
Strong HQs lead to more local procurement and talent sourcing. Canada's banks and insurance companies already do a lot — and can do more. So can Canada's big auto parts firms, food producers and retailers. The biggest fish may be government, which can do much better supporting digital entrepreneurs through procurement and partnerships. Several entrepreneurs said they need government to be an early customer, to give them cred when they go abroad. Today, Ottawa spends $9 billion on outside goods and services. A lot more coordination is needed, as too many firms get snagged in a complex procurement process when they should be building products.
Idea: Design a Canadian procurement pact that sets a standard for all large companies and governments.
5. Sell American
For any tech firm, the U.S. is not just 10 times bigger than Canada; it sets the global standard. If you’re not big there, good luck anywhere. Several panelists admitted their biggest mistake was not going to the U.S. sooner — whether it was to look for customers, attract investors or spend time working in the Valley.
Idea: Ensure any new public capital comes with U.S. growth targets.
6. Declare national problems
Governments can help shape the tech game by setting big horizon goals such as climate change, cybersecurity and immigration — and then incenting entrepreneurs with prizes and support to solve those problems. By acting as a broker between private and public sectors, government can also boost funding in key areas and kick-start research. One good sign: Ottawa has committed $1 billion to help develop clean technologies. Mike Lazaridis stressed the importance of strategic philanthropy — witness his support of Waterloo’s Perimeter Institute — as a further catalyst for government funds. Or consider Google.org: It just announced an Impact Challenge that will award $5 million across 10 Canadian organizations to bring world-changing ideas to life through technology.
Idea: Read 6.
7. Attract smart capital
The Go North entrepreneurs recognized there’s never been so much capital available to help companies grow. It’s just not always smart capital. Startups need capital that provides a 10-year window to carry great ideas forward, with intellectual support as well as money. Most of Canada’s smart capital now comes from the U.S., where venture firms have a lot more experience getting companies to the world stage. In response, Canadians need to look for investors outside the current ecosystem, and attract angel money from individuals who have street cred. Harley Finkelstein, the COO of Shopify, says the Canadian mindset needs to change, with more focus on secondary liquidity. That’s the pool of money that not only helps firms grow; it rewards founders without forcing them to sell.
Idea: Incent global VC players to expand to Canada.
8. Attract smart people
Innovation Minister Navdeep Bains reminded the crowd that importing top talent does not take jobs from Canadians. Rather, skilled immigrants — entrepreneurs especially — add jobs. Trouble is, Canada’s immigration system can take months, or years, to get skilled people across the border. Opportunities don’t wait for months, let alone years. To own the digital podium, Canada needs a fast-track program that gets the right people into the right opportunities at the right moment. Just-in-time immigration.
Idea: Create a new professional visa class that can be co-administered by sectoral groups.
9. Attract smart mentors
Canada’s got plenty of accelerators and start-up programs; most think they’re doing a pretty good job, too. One gap is mentorship networks. The Go North entrepreneurs said the best mentors are a year older than they are, and still in business. They can also come from established businesses, be they banks or manufacturers. Ugly truth is, the best mentors are people who don’t have time. Time to get ’em engaged.
Idea: Build a Canadian social media platform for entrepreneurs and mentors.
10. Diversity, digital-style
Canada continues to fall short on gender diversity in business. It’s the same across the tech world, which means there’s a chance for Canada to lead the world. Today, 13.1% of corporate board seats are held by women; 40% of companies don’t have any women on their boards. Start-ups aren’t much better. Despite colleges and universities graduating more and more women in STEM programs, they’re not sticking around the digital ecosystem. The start-up, scale-up and corporate communities can change that picture by attracting a range of students to tech programs, by changing the mindset of what a “typical” engineer looks like, and by embracing diversity of thought.
Idea: Launch a public database to monitor companies, VCs and the sector on gender balance.
As Senior Vice President, Office of the CEO at RBC, John Stackhouse is responsible for interpreting trends for the executive leadership team and Board of Directors with insights on how these are affecting RBC, its clients and society at large. Prior to this, John was editor-in-chief of The Globe and Mail (2009-14), editor of Report on Business, the newspaper’s national editor, foreign editor and its foreign correspondent based in New Delhi, India (1992-99).
This article was originally sourced from RBC Discover & Learn.