Partners in prime: Making Eastern Ontario a hotbed of investor-ready tech companies
- Ottawa, Ontario
After building 15 companies that have earned hundreds of millions in sales and employed many Canadians, Ottawa-based entrepreneur Steve Cody knows what it takes for start-up companies to succeed.
His current venture, the Better Software Company, quickly raised $2 million in investment financing in 2015 and another $1.6 million in 2016. Meanwhile, headcount has swelled from 4 to more than 40 employees.
But Cody does not soar solo. Partners in Eastern Ontario, supported by the Canadian Accelerator and Incubator Program (CAIP), contributed to the Better Software Company’s upward trajectory.
How did their collective support prepare Cody? Invest Ottawa conducted competitive analysis and generated targeted lists of potential partners. L-SPARK Corporation accepted him into its accelerator program, which he graduated from in 2015. Queen’s University and PARTEQ Innovations offered to pair him with business students and experts to verify marketing strategies. Meanwhile, the National Research Council of Canada’s Industrial Research Assistance Program (NRC’s IRAP) identified potential national and international relationships to advance Cody’s business.
“We’re encouraged to see government investing in innovation. And NRC’s IRAP goes to extra effort for clients and partners.”
Going the distance
From Kingston to Ottawa, those partners are pooling their talents to build an inclusive, productive innovation ecosystem for Eastern Ontario — one that meets the needs of start-ups like Cody’s, and encourages them to grow and stay in the region. "Together, the partners increase the odds that clients will succeed, and broader audiences hear of those successes," said Daniel Saikaley, NRC’s IRAP advisor who helps shepherd this regional project.
Upon securing CAIP funding for this growth, the partners began expanding their regional reach, expertise, core resources and existing support infrastructure like incubators and accelerators. To enable entrepreneurs to take advantage of ecosystem-wide capabilities, partners share best practices, programs, researchers and labs (at either Queen’s or Innovation Park), mentors, and even clients.
How is NRC’s IRAP involved? It oversees the delivery of CAIP and has advisors co-located with Queen’s and Invest Ottawa. The partnership’s clients are often IRAP clients, too. "We firmly believe IRAP is the best program in Canada to assist innovation companies," said Patrick White, L-SPARK’s managing director.
Applicants with potential for high growth compete for spaces in both the incubator and accelerator programs. Both provide access to the partners and services, just with deeper focus. Services range from market insights and business development to sales coaching and hands-on clinics that prepare entrepreneurs for delivering clear, compelling pitches to qualified investors at partner events.
Once accepted into one of the programs, clients receive dedicated days of attention, over many months, from an entrepreneur-in-residence or a mentor—all former executives or serial entrepreneurs who have built and fruitfully exited from companies. When NRC’s IRAP started working with Invest Ottawa in 2008, a single entrepreneur-in-residence existed; now, Invest Ottawa has nine, plus Queen’s and L-SPARK have them as well.
"We turn to IRAP colleagues for their deep, technical expertise and national perspective for our clients," said Janice Mady, director, Queen’s Industry Partnerships and Innovation Park. Often companies are not ready for full-time hires for operational activities. Instead, CAIP funding lets partners provide companies with access to professionals offering temporary, hands-on help: finance executives, patent agents, export advisors, turnaround specialists, lawyers and marketing experts. PARTEQ Innovations calls these "embedded management services," because virtual patent agents or chief financial officers roll up their sleeves to help manage a particular area.
Money to earn
Within two years, the partnership’s clients and graduates have secured an impressive $80.8 million in investments.
CAIP funding runs until 2019. "We’re encouraged to see government investing in innovation," said Jon Milne, Innovation Director, Invest Ottawa. "And NRC’s IRAP goes to extra effort for clients and partners."
Those partners want to deliver more than just programs that prime companies for investments. They are creating a foundation for lasting outcomes: a unified Eastern Ontario ecosystem for creating jobs and earning global revenues. Call it a hotbed for regional, tech resurgence, welcoming more companies like The Better Software Company.
A not-for-profit agency responsible for economic development and entrepreneurship initiatives across the greater Ottawa area. Invest Ottawa leads its GrindSpaceXL accelerator, and houses a team capable of delivering services ranging from entrepreneurial mentorship and business incubation to talent growth and international trade, and nearly everything in between.
Wesley Clover, an investment firm chaired by Sir Terry Matthews, established L-SPARK Corporation as a private-sector partner for the CAIP partnership. L-SPARK is the only Canadian accelerator that focuses exclusively on Enterprise SaaS and cloud start-ups. With established relationships with key venture capital firms, angel investors, and the investment community at large, the goal is to support a deal flow of fundable Enterprise SaaS startup companies in Canada.
Queen’s Industry Partnerships and Innovation Park lead the collaborations between the university, industry and not-for-profit partners. Queen’s offers: physical incubation space; GrindSpaceXL accelerator programs; matchmaking services that connect industry, researchers, technical resources, students and funding programs; and legal support. Launch Lab, a key delivery partner, provides coaching and advisory services to entrepreneurs.
PARTEQ leads technology transfer at Queen’s University. Responsible for commercializing Queen’s innovations, it has assumed a broader mandate under CAIP and provides embedded management services to entrepreneurs in need of expertise and support on intellectual property, patenting, licensing, and financing.