VOL. 1, ISSUE 1
3, 2, 1 ...
liftoff!
Premiere issue of TECHOPIA launches to explore resurgence of technology in Ottawa
THURSDAY, JUNE 11, 2015
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IT’S BACK,
baby!
incredible energy in Ottawa today that didn’t exist 10 years ago,” says Finkelstein. “Now people in Ottawa want to have world-class talent, they want to work for world-class companies, and they want to sell to a global audience.” He attributes part of this growth to a grassroots movement in town. Groups, such as Fresh Founders, a local entrepreneurs club, decided that Ottawa has the potential to be a place for highgrowth companies.
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BY ALEXIA NAIDOO
BRUCE LAZENBY
PRESIDENT AND CEO, INVEST OTTAWA
THURSDAY, JUNE 11, 2015
It’s never been better than it is right now for Ottawa’s technology landscape, according to a preponderance of the city’s tech leaders. After going through massive upheaval in the 2000s, a full-fledged tech resurgence is underway.
“A lot of people in Ottawa didn’t move away when the big players, like Nortel, disappeared,” says Bruce Lazenby, Invest Ottawa’s president and CEO. “As a result of that, companies like Ciena, Avaya, Ericsson, AlcatelLucent, Cisco, and Huawei, among others, have started moving in to take advantage of that pool of talent.” But this isn’t just a phoenix rising from the ashes of defunct companies. The diversity of the sector, particularly in software, is greater than ever. Harley Finkelstein, Shopify’s chief platform officer, believes it’s as good, if not better, than it’s ever been in Ottawa for technology in terms of access to capital, access to talent, support and role models for younger companies. “Technology is completely rejuvenated now. There is an
HARLEY FINKELSTEIN
CHIEF PLATFORM OFFICER, SHOPIFY
“It was just a group of us, who cared deeply and passionately about the Ottawa technology scene, that used to meet at a coffee shop,” says Finkelstein. “Now we’re a couple hundred people meeting at Shopify’s offices.”
JASON FLICK
THURSDAY, JUNE 11, 2015
CEO AND CO-FOUNDER, YOUI.TV
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Jason Flick, a serial entrepreneur who recently joined the board of Invest Ottawa, says he has watched the evolution from “cash-rich, venturebacked” hardware companies and “over-funded” software companies from 1999-2004 to today’s “incredible boot-strapped companies that are finally hitting their stride.” The Youi.tv CEO and cofounder adds, “I think the huge IPO hits in Ottawa this year underscore what we have, but that’s just the start. It takes five to seven years to get a company off the ground and we are seeing gems surface now.” Flick says his Youi.tv venture has grown quietly, doubling in size every year from “an irrelevance of three guys to more than 135.” And his company has
Ottawa is a place that’s always built things. We’ve been doing it for 50-plus years, even preceding Silicon Valley. There are people quietly creating some pretty cool things here,” he says. “We need more of them to think about whether or not they could build a business around their ideas. Celebrating the culture of startups and entrepreneurship is great, but at the end of the day you have to go past that boosterism and get to building real products.
LUC LALANDE, EXECUTIVE DIRECTOR OF THE ENTREPRENEURSHIP HUB AT THE UNIVERSITY OF OTTAWA
already booked enough revenue to double again next year. He sees the region’s new tech sector flagship company, Shopify, as a proof point for the long-term impact of emerging entrepreneurs. “I have big hopes for the next big startups spawned from them.”
DEBBIE PINARD CEO, INITLIVE
Debbie Pinard, CEO of her own startup called InitLive, points to another gathering that’s taken off: Tech Tuesday, an event hosted by Wesley Clover. “In the last year, it’s full to the rafters with people who are interested in networking and finding out what’s going on in the hi-tech community in Ottawa,” she says. Pinard is noticing more tech business names appearing on Ottawa office space, as well as job postings and career fairs. “It’s getting harder to hire which is a good indicator. A good Android or iOS app developer gets pretty hard to find.” Developing and attracting people with the requisite skills is part of the challenge. In Ottawa, colleges and universities have collectively 120,000 students, about 27,000 of which are in science, technology, engineering, and math. Luc Lalande, executive director of the Entrepreneurship Hub at the University of Ottawa, is working to make Ottawa a destination for innovators by supporting students from all fields in gaining entrepreneurial skills.
