If last month’s budget is any indication, the federal Liberals are prepared to do much more than just pay lip service to their “innovation agenda.”
The budget document mentioned the word “innovation” 311 times. The government is positioning it as a plan for Canada to become a leader in the digital economy.
Despite all the focus on that buzzword, the “innovation” budget’s impact on Ottawa technology firms over the next year will likely be minimal. However, there is one big-ticket item in the Liberal agenda that the local tech sector can’t afford to ignore.
The federal government has budgeted $950 million to develop a series of so-called “superclusters” over the next five years starting in 2017-18. Why is this important for Ottawa?
The government is planning on holding a competitive process to select the industries and who will lead these superclusters, under the theory they will become business hubs that attract investment and anchor companies from around the world. The Liberals have targeted six sectors: clean-tech, biosciences, agrifood, advanced manufacturing, clean resources and digital (which would include information technology and networking, for example).
Various geographic locations will be competing to be the centre of the so-called superclusters. Montreal for biosciences and Calgary for clean resources could be considered naturals. However, when it comes to digital, many cities will be vying for leadership, including Vancouver, Toronto, Waterloo and, of course, Ottawa.
The government probably will not award more than one supercluster per sector or more than one per city. Although the full details of the program are still being fleshed out, future federal funding for research, advanced skills development, export strategies and risk capital will very likely be focused on the winning centres.
Can Ottawa bid for a spot in this select group and have any chance of being successful?
In my experience, the federal government is reluctant to award funding to initiatives in its own backyard. Waterloo is currently viewed by many politicians as the tech capital of Canada, Vancouver is quickly emerging and Toronto has the most companies and people employed in tech by virtue of its huge population.
Working together, Ottawa, Toronto and Waterloo can be greater than the sum of their parts and position themselves as a strong competitor to Silicon Valley
Ottawa was recently named Canada’s top tech centre in a survey of eight Canadian cities by business services provider Expert Market. But as nice as it looks on the city’s résumé, such an accolade might not be enough to counter the combined force of the Toronto-Waterloo corridor, which has been actively marketing itself as Canada’s leading tech region for the past several years.
For Ottawa to have a chance, its business, academic and local government sectors will need to collaborate with the province’s other tech centres.
In my days at Invest Ottawa’s forerunner OCRI, we partnered successfully with Toronto’s MaRS Discovery District and Waterloo’s Communitech on programs to support local businesses. But those were mostly provincially funded, and it was a major challenge to get everyone on the same page with a sense of urgency. This is one of the reasons it took years for Ottawa to develop its own accelerator, which only recently opened in the Innovation Centre at Bayview Yards.
In the increasingly competitive global marketplace, it’s vital for Ontario’s tech hubs to work together to align our visions and position ourselves as a digital supercluster that can compete with the world’s best. There is no time to waste: The supercluster application process will begin in May or June of this year.
The federal government has mandated that superclusters must be led by business. Invest Ottawa is our business and academic leadership organization, and it makes sense for it to spearhead Ottawa’s efforts in the supercluster bid.
Its challenge will be getting Toronto and Waterloo to buy in. They believe they will be the winner in any competitive process with or without Ottawa, and they’re probably right. Ottawa needs to lean on its current and emerging strengths to convince tech leaders in those other cities that the nation’s capital is an indispensable part of any Ontario supercluster bid.
A supercluster must be able to articulate what its strengths are, and Toronto and Waterloo do not have the same strengths as Ottawa. Our challenge is that every individual business will want its specializations recognized as a strength. We need to focus on our clear strengths.
I believe Ottawa has a clear edge in three sectors: fifth-generation networking; enterprise-focused software as a service; and software for autonomous vehicles. Linking these strengths is the city’s growing base of artificial intelligence companies that will be integral to future networking, enterprise software and autonomous vehicle development.
Ottawa brings other attributes to the table as well. The National Capital Region is known for its highly skilled workforce with the highest ratio of post-secondary graduates in Canada, and our top-notch universities and colleges are graduating about 20,000 more grads each year. Ottawa also has a strong track record for building startups into world leaders: Canada’s last three successful tech IPOs involved firms based in the nation’s capital. The region’s tech firms also attract significant domestic and foreign venture capital and private equity investments.
The smart play for Ottawa’s tech community to be part of a winning bid is to join forces with Toronto and Waterloo. I believe that by working together, the three cities can be greater than the sum of their parts and position themselves as a strong competitor to Silicon Valley.
A digital supercluster will not give much of a boost to established Ottawa tech giants such as Shopify and Mitel, which will thrive regardless. But it would be a catalyst for the next generation of companies and entrepreneurs, which could benefit greatly from the investments and resources that a supercluster can offer as a global magnet for skills, capital and ideas.
Jeffrey Dale is the president of Snowy Cloud and the former president of the Ottawa Centre for Research and Innovation.