By Jack Derricourt & Chris Hogg
The Canadian technology landscape is booming.
Canadian companies took in $2.5 billion in funding in the first half of 2018, the strongest first half since 2000. Corporates have announced large-scale investment plans to invest in innovation and digital technology (CAE recently pegged $1 billion for the efforts) and post-secondary institutions are breaking ground to house future generations of talent (the University of Toronto is building a 14-storey building to be completed by 2021).
The Canadian technology landscape is ripening and readying for an influx and growth of more mature, internationally-focused ventures.
While scaleups make up less than five percent of Canadian companies, they create half of all new jobs in the country.
On September 26 in Toronto, Elevate ScaleUp will seek to provide helpful insights into the problems facing scaling companies. Presented by CIBC and Osler, the event features startup veterans sharing their experiences.
DX Journal spoke with Julia Kassam, Managing Director, CIBC Innovation Banking, to find out more about the next big act in Canada’s innovation space.
DX Journal: With innovation ecosystems forming across Canadian cities, what excites you the most for startups in Canada?
Julia Kassam: From coast to coast, we’ve hit our stride as a community. The Canadian startup ecosystem has never been stronger and it is launching Canada into the global spotlight. Success stories about scaling companies of all sizes, in different industries, are generating the attention of investors and aspiring entrepreneurs. We are gaining a reputation for being diverse, collaborative and competitive.
This means that Canada is no longer an occasional destination, but a critical location for international investors to regularly visit, and for global brands to establish roots and drive their own corporate growth.
DX Journal: Canadian policymakers have made strengthening the venture capital sector a priority, with the launch of Venture Capital Action Plan (VCAP) and Venture Capital Catalyst Initiative (VCCI) underway. What does that mean for startups and scaleups?
Kassam: After years of lobbying by the Canadian Venture and Private Equity Association (CVCA), the previous government took our sector’s advice and launched VCAP as an arms-length funding strategy. VCAP worked as designed; venture capital funds benefited from the capital raised and invested in several early-stage companies. The new funds that should be raised under VCCI will capitalize on that success and strengthen the sustainability of Canada’s venture capital ecosystem.
What this means for entrepreneurs is that the federal government recognizes that VCAP was an appropriate initiative, and that to fuel the innovation economy, companies need a robust venture capital ecosystem to move from startup mode to scaleup mode.
It’s a really strategic and exciting initiative because later-stage capital will help accelerate the growth for companies who need to overcome commercialization hurdles, expand into new markets and compete on a global scale.
DX Journal: Many startups struggle to scale because they don’t have the right senior talent. What is your sense of how well positioned Canada is with experienced leaders?
Kassam: Although Canada has established a reputation for developing world-class academics and innovators, we do need to attract experienced executive talent. Everything moves at an accelerated pace in a scaleup, and the business will bend and flex in ways it never has. Canada needs more leaders who know what it takes to grow globally and ensure scaleups are well-equipped to navigate and accelerate growth.
One big benefit Canada has that helps here is as a result of our proactive immigration policy – the ability for Canadian scaleups to attract skilled talent is getting easier; our country realizes that to keep pace with scaleups, concentrated efforts are needed to establish Canada as a global technology powerhouse.
DX Journal: Canada has also been able to attract tech titans such as Google to open up offices in Toronto. What role do they play in the scaleup economy?
Kassam: They serve as training ground, but also as a competitor for talent. In the best case, people learn what it takes to be part of a leading innovator while being trained by experienced executive talent at the local divisions of firms such as Cisco or Google. For scaling companies, the opportunity to pilot their innovation becomes a realistic opportunity which can flourish into a partnership that may lead to an acquisition. A big opportunity that emerges as a result of large tech companies choosing to set-up an office in Canada is an acceleration of human capital development for the ecosystem.
What we are also seeing more of is that global innovators are setting up their R&D centres in Canada. A great example this summer was Samsung announcing an AI Centre located within MaRS, led by a Toronto-based academic. Again, another opportunity for scaleups to be close to the heart of global innovation. That is huge potential waiting to be unleashed.
DX Journal: How is the Canadian startup ecosystem helping to train talent?
Kassam: Serial entrepreneurs and investors share mistakes and success stories which help shape and accelerate scaleups through collective learning. What truly makes the Canadian tech ecosystem unique is our mindset to foster entrepreneurial spirit; and a great example of how we do that is by bringing the startup community together.