“Ottawa is a place that’s always built things. We’ve been doing it for 50-plus years, even preceding Silicon Valley. There are people quietly creating some pretty cool things here,” he says. “We need more of them to think about whether or not they could build a business around their ideas. Celebrating the culture of startups and entrepreneurship is great, but at the end of the day you have to go past that boosterism and get to building real products.” If we want to take our place as a world-class tech city, what are the main challenges in doing that? Having a more active angel community and more access to venture capital funds are key, says Pinard. “We’ve got L-Spark and Wesley Clover, Invest Ottawa and the universities offering money. It’s not a lot, but at least it’s seed money to get a couple of guys working for two or three months.”
LUC LALANDE
EXECUTIVE DIRECTOR, ENTREPRENEURSHIP HUB, UNIVERSITY OF OTTAWA
Finkelstein agrees that investment is needed, but says the region’s strengths far outweigh its weaknesses. “I would challenge anyone to find a better city to build a multibillion-dollar company than Ottawa.”
MOVE OVER SILICON,
hel l o GALLIUM NITRIDE
GaN could be the beginning of ‘Gallium Valley North’
BY DAVID SALI
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What the heck is gallium nitride?
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Girvan Patterson is president of GaN Systems Inc. FILE PHOTO
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It’s fitting that GaN Systems is suddenly growing at what feels like lightning speed. The Kanata-based company is poised to become a leader in the burgeoning field of ultra-fast, highly efficient semiconductors that use gallium nitride rather than silicon, says president Girvan Patterson. “We’ve been around about eight years, and the first five or so we say we were missionaries,” he says. “We were out explaining to people what gallium nitride is and what it was going to do for the world. That completely changed about two or three years ago, when suddenly the big guys – the carmakers, the television makers, the power supply makers – they all said, ‘OK, we get it now. Now we see where GaN’s going.’ They started coming to us and saying, ‘OK, what can you offer us?’” Gallium nitride semiconductors convert 99 per cent of the energy they receive, compared with 95 per cent for those that use silicon. That might not seem like a huge difference, but Mr. Patterson says the new generation of semiconductors are faster and much more efficient.
That in turn has a wide range of benefits for a host of manufacturers. For example, gallium nitride semiconductors will help make flat-screen TVs even lighter and thinner and air conditioners more energyefficient, he says. GaN’s products could also have huge implications for the automotive industry, which Mr. Patterson calls “the huge holy grail of the business.” For example, batteries used in current hybrid vehicles generate such intense heat the cars require separate coolant tanks. Because gallium nitride semiconductors bleed much less energy, coolant tanks would no longer be necessary. The power switching market is currently worth about $59 billion, Mr. Patterson says, and he believes gallium nitride semiconductors will soon grab a $10-billion share of that total. As one of only a handful of companies in the world capable of producing the new technology, GaN is well-positioned to win a hefty chunk of that business, he adds. “Suddenly, now it’s mainstream,” Mr. Patterson says. “No one’s questioning the future
Gallium nitride, or GaN, is a compound known for its incredibly high heat capacity and conductivity, making it an ideal material for semiconductors. Its base element is gallium, a soft, silvery metal which isn’t found in nature but is a byproduct of the production of aluminum and zinc. In 2012, about 273 tonnes of gallium were produced around the world. Over the past decade, manufacturers have begun using gallium nitride in products such as LED flashlights and Blu-ray Discs. But its commercial applications have yet to be fully exploited, says Girvan Patterson, the president of local semiconductor firm GaN Systems. “It’s readily available,” he says. “It’s just learning how to harness it.” Ottawa has played a key role in that process stretching back to the late 1990s, when Nortel manufactured early prototypes of gallium nitride transistors with help from the National Research Council. “We’ve been doing it a long time here,” Mr. Patterson says. “We don’t have to go far to get some terrific people. It’s been a huge asset.” Only about five companies worldwide are even attempting to produce gallium nitride transistors, he adds, largely because a specially equipped foundry is needed to create the compound. One of the rare facilities with that capacity just happens to be at the NRC, a short drive from GaN Systems’ headquarters in Kanata. “We were one of the few companies that had the possibility of even (making) any when we started experimenting,” says Mr. Patterson. “It was fortuitous. We had the infrastructure presence here in Ottawa to do it and we had the opportunity and the motivation.”
