Letter from Canada: US's Loss Is Toronto's Brain Gain
It is now called the Silicon Valley of the North. Indians in the tech industry looking for a more ‘secure’ alternative to the US, are joining 230 other nationalities who call the city of Toronto their home.
 
With half its population born outside Canada, Toronto is considered the fastest growing workplace for the tech industry in North America, beating New York and San Francisco (SFO) in job creation. 
 
A 50-city survey of 2017 shows that Toronto added 22,500 new tech jobs, compared to 5,370 in New York and 11,540 in SFO. Coldwell Banker Richard Ellis (CBRE), a global realty group produced this survey -- the North American Scoring Tech Talent Report.
 
There are striking geographical similarities between Silicon Valley, California and Toronto's tech industry. The Valley is a 300-km-stretch of tech firms from Santa Rosa to San Francisco while Canada's ‘Silicon Valley’ is a 112-km stretch that begins in Toronto and stretches to the sister cities of Waterloo and Kitchener, making it the second-largest innovation super cluster in North America.  
 
It accounts for 60% of all innovation in Canada, and is home to over a thousand tech companies such as Google for Entrepreneurs Technology Hub and RIM (of Blackberry fame).
 
 
University of Waterloo, Canada's top engineering school, competes with Stanford and MIT (Massachusetts Institute of Technology), and is one of only three universities at which Google hunt for talent. The university also houses Velocity Garage - the world’s largest free start-up incubator for entrepreneurs.
 
 
“We were tired of watching Google poach on our best graduates from the University of Waterloo and suck them down to California,” said Canadian prime minister Justin Trudeau to Eric Schmidt, executive chairman of Alphabet Inc (which spawned Google), during an informal chat at a conference. 
 
While the exchange was light hearted, the industry is, in fact concerned about the drain of talented students from Canada’s top universities. This has led to a concerted effort to solidify the country's leadership role in Artificial Intelligence (AI) by pumping $125 million into a Pan-Canadian Artificial Intelligence Strategy to retain top academic talent and develop AI institutes.
 
The market for AI-related products is expected to reach $47 billion by 2020. There are also plans to boost Canada’s position in Fintech, clean technology, digital, health and biosciences is also on the charts with Ottawa's 2017 budget providing $950 million to build more "innovation super clusters" in the country and $2.2-billion in new clean-tech spending.
 
"Canada’s tech investment has reached $1.3 billion in the first quarter of 2018. This is an incredible feat for a country of only 36 million," says Abdullah Snobar, executive director at Ryerson University’s accelerator, The DMZ, in Toronto. DMZ is a leading accelerator for tech startups, helping them to network, mentor, and eventually scale their businesses.
 
According to a report by the Canadian Venture Capital and Private Equity Association (CVCA,) investments in ICT companies (information and communications technology) continued to receive the majority (64%) of total $1.1 billion, VC dollars invested in the first half of this year. 
 
The upward graph in tech investments is also due to Canada's traditional sectors embracing  AI or data to better their business, and thus creating more opportunities for investors in those sectors.
 
Research director, Darrell Pinto at the CVCA says, “The line of tech is getting blurred. It used to be very distinct silos between tech, clean tech, life sciences and agribusiness, but increasingly with the usage of AI, what we are seeing as a ‘tech investment’ could be what is a traditional life sciences investment.”
 
For instance, life sciences was a traditional pharmaceutical pipeline of growth (with investments). But the manner in which big data or AI is used in that sector, has become very valuable, and now applications of big data or even AI in different life science streams have become a big growth opportunity.
 
The farming sector has also seen an increase in tech investments as companies use and build satellite data to create intelligence around where and how to farm more efficiently.
 
The tech industry is also seeing some new interest from private equity firms. Economic realities of a bullish stock market and high company valuations has made it expensive to buy companies. 
 
And, over the last five years, the slump in the oil and gas sector, which, traditionally, was a big driver for private equity investment in Canada, has also forced them to hunt hard for companies with high returns.  
 
''What we see in the first half of 2018, is private equity firms making smaller deals into a non-traditional sector, for them, at least--- which is in tech," says Mr Pinto. 
 
A report on investments by private equity firms shows that the No1 investment is in the industrial and manufacturing (traditionally dollars come into this sector), but the second-largest is investments is in ICT or tech companies. "That's unusual, to see tech so high up on that list, in terms of dollars and number of deals."
 