Elevate, Canada’s largest tech festival and one that CIBC Innovation Banking is sponsoring, is the perfect example of creating the right information and network opportunities so that we can collectively benefit from the existing momentum in Canada’s innovation ecosystem and drive our entrepreneurial culture forward.
DX Journal: What’s the next step for the Canadian scaleup story?
Kassam: Canadian scaleups will continue to tackle the unique challenges that come with scaling a business; however, they will think in a global context earlier than ever before. Scaleups need to strategically choose the right capital partners for their growth – ones that open doors to new markets. There needs to be an emphasis on attracting top talent earlier in the growth cycle to help drive international perspectives and opportunities.
To hear more from industry leaders who have scaled real businesses (and have the scars to prove it), get a ticket for Elevate ScaleUp, happening September 26, 2018 in Toronto. Presented by CIBC Innovation Banking and Osler, the event will provide real insights from entrepreneurs and tech veterans who have spent years in the field, on everything from hiring, to financing, to distribution.
DX Journal covers the impact of digital transformation (DX) initiatives worldwide across multiple industries.
Where will AI go next?￼
This year’s Collision conference featured a wide range of buzzy AI solutions — both B2B and for consumers.
The buzzy topic of AI was not in short supply at this year’s annual Collision conference in Toronto. The list of applications using the technology was seemingly endless — from both the presenters and exhibitors.
It comes at a unique time, as analysis of the industry reveals that we’ve crossed into the “era of deployment.” At the same time, it’s imperative that we think critically and ask questions about said deployment.
In June, Research and Markets revealed a study demonstrating how the AI industry has experienced immense expansion and maturation in recent years, from a $62B market in 2020, to projections saying 40% growth annually until 2026.
Meanwhile, the 2023 AI Index, an independent initiative at the Stanford Institute for Human-Centered Artificial Intelligence (HAI), reports that:
- AI systems can both have a large carbon footprint (when training), and be “used to optimize energy use”
- Incidents of AI misuse is “rapidly” on the rise. As the Stanford team explains, ‘more AI, more problems”
- There was a 27% decrease in Global AI private investment (year-over-year) from 2021 to 2022. At the same time, over the last decade, investment has increased — in 2022, it was 18 times greater than in 2013.
- Companies that have adopted AI are pulling ahead, while the proportion of those adopting AI has actually plateaued.
- Only 35% of Americans surveyed agree that “products and services using AI had more benefits than drawbacks,” compared to 78% of Chinese respondents, 76% from Saudi Arabia, and 71% from India.
It seems clear that the sector is at something of a crossroads.
DX Journal spoke to four AI startups at Collision, covering areas like filing taxes, DIY home and appliance repair, game building, and building work teams — all showing how AI can have an impact both at home and the workplace.
DIY home maintenance, with a little AI help
Collision presenter Eradj Khaidarov, Chief Technology Officer of IrisCX, spoke on the topic of “Delivering a more human experience through visual intelligence and AI.” He transitioned from twenty years in the video conferencing field to IrisCX, a video-based troubleshooting app that helps users with DIY repair. Anything from appliances to home devices, AI determines the make, model, problem, and spits out possible solutions.
“All of us hate dealing with manuals from 10 years ago and only keep them around when we truly need them — and we also hate dealing with YouTube videos that may not necessarily answer all our questions,” he explained. “The interactions with our product can help you get to an answer faster, without having someone come to your home. It’s just the little bit of guidance that can help us solve a problem quickly and efficiently.”
AI allows the app to summarize certain markers in the conversation, to formulate what was truly the problem.
Let AI help find your next hire
Meanwhile, Raphael Ouzan, co-founder & CEO of A.Team, wants AI to revolutionize how people build teams.
Prior to helping found the startup, he served in the Israeli military for five years in cyberwarfare and cryptology, “finding the power-people you could work with, even in impossible missions.”
Later, he built teams as he built start-ups, and realized he wanted to build something that would enable anyone to find the right teammate — or teammates — to accomplish a greater goal.
When a user logs in to A.Team, they will do a search for their preferred skill and industry, while the AI will detect keywords, suggesting the relevant team that matches the work desired.
“I would describe it as a platform that enables the formation, management, and scaling of elite tech teams that drive massive change for companies,” he said.
“You can look at it like a high-end UpWork, for teams.”