of power switching is going to be gallium nitride. It’s a huge opportunity. It’s just a question of how quickly we can ramp things up. We’re not a niche startup any more.” Investors are clearly taking notice. GaN Systems, which previously landed two rounds of seed funding in 2011 and 2012, recently secured $20 million in series C financing from a group that was led by Montreal’s Cycle Capital Management and also included BDC Capital, Beijingbased Tsing Capital, Vancouver’s Chrysalix Energy Venture Capital and RockPort Capital of Boston. The company, which has nearly tripled its headcount to 31 over the past three years, plans to use the newfound capital to ramp up its sales and marketing staff and hire more engineers to work with clients. It began shipping prototypes to hundreds of potential customers last year and expects to have products on the market by the fall. GaN Systems already has sales offices in Michigan, Germany, the U.K. and Japan, and is planning to soon open another in Taiwan, where the wafers for its transistors are manufactured. Mr. Patterson says over the past eight years, the company has evolved from a fledgling outfit with six employees and a good idea to a “real producer” of technology that could revolutionize the semiconductor industry. An electrical engineer by trade, he has had key roles in launching a number of technology firms over the past three decades, including Orcatech and Plaintree Systems. But none can match GaN Systems’ potential to disrupt the global marketplace, he says. “I’ve done a lot of startups in my career,” Mr. Patterson says, “but this is by far the most exciting of them all.”
unCOMFORT
ZONE
Editor’s Note: Kyle Braatz is a serial entrepreneur with deep roots in Ottawa, including a degree from Telfer School of Management and co-founder of Simply Story Videos and Health Wave. He recently relocated to California and will regularly contribute to TECHOPIA to give local readers the latest from down south.
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We needed something that we could work on for the rest of our lives without ever becoming bored.
launched across the USA and the growth continued, 20 per cent month-over-month with minimal roadblocks. (We credit a lot of our early success to the Ottawa community where we had access to talent, mentors, and solid early-stage investors.) We were in a good place, which truly felt uncomfortable. It was time to push our limits and step outside our comfort zone ... again … from a budget and experience perspective. We hired, grew, raised capital, hired more and moved closer to our vision. Over the coming months I will take you through the emotional journey that started at the end of 2013 with nothing but my car, my wife, my two dogs and eventually ended with our round getting closed. But that was after running out of cash, downsizing, depression, acquisition offers, a change in direction and finally … multiple term sheets! We took uncomfortable to a whole new level. In the end, it paid off and I am excited to share this chapter of the story with everyone. Kyle can be contacted on Twitter at @ braatzy.
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ntrepreneurs are fueled by living outside their comfort zone. When things get comfortable, they always find a way to push the envelope. I know this first hand. For me, pushing the envelope means starting companies. When I was 10 years old, I sold devil sticks. When I was 16, I started a handyman business. When I was 19, I started a beer distribution company in my university residence. (I watched Scarface too late to save that business.) My next venture was a little more real. In 2005, I lost someone close to me to cancer and later decided to cycle across Canada (with three friends) to honour his life and raise a little money for the Canadian Cancer Society. To make a real impact we needed to invest a lot. We needed to build the venture like we would build a startup. I dropped out of school for a year, leveraged credit to build a brand and web presence, raised money from family and friends by selling branded sweatshirts, raised more money through corporate
sponsorships and partnered with firefighters across Canada (who are more susceptible to cancer) to co-ordinate events at each one of our stops. (This was our distribution strategy.) In one summer, we cycled 8,200 kilometres, raised more than $150,000 and, most importantly, we told the stories of more than 72 inspiring Canadians who battled cancer. The chaos and uncertainty that came with building Typically Canadian was like a drug that I craved and I was fortunate to hire a web developer who craved the same chaos I did. My new co-founder and I would go on to run a design company during our last year in university. During this time, I lived three months behind in rent and carried a balance of $20,000 on my credit card. (Remember what I said about comfort zone?) The thing is I believed in what we were doing and felt pretty comfortable with where we were at and what we were going to accomplish. During the next two years we would create a hosted PBX software and an e-commerce platform for direct selling. They both failed. We also created Simple Story Videos (SSV), which we quickly built into a seven-figure business that has grown 60 per cent year-over-year since inception. The problem was that my co-founder and I loved creating SSV, but we wanted more. Thankfully, we had an amazing management team in place to run that company while we focused on our next venture.