Canada's brand as a country ripe for tech investments has also prompted the tech-focused California-based Silicon Valley Bank (SVB) to open a lending branch in Canada by next year.
 
With $51 billion in assets and, a global partnership with 2,300 VC and private equity funds, the Bank will provide in-market commercial banking solutions to Canadian companies and their investors in the Canadian tech and life sciences sector.
 
 
Barbara Dirks, head of SVB Canada, who spoke from California, says the Bank sees a great outlook for Canada as they see the large number of early stage companies, accelerators and the type of VC investment happening. 
 
This, combined with "fantastic growth" in the corporate ventures arm of many US companies like Microsoft and Google, makes for great opportunities for them.  
 
Ms Dirks says they have a ‘unique understanding of risk’ having been in the business for 35 years, dealing with all stages of a tech company. 
 
Connecting Canadian clients with VC managers in Asia, for instance, or providing them insights into what works and what does not is just some of the value-added services Canadian companies will gain from SVB's tech industry experience.
 
While all these domestic endeavours seem to be working, it must be underscored that the political uncertainty caused by Donald Trump’s policies have influenced the flow of talent from US to Canada.
 
A record number of companies have seen a 'doubling of resumes' from last year and chief executive officers (CEOs) are penning Op-Eds in the media of a "brain gain for the first time in years."
 
"Many folks who move here wish to have their own startups and its simpler than it used to be- say 10 years ago," says Vikram Rangnekar, a software engineer and an ex-employee of LinkedIn, who migrated from California in 2016. 
 
His website https://movnorth.com/, which gets huge traffic from the US-tech world and elsewhere, has progressed from fielding queries about Canada to matching prospective job-seekers with Canadian employers looking for talent.
  
But Canadian companies are also exploring opportunities outside ‘safe’ markets like the US and UK. 
 
For instance, Communitech, a Waterloo-based public-private innovation hub and Hyderabad-based T-Hub (a global startup catalyst), have teamed up for a Global Bridge Program, to help Canadian companies accelerate their business and look for opportunities in India. 
 
Canadian Digital Media Network, (CDMN), founded by Communitech, runs the Canadian program here and T-Hub handles the business at Hyderabad in India.
 
Scott Rairdan, specialist, international programs for CDMN says, "Canadian tech companies are recognising that the Canadian market is not large enough for them and so companies that we are working with know they have to go abroad." 
 
CDMN advises them on how to navigate foreign markets. 
 
Companies in clean tech, sustainable infrastructure, health, biotech and B2B enterprise solutions will be shortlisted and will then receive virtual coaching lessons to make them India-ready, while they work on validating their business models, pricing, and product adaption. 
 
In Hyderabad, they will be introduced to Indian companies and multinationals for sales and networking around the country. 
 
Canadian entrepreneurs plan to visit India for three weeks this November to start their journey with India. It will be interesting to see how this collaborative effort works out.
 
 (Rakshande Italia is an Indian journalist, who immigrated to Canada in 2001 and has worked with several top newspapers in India and Canada. She can be contacted on [email protected])
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COMMENTS

Shankar Pachari

2 months ago

Is Moneylife affiliated with "Movnorth" in any way? It is strange to see a specific immigration company mentioned in several ML articles related to Canada. It would be good if an unbiased source like Canadian government is quoted in the articles.

REPLY

Junaid Elsarraj

In Reply to Shankar Pachari 2 months ago

Mr Pachari, please read the article properly, Movenorth is not an immigration agency, its a website that matches employers with prospective employees looking for specific jobs in Canada. Think both he articles by the author were very well researched and informative.

Alibaba's Jack Ma to retire next year, Daniel Zhang to succeed
Alibaba's Executive Chairman Jack Ma will step down in September 2019 and hand over the reins to Chief Executive Daniel Zhang, the Chinese e-commerce giant said on Monday.
 
Ma, who co-founded the company almost 20 years ago which now is the world's biggest e-commerce behemoths, said in a letter to his employees that "transition demonstrates that Alibaba has stepped up from a company that relies on individuals, to one built on a culture of talent development".
 
Ma, who was a school teacher in China's small town of Hangzhou where Alibaba is headquartered and now one of the richest men in the world, will get to back to education, the billionaire said in a letter to his employees. 
 