A.Team has raised $55 million, funded by the likes of rapper Jay-Z, and has advisors that include Fiverr founder Shai Wininger and former UpWork CEO Stephane Kasriel.
Creativity + AI
One very popular area where AI is being leveraged is for imagery, game creation, and video creation.
Unity offers tools and solutions for game developers, industrial customers, and professional artists. And as Chief Marketing Officer Carol Carpenter explains, “what we are seeing is that every pixel, every piece of art, every frame will be compacted on the creative side by AI.”
“If you draw two frames, then ask: ‘hey, draw ten more for me like this.’ Or, I want a scene in a digital twin or game, with snowing mountains. AI can offer some art to choose from.”
One of their newest products, Unity Muse, launched during Collision. As Carpenter describes, it “has a feel like ChatGPT, where programmers can type in an image request, and either see it animated or developed on-demand.”
For example, the user could input the text: “Ferrari driving down a steep hill,” and what would pop out would be AI’s creation based on the request. The user could decide to keep it as a standalone graphic, or instruct Unity Muse to make the image animate.
From there, the sky’s the limit, although a human hand — and creativity — will always play a part.
To build a game today with real time 3D, she explains, what’s required is experience and coding knowledge. “It’s not something you just pick up and do easily.”
With Unity, there’s an “ability to use natural language to create, to accelerate the process,” said Carpenter. “We still very much believe the creator needs to have ideas; they need to have the spark of imagination. AI is good for getting started or a prototype. Then there needs to be polish and human element of judgment.”
Your taxes, automated
Many believe that the best place to deploy AI is for truly mundane tasks that make sense to automate.
In that vein, Ben Borodach and his team have brought it to tax filing.
April is touted as the first AI-powered tax system that both optimizes and files taxes, via a large language model and proprietary generative AI that reads tax law.
“It doesn’t matter if you’re an Uber driver, an e-commerce seller, or a family with two jobs, you still get the same experience,” explained the co-founder and CEO. “A personalized leveraging of AI, where we serve up 1.2 septillion unique paths to filing returns. So every single person gets a customized flow for their specific experience.”
There are, Borodach explained, thousands of possible tax questions across federal, state, and local jurisdictions that a taxpayer could be asked. Each time the user answers a question, the program learns more about the user.
As AI technologies evolve, its growth is poised to reshape virtually every field it touches.
It is already entering our lives in an accessible, individualized way, catering to the unique needs of each user. From healthcare and education to finance and entertainment, its capabilities will soon permeate unexpected areas, transforming our lives in profound ways.
Dave is a journalist whose work has appeared in more than 100 media outlets around the world, including BBC, National Post, Washington Times, Globe and Mail, New York Times, Baltimore Sun.
Global innovation comes to Collision
1,727 startups and partners from 76 countries descended on Toronto for one of the world’s largest tech events.
Hoping to collide with angels and investors, nearly two thousands startups and partners from 76 countries and thirty industries convened at Collision in Toronto.
For attendees, it was a chance to take a peek at the future of tech. For exhibitors and startups, an all-access pass to global players, all under one roof. Indeed, floor exhibitors spanned the globe: Italy, Kosovo, Portugal, South Korea, and more.
The worldwide innovation and startup scene has had a rollercoaster few years. 2021 saw next-level growth, a trend that continued into 2022, until conflict and an energy crisis in Europe, supply-chain disruptions, layoffs, and inflation meant a period of instability. This has lasted into 2023, though at this midpoint of the year, there’s been an upswing.
According to Startup Genome’s Global Startup Ecosystem Report 2023 — generated from analysis of data from 3.5 million startups across 290 global ecosystems — VC funding is still down, although gaming, blockchain, and fintech all saw increases. The AI and Big Data sub-sector has the highest number of total VC deals, with 28% of the global share.
Entrepreneurs from around the world are seizing opportunities to disrupt industries, solve pressing challenges, and create innovative solutions. Collision is just one place to help make that happen.
Here’s a look at four countries that came to town.
Kosovo’s rapid growth
At just fifteen years old, the small Balkan nation of Kosovo came to Collision hoping to position itself as a burgeoning tech incubator — with a workforce less costly than most others in Europe.
Representing the country were Sedat Burrniku, Toronto’s Consul of Kosovo, and Fatos Idrizi from Pristina-based Kreahub, a company that mainly does web design, web development, branding, and digital marketing. Tenton, a software development company from Kosovo, was also part of the team.
