GRIT - Ed.05 - Magazine - Page 23
ur tech scene is vibrant,
growing and brimming
with opportunity. When I
think about Canada and
our place in the global tech ecosystem, we are still very young. In fact,
I would suggest that we are roughly
in the third inning of the ballgame.
We’ve been at this game for roughly 10 years, and our ecosystem has
been developing since that time.
Next 36 went from an idealistic vision in the heads of the founders—
Ajay Agrawal, Reza Satchu, Claudia
Hepburn, and Tim Hodgson—to becoming one of Canada's first accelerators. The mission was to build a
founder development institute that
would address the gap in productivity and prosperity between Canada and the United States. Around
the same time, Georgian Partners
launched their first fund, and both
the DMZ and OMERS Ventures
launched a year later. Communitech, an accelerator/incubator in
Waterloo, launched a few years earlier. This was the infancy of the tech
ecosystem in Canada.
many metrics and proof points, but
really there are a couple of forces
Firstly, as Canadians, we are more
cautious investors and we are newer to the tech space. As we mature
and have more exits, that capital
will be invested back in our ecosystem and more sophisticated founders/angels will arise. This cycle will
continue and we’ll be able to fund
more and better startups.
Secondly, when you’re investing
in a company, you’re investing in
a founder and their team; whether it takes three days, three weeks
or even three months to get to the
right decision. A few weeks is insignificant if it's a phenomenal idea,
product and/or service that's going
to change the way we live our lives.
a critical long-term decision and relationship. it is important to choose
investors who have experience, maturity, and wisdom, and who will
stick with you when you’re inevitably faced with challenges.
You may go through hell and
back together. The challenges that
a startup faces are complex and
you’re in it together for the next
5–15 years. Character, confidence
and trust are important and best
understood at the outset, not in the
middle of a crisis.
EACH EXIT OPENS NEW DOORS
A startup will have a lifecycle of
5–15 years followed by some form
of exit. Generally, successful founders, who are now flush with cash,
begin investing in new startups,
mentoring and advising, but this takes time.
Let me give you some
This is not a decision or a
relationship to take lightly.
A founder has a brilliant inspiration, goes to market to verify that
the idea holds together and will
potentially be a gamechanger. The
founder goes out and raises money
from friends and family, and builds
the foundation of the company that
proves that their product and/or
service is really worthy of an investment. They then go forth and raise
an angel and/or seed round of investment from investors.
When investing in a founder, you
need to understand who they are as
a human being. You're judging their
character, integrity and courage.
You want to understand their vision and commitment to achieving
that vision. You want to assess their
co-founder and/or look at the team
they surrounded themselves with,
what they have accomplished as individuals and what skills they bring
to the table. If there is an advisor,
advisory board or mentor, it may
require some reference checking,
which may take a few calls.
Some argue that angel investors
in Canada are too difficult to work
with; short-sighted, demand too
It's also equally important for
founders to do reference checking
on the angel investor or VC — this is
HOW IT WORKS
Joe Canavan; Principal, Canavan
Capital; Board Member & Outgoing
CEO, NEXT Canada
BufferBox was a Waterloo-based startup built
by Mike McCauley and Jay Shah. It
became a success and was acquired
by Google in 2012. Mike and Jay
worked at Google, but their inspiration for the ecosystem remains and
their desire for building a better future for Canadians continued. Mike
went on to launch Garage Capital,
a venture fund that has invested in
Waterloo based startups like Clearpath Robotics, Bonfire, Clearco and
Ritual. Jay became the CEO of Velocity, a phenomenal accelerator
out of the University of Waterloo,
which helped launch ApplyBoard,
Nicoya and Bridgit (N36 ‘13).
Skip the Dishes was launched
in Saskatoon and built by Andrew