On the company's 20th anniversary on September 10, 2019, Zhang will take charge as the new chairman.
 
The development comes days after his imminent retirement in a report by the New York Times, juked by the company.
 
"Ma will continue as the executive chairman of the company over the next 12 months to ensure a smooth transition to Zhang," a statement from the firm said. 
 
Ma's net worth is $36.6 billion.
 
Zhang, who was earlier the Chief Executive Officer (CEO) of Taobao, an online shopping portal owned by the Alibaba Group, was appointed the CEO of the group in 2015. He has been with the company since 2007.
 
The co-founder of the company, Ma, will however, remain as a board member of the Alibaba Group until the annual shareholder meet in 2020, which marks the 21st anniversary of the e-commerce and tech conglomerate.
 
"While remaining as executive chairman in the next 12 months, I will work closely with Daniel (Zhang) to ensure smooth transition," Ma said in a letter to the shareholders and employees on the occasion of the company's 19th anniversary on Monday.
 
The transition demonstrates that Alibaba has stepped up from a company that relies on individuals, to one built on a culture of talent development, Ma's letter addressed to the company's 86,000 employees said.
 
Ma, who turned 54, will remain a lifetime partner in the Alibaba Partnership and is a member of its partnership committee, the statement added.
 
The Alibaba Partnership has 36 partners, who are the senior management of Alibaba Group or its affiliates, including movie-making firm Alibaba Pictures, cloud computing firm Alibaba Cloud, financial services firm Ant Financial among others.
 
Founded in 1999, Alibaba stands among one of the largest companies in the world.
 
"I want to return to education, which excites me with so much blessing because this is what I love to do. The world is big, and I am still young, so I want to try new things," the Chinese business icon's letter added.
 
The group's e-tail portals Alibaba.com, Taobao, Tmall and AliExpress together clock billions of dollars of sales each year.
 
As per its statement, the company's revenue was $39.9 billion for fiscal 2017-18.
 
During the company's annual global shopping festival held on November 11 last year, the firm made a whopping $25 billion worth sales in a 24-hour period across its e-commerce platforms.
 
Apart from its online shopping portals, Alibaba also offers electronic payment services and cloud computing services.
 
Disclaimer: Information, facts or opinions expressed in this news article are presented as sourced from IANS and do not reflect views of Moneylife and hence Moneylife is not responsible or liable for the same. As a source and news provider, IANS is responsible for accuracy, completeness, suitability and validity of any information in this article.

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Billionarie Liu Qiangdong's arrest in US sparks outrage in China
The arrest of Liu Qiangdong, the chief executive of JD.com, has shocked Chinese society, which on Monday demanded more information about the alleged sexual misconduct of one of the country's richest men.
 
"Liu Qiangdong" and related tags were among the most searched on microblogging site Weibo - one of China's most popular social platforms, Efe said quoting the China Daily newspaper.
 
Around 22,000 of the 27,000 followers of the company's official account shared the statement it issued on the matter saying that Liu was questioned by the police in Minnesota.
 
The founder of the Asian e-commerce giant was arrested in Minnesota in the United States on Friday for alleged criminal sexual conduct and was released a day later, according to US media reports.
 
The Minneapolis Police Department told The New York Times daily that, although the magnate has been released, they are treating the case as an active investigation.
 
Questioned by the media during her regular press briefing, Chinese foreign ministry spokesperson Hua Chunying said the "consulate general in Chicago is closely following the relevant situation."
 
"We are trying to verify that with relevant departments," she added.
 
The 45-year-old businessman, who has over 4 million followers on Weibo, has been married since 2015 to 25-year-old internet celebrity Zhang Zetian, with whom he has a daughter.
 
JD.com, which is listed on Nasdaq New York, is considered the Chinese rival of the US e-commerce site, Amazon, and is the second biggest e-commerce company in China, after the Alibaba Group.
 
Disclaimer: Information, facts or opinions expressed in this news article are presented as sourced from IANS and do not reflect views of Moneylife and hence Moneylife is not responsible or liable for the same. As a source and news provider, IANS is responsible for accuracy, completeness, suitability and validity of any information in this article.

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COMMENTS

Mohan Krishnan

3 months ago

Sexual misconduct with female (or Male) is a resume builder for Hollywood.

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