“Kosovo is a young country. It has a lot of potential in IT, among other fields and concepts. So, we would like to introduce our companies to the rest of the world,” Idrizi said, adding that his country has one of the highest Internet user rates in Europe, at 96.4% among a population of nearly two million.
One of their biggest success stories was a made-in-Kosovo project dubbed “NatEv Explorer,” that detects natural disasters and catastrophes around the world, and won the NASA International Space Apps Challenge in 2015.
“Kreahub is a young company with potential ahead,” explained Idrizi. “It is a first year for us. We finished, already, four projects in the US, one in Germany, and one in Switzerland. So, there is a huge market ahead. Also, today, I got a call for another project in the US.”
Last year, Forbes featured an op-ed by Fatos Ameti, CEO of the Kosovo-based Sonnect, outlining the country as a “one to watch” in the tech and IT industries. He noted that the information/communications tech ecosystem, “is extensive, with numerous labs, innovation centers and workspaces… that provide startups with mentoring, financing, incubation, training and co-working spaces.”
Portugal: small but mighty
“Portugal is not a very big country, and Canada is a very big market, and a way to enter a greater market – which is North American. So, there are a lot of startups looking for greater investments or to scale to different markets,” she said.
“We have a lot of different verticals that are growing strong in Lisbon. We have Web3. We are also investing in fintech, impact, mobility is also strong,” she said, adding that startups in Lisbon are especially focused on health tech, sports tech, and gaming.
To date, she said Lisbon boasts seven unicorns.
“The companies that want to scale to high levels of investment have to leave the country. What we are doing is trying to change this situation, bringing more investors to Portugal,” she said.
“It happens all the time that when they learn what is going on there, hear the pitches, they get interested. The trick is to let him hear. Sometimes it’s hard for investors to have that space, but when they do have that space, the opportunities are there.”
While Rome and Milan both have active startup ecosystems, Startup Genome’s report lists Turin as one of the top 35 European ecosystems for affordable talent. With over 110k students, it’s easy to see why. An in-the-works Italy Digital Nomad Visa will also boost numbers to both the country and region. The northern city is specifically cultivating growth in the areas of Smart Cities, space technology, and AI, Big Data, and analytics.
And in the fintech space, Mara Vendramin — founder and CEO of My Money — was at Collision’s Italy pavilion showing off a completely biometric form of handheld payment device that uses a fingerprint instead of a plastic debit/credit card — just one of the country’s 12,000+ startups.
“Most importantly, it will democratize payment for everyone. Because today, the latest technology you can use to pay is with a smartphone – an expensive smartphone. With our system, all the people around the world will be able to pay, even if they don’t have a smartphone.”
Fraud will be “impossible” because fingerprint readers are FBI certified, she said. “For example, if I chop your finger and use it to pay, it will not work. The readers have ‘liveness’ detection. So, they will be able to realize if the finger is alive or real.” This will, she hopes, eliminate credit card fraud, and streamline faster payment at store kiosks.
South Korea at the forefront of innovation
South Korea does have a reputation as a tech and innovation centre — after all, it’s the home of companies like Samsung and LG. But as a startup ecosystem, it’s one of the world’s most thriving. In fact, Startup Genome has Seoul at #12 in its global ranking. It’s also in the top 15 for knowledge and for talent and experience. The ecosystem’s strengths? AI/Big Data/Analytics, life sciences, and advanced manufacturing and robotics, reports Startup Genome.
At Collision, Hyunjin Shin, CEO and co-founder of Seoul’s Hudson.ai, is featuring their AI-powered dubbing solution to the film industry. It matches translated audio with natural mouth movement in any language or voice.
“Sometimes, people are struggling to see a movie because of subtitles or the awkward dubbing,” she said. “The voice actor’s voice is sometimes really different from the original content. Also, it doesn’t match the lip and sound. It makes you very disengaged. We would like to tackle that problem with generated AI technology.”
With a staff of nine, in its first year they have already dubbed two Korean feature films. She said the company is hoping to gain a foothold in documentary films and US major motion pictures.
Like countless other South Korean startups, Hudson.ai benefits from their government’s support, Shin added. “They also have many programs to help accelerate an early stage company – especially tech companies,” she said. “My country has more and more an entrepreneurial culture, with mentorship, funding, and networking opportunities.”
