GRIT - Ed.04 - Flipbook - Page 9
A NEW
FRONTIER
HOW STARTUPS CAN LEAD THE CHARGE
IN THE DIGITAL REVOLUTION
the humanitarian health
B eyond
tragedy of the COVID-19 pan-
By John Kelleher,
Co-Chair, NEXT Canada
demic, we have witnessed the profound impact the crisis has had on
our local and global economies. It has
reshaped how we work, bank, learn,
shop and connect with one another.
Our day-to-day lives were changed
with immediate effect and—as one
does—we adapted.
Naturally, these micro behaviour
changes reverberated through to the
macro-level, and economists quickly
sought to gain insights into how consumer behaviour has changed. After
a ten-year period of almost perfect
linear increase in the percentage
of retail sales that were conducted
online relative to offline, we experienced a step function increase that
would represent a ten-year acceleration in a mere five months. This digiti-
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zation shock occurred across all other major domains including e-health,
e-learning and e-banking. In the process, businesses were quickly forced
into making significant changes, as
they scrambled to find new ways to
interact with customers in a contactless world.
All arrows point towards this being a seismic paradigm shift. Take the
ecommerce space, where consumers are reporting a long-term intent
to do the majority of their shopping online, with a growth of up to
35 percent. This insight reflects an
emerging trend across industries,
yet businesses must respond by
bridging awareness of the options
open for digital customers, invest
in relevant marketing strategies and
support vulnerable customers who
are less familiar with digital channels.
Brand loyalties are also facing a
reckoning, with consumers choosing
alternative purchasing behaviours
in response to new economic
challenges, store closings, and
changing priorities. In fact, more
than 75 percent of consumers are
trying new shopping methods,
with 73 percent expressing an intent in moving away from their
typical brand habits. Beneficiaries
of this change have been large,
trusted companies who are seeing 50 percent growth during the
crisis, and private labels, which
have outpaced the retail market.
With the increasing shift to
a digital-driven economy,
we must protect and stand
by our startup community
to help drive us forward.
These drastic consumer behaviour changes have
led companies to make significant changes to keep up
with the altered demands, including accelerating the
timeframes of their digital transformation strategies.
Prior to the pandemic, many executives listed cost savings as a #1 priority for their digital strategy. Now, only
10 percent are tightening their purse strings. In fact,
executives have begun to see technology as a competitive advantage, and many are actually recentering their entire businesses around new and improved
digital channels.
With the increased need for companies to be agile and more digitally connected, startups are perfectly
positioned to fill the gap. They help companies to do
things faster, smarter and cheaper. And with today’s
context in mind, the need for innovation, adaption and
scaling up solutions is all the more pressing.
Entrepreneurs must seize this opportunity while
they can. As a starting point, entrepreneurs—particularly those developing deep-tech solutions—should
challenge their perceived notions of which industries
they can operate in. Advanced industries, for instance,
are responsible for a large portion of the nation’s output, exports and R&D, yet they are often overlooked by
startups due to their typically slow pace of innovation.
In order to achieve success in this area, entrepreneurs must begin by asking themselves the right
strategic questions. Who are the main suppliers in your
industry that you can seek a partnership with? Who are
the major blue chip customers that you could solicit
for a strategic investment? Who are the directors of
large companies in your industry that would be a good
fit for your board? As you start
to put these puzzle pieces
together, you are more likely
to gain a critical seat at your
industry’s table and, in turn,
further growth opportunities
down the line.
Success stories are already
emerging. Startups like Tia
Health, a telemedicine startup
founded by Next 36 ‘14 alumni
David Del Balso and Matthew
Mazzuca, who have worked
in partnership with companies such as Rexall and Remedy’sRx to launch a virtual care
service for patients. Through this effort, Tia Health is
helping to reduce bottlenecks and relieve the current
burden on the acute healthcare system. Or Ada, an AI
customer experience company led by Mike Murchison
(Next 36 ‘12). At the beginning of the pandemic, the
Ada team was working hard to best support their enterprise clients during the fallout. After shifting their
focus and prioritizing clients in several growth sectors,
they secured a new contract with Zoom, and helped
them to scale from 10M daily active users to more than
300M active users. Other large companies followed, resulting in a record year of growth for the company.
As Co-Chair of NEXT Canada’s Board of Directors,
I have seen first-hand how Canada’s entrepreneurial
ecosystem has responded to the pandemic. From manufacturing PPE to using AI in the search for COVID-19
drug discovery—through their actions, entrepreneurs
have leveraged their unique skill sets and demonstrated the critical role they play in the road to recovery.
With the increasing shift to a digital-driven economy, we must protect and stand by our startup community to help drive us forward. The ideas are there. The
innovation is there. The willingness to succeed is there.
And, in Canada, the networks and institutions are there.
As we look towards a path to recovery, we see a
new world in front of us. A world that has been altered
not just by the health crisis, but by the new digital frontier. Let us leverage the power of our entrepreneurial
ecosystem, so that we can chart a stronger and more
sustainable future for Canada.
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