As we stand on the brink of the fourth industrial revolution, one fuelled by technological breakthroughs in artificial intelligence, machine learning, the Internet of things, robotics, nanotechnology and biotechnology, it has become increasingly clear to leaders around the world that innovation will be central to fostering future economic growth and prosperity. In his speech at the World Economic Forum in Davos, Prime Minister Trudeau noted the importance of this insight stating, “Canadians know that what it takes to grow and prosper isn’t just what’s under our feet, it’s what’s between our ears.”
In an attempt to further foster an innovative ecosystem, over the past couple of years the Canadian Government has developed a series of new investments and programs to support its innovation agenda. These include: C$4.5 billion to support research, training, and infrastructure at universities and colleges; a Strategic Innovation Fund that will provide C$1.26 billion for business innovation in the aerospace and automotive sector; a Connect to Innovate Program that will invest C$500 million to bring high-speed Internet to remote and rural communities by 2021; and, C$70 million over six years to support agriculture innovation with a focus on climate change, and soil and water conservation. By 2025, the government has declared that “it will double the number of high-growth companies in Canada, particularly in the digital, clean technology and health technology sectors from 14,000 to 28,000.”
These investments and more are urgently needed given Canada’s fall from being 12th most innovative economy in 2015 to the 20th most innovative economy in 2017, according to the Bloomberg Innovation Index. They will land on fertile ground, as there is no shortage of innovative ideas across the country that with the right support can be developed and successfully commercialized.
This is particularly true in Metro Vancouver, an area that has seen a blossoming of new and exciting startups in high-tech, health, information technology, clean-tech, digital media, and e-commerce.
But government programs are not enough. If they are to grow and thrive, startups require investment income, material and human inputs, and of course markets. While the United States and Europe have been at the forefront of providing investment and markets, this trend may be changing as economic dynamism shifts to Asia.
The data speaks for itself: by 2020 Asia will be home to 54% of the world’s middle class, representing 42% of the world’s total consumption. With income to spend, Asian’s middle classes constitute a huge market for Canadian innovators. In addition, in the last two years there has been a steep rise in investment from Asia into North American high-tech companies – led by China. While most of the investment has flowed into U.S. companies, there is no reason why Canadian companies couldn’t start to see some of this funding coming their way. In fact, there is evidence that this is already happening. According to the Investment Monitor operated by the Asia Pacific Foundation of Canada, Asia Pacific investment in Canada between 2003-2016 saw 96 deals with a total value of over C$2.8 billion in the technology services and equipment sector. Close to one third of this investment was made between 2014-2016.
The purpose of Tech Corner, a new series by APF Canada, is to showcase Canada’s innovative capacity by placing a spotlight on local companies that are pushing the boundaries of our technological capacity. While there are many firms to choose from, we are focusing on companies that have global potential and that are engaging with Asia or have a strong interest in exploring Asian opportunities. In a series of interviews with company leaders, we will highlight the opportunities and challenges that the companies have faced when marketing and operating internationally. We hope to capture lessons learned from the firms that have expanded into Asia and provide them to other companies that might be interested in similar ventures. Most importantly, we want to share with you the AMAZING work that is underway in our country.
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