Companies like e-commerce app Coupang and mobile platform Kakao have achieved significant growth and valuation, inspiring and attracting aspiring entrepreneurs, she explained.
The interconnectedness fostered by Collision has created a fertile ground for innovation, where diverse perspectives and expertise converge to tackle complex global challenges.
As a four-day innovation station, no doubt many deals were made — a testament to these startups’ hotbed of creativity, disruption, and economic growth potential. The global startup ecosystem continues to thrive, pushing the boundaries of what is possible and shaping the future of industries worldwide.
Dave is a journalist whose work has appeared in more than 100 media outlets around the world, including BBC, National Post, Washington Times, Globe and Mail, New York Times, Baltimore Sun.
At Toronto tech show, second thoughts emerge over AI
Months after the spectacular launch of ChatGPT, the AI revolution is well underway but hints of caution are emerging, especially over letting one or two companies reign supreme.
The release of the poem-churning app by San Francisco-based OpenAI came at an opportune time for tech, landing just when the US giants were laying off thousands of workers and startups faced a funding winter after the collapse of cryptocurrencies.
While generative AI’s powers spooked many, even drawing calls for a freeze in its development, the tech world welcomed the respite from an otherwise miserable 2022 when a pandemic-era tech boom imploded.
But the crowds of startups and their backers meeting at the three-day Collision conference in Toronto heard second thoughts about artificial intelligence, even if convictions remained strong that it was here to stay.
“We’re about three steps into a 10K race,” said Adam Selipsky, the head of Amazon-owned AWS, the world’s biggest cloud company that is set to see a huge windfall from the AI excitement.
“The question is: where are the runners going? What’s the course like? Who’s watching the race?” Selipsky told a packed conference hall near the shores of Lake Ontario.
AWS is the archrival of Microsoft, the Redmond, Washington-based company that took the world by surprise earlier this year by diving head first into the ChatGPT goldrush.
Microsoft’s investment of billions of dollars into OpenAI launched an AI arms race, with Google following course by ramping up its release of AI-infused products, goading any company involved with technology to hurry out new capabilities.
“Like a lot of things, I think AI is overhyped in the short term and underhyped in the long term,” said Jordan Jacobs of Radical Ventures, a venture capital firm that has invested heavily in AI.
“But the difference with AI is that once you deploy it, it gets better and better and better,” meaning there is a real downside to coming in second place.
He said this was not the case with the advent of the personal computer or the smartphone, when those who waited, like Apple, were the companies that won.
The benefit of coming out first seems to leave OpenAI and its powerful Microsoft backer in the driver’s seat.
But AWS’s Selipsky and others cautioned about going all-in with one big company, especially with a technology that voraciously feeds off data and computing power.
– ‘Choice’ –
Hundreds of companies and governments have gone as far to ban their employees from using ChatGPT, worried that sensitive information will be uploaded to strengthen OpenAI’s large language model, becoming available to all.
One of the “most important things that we hear from customers around the world all the time is choice,” Selipsky said.
“The world needs access to a whole bunch of models in a place that you trust and with the security you demand,” he said.
At Collision, Booking.com, the online travel giant, announced a new product using OpenAI’s ChatGPT that will provide a conversational experience for users planning trips.
“This is just a start,” Rob Francis, chief technology officer of Booking.com told AFP, all the while defending the company’s turn to OpenAI.
Models from the likes of OpenAI or Google, “they’re great for general purpose” like a chat about holiday plans, he said.
But for more sensitive uses, companies will “start to run their own more tailored models, in their own environment,” he said.
As the world’s biggest companies rushed out their AI products, the startup community was warned not to take too much solace from the hype sparked by ChatGPT.
Even if generative AI has caught the world’s attention, “people are still approaching startup investment through a cautionary lens,” Vincent Harrison of PitchBook, the business research company, told AFP.
“Deal activity is down, fundraising is down, the IPO environment is probably the worst that it’s been since the global financial crisis,” Harrison said.
“I think ChatGPT blew the minds of a lot of people… but is AI enough to bring things where we saw them in 2021? I don’t think so.”
Events2 months ago
Where will AI go next?￼
Business4 months ago
How to build company culture in a scale-up
Events5 months ago
The innovator’s mindset and the battle between Batman-v-Superman: mesh conference day 2
Business3 months ago
How to build and maintain a company culture among a remote workforce
Technology6 months ago
How are AI tools like ChatGPT deployed in retail?