(P.S. I found a second passion, helping other people flourish as entrepreneurs.) We reflected on why we weren’t fulfilled with SSV and believed the reason was two fold: 1. We needed something we were passionate about. 2. We needed an outrageously big vision filled with outrageously hard problems to solve along the way. We needed something that we could work on for the rest of our lives without ever becoming bored. HealthWave was the perfect outlet, born with a vision of creating a more integrative health care system. We launched the company in 2012, saw great traction and raised a round of funding from some amazing Ottawa angels. In 2013, we
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Right now we (Canada) have been pretty passive players. We just take whatever we get and that’s it. And I’d like to change that. TONY BAILETTI, PROFESSOR AND BUSINESS GURU, CARLETON UNIVERSITY
THE KIDS ARE RIGHT
The capital’s new cybersecurity society has ramped up plans to turn Canada into a “global leader” in the sector not even two years after the initial idea was hatched. BY ADAM FEIBEL
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on its own, whether government or industry, could do on their own.” Backed by a number of major public- and privatesector sponsors, VENUS has “lofty” goals to build Canada’s intellectual and industrial capacity to become leaders in cybersecurity. One of the organization’s lead projects involves a partnership with Telus that will assess the cybersecurity needs of Canada’s roughly 3,800 municipal governments and lobby for provincial legislation that would enforce standardized levels of security that each municipality would have to meet based on its needs. “That’ll help drive growth,” says Jeffrey Tracey, VENUS’s director of business development. “These ventures, the companies we’re trying to develop … we want them to be able to sell their technologies into these organizations.” The Lead to Win Cyber accelerator is the most recent addition to the ecosystem that will bring in a new pool of security solutions.
source software. Mr. Bailetti says the idea is to have a “cluster of technology ventures” that work together and complement each other. Securify Labs, for example, has partnered with another startup called TwoDucks Inc. to codevelop a new software security solution. Over at Carleton, a theoretical and educational component underscores VENUS’s business development efforts. There’s the VENUS Institute, a think-tank that looks to refine the definition of cybersecurity and Canada’s role in the sector, and several master’s level cybersecurity courses, two now in session and four more to come. VENUS will also be part of the Bayview Yards facility due to open by mid-2016, says Mr. Tracey. There, the organization plans to work with Communications Security Establishment Canada to establish a global resource centre that will lead a coalition of about 35 countries in cybersecurity monitoring efforts. “This is a global problem,” says Mr. Tracey. “It doesn’t really matter whether it’s Canada or Timbuktu. So we’re suddenly finding that we’re reaching out globally faster than expected.” When it comes to fixing that problem, there’s a “major disconnect between the old talent and the new talent,” Mr. Bailetti says. The young businesspeople he teaches and mentors don’t like the scare tactics of the traditional cybersecurity approach, he says. Instead, they seek to make the Internet more productive and creative, and to do so without having to trade in privacy to get security. “And you know what?” he says. “The kids are right.”
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Carleton University professor and business guru Tony Bailetti came up with the idea for a holistic cybersecurity ecosystem that would in part “beef up the cybersecurity startup in Canada” in an academic paper he published in the summer of 2013, a year after an auditor’s report noted the federal government’s “limited progress” in addressing cyber threats over the last decade. Within only a few months, Mr. Bailetti’s vision took shape with the VENUS Cybersecurity Corporation. Over the last year, the non-profit business centre has been quickly establishing a presence with the addition of six initial startups, master’s level courses in cybersecurity, a brand new accelerator program, and initiatives to solidify Canada’s cybersecurity sector and turn it into an international hub for future growth. “Right now we (Canada) have been pretty passive players. We just take whatever we get and that’s it. And I’d like to change that,” says Mr. Bailetti. “The idea was that we would do something that no organization
Launched this March, the program will grant mentorship and seed funding to startups deemed capable of growing to $1 million in revenues in three years, just like Mr. Bailetti’s original Lead to Win program. Mr. Tracey says they expect to take on up to a dozen new companies per year and to eventually expand to seven accelerators across Canada. VENUS has also been developing relationships with other cybersecurity accelerators around the world in order to form a global network. Mr. Tracey says it could offer a soft landing for outside companies to expand into Canada, and vice versa. Meanwhile, the six inaugural VENUS startups have been developing their technology at the organization’s Orleans facility for months. Managers of those startups say VENUS has helped them grow their business from within a central hub of resources and connections. Sem Ponnambalam, chief operating officer of Xahive, says her company has been expanding its scope at a rate that wouldn’t have been possible without it. The nineperson startup, incorporated in October 2013, develops a secure communication platform for sensitive data that namely targets clients such as health networks and legal offices. “I think it would take us a lot longer (to grow), for sure, and in terms of going global, I don’t think that would be happening anytime soon,” says Ms. Ponnambalam. “Definitely being in the centre of an accelerator that’s focused on security gave us a lot of exposure,” says Sherif Koussa, CEO of Securify Labs, a year-old, three-person startup that develops security for open-
HOW I GOT HERE: PAUL LOUCKS OF HALOGEN BY ALEXIA NAIDOO
It’s less of a huge jump than people might think. There was a pretty good safety net there because we had highly desirable skills that were in high demand. So what’s the worst case scenario here? You go out there and it doesn’t work out, you just go back to a normal job. At least you had a try at a business.
In 1997 you sold the company to Compaq, so where did you go from there?
I was a good student, but there’s a backdrop if you want to understand me. It goes back to the early days. Before I was 15 years old I’d already picked strawberries for five summers and I had a paper route for six years. I started working at the Ponderosa as a cook at the age of 14. There was a hard work ethic that started very early and was embedded in the culture of our family. I’m incredibly lucky as a person, but I think hard work makes you a little luckier.
I worked for Compaq for a year, but I didn’t fit the culture – I was used to being the boss. I went and worked on the east coast for a software company in Moncton, NB. After nine months there, my wife felt her heart was back in Ontario, so we returned in late 1999. I joined Halogen in early 2000.
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I worked at the University of PEI as a programmer/analyst, so I did exactly what you would expect coming out
Lotus Notes technology. I came to the realization that summer that this wasn’t going to be our vein of gold. So I put together a business plan to reinvent the company and we decided we wanted to develop a product that looked at employee appraisals. We launched in fall of 2002 it’s been a rocket ship since then beyond expectations.
Have there been any secrets to that success?
Was it a huge leap to start your own gig with NeoDyne?
What were you like as a kid? Were you always a techie and were you a good student?
You got a Bachelor of Computer Science from the Technical University of Nova Scotia – and you did it with distinction. What was your first job when you 10 graduated? TECHOPIA.CA
of university. I did that for two years and then decided to move to Ottawa to work for a company here for a couple of years. In 1990, I created my own business with two buddies, a consulting company called NeoDyne. We ran that for seven years, growing it from 3 people to 50 people. We were one of the fastest growing companies in Canada and were profiled in the Globe and Mail’s Report on Business.
You’ve been with Halogen for a while. It’s changed course tremendously and done very well. Walk us through that. When I came in to Halogen, it was a division of Manta Corporation. And it wasn’t until 2001 that we spun it out onto its own. It was a very small company with about 20 employees and we had a product that was Webbased survey software based on
Don’t adhere to all the rules people think will make a successful business. You can beat conventional thinking and create something completely different.
There was a hard work ethic that started very early and was embedded in the culture of our family. I’m incredibly lucky as a person, but I think hard work makes you a little luckier.
You’ve done very well and your company has done well. Where to from here? I always look five, 10, and 15 years out. We’re still in the early innings here. We have a very good company but we think we could build it into an exceptional company.
Could you see yourself retiring one day and heading out to the golf course? Oh, God, no. Don’t make me do that. I’m not the retiring type. I think things will always evolve. The role of CEO keeps evolving and what’s important is that I keep evolving in the role that I love.
Any advice that you would give to someone starting out? It largely comes down to hard work and a positive attitude. You have to be cut out for the ups and downs. I’m a dreamer. I’m a positive thinker. I think things are going to work out. If that’s the kind of person you are then I say go for it. Be a bit of a dreamer. And don’t let other people discourage you.
Changing
company has tripled in size since then. Mr. Fisher said expansion is “continual,” adding Gigataur is looking at adding other satellite offices, like the one it already has in China, so it can access other critical markets in the mobile world. The Star Wars project is not ANDREW FISHER a one-shot deal. Mr. Tam said CEO, GIGATAUR he expects Gigataur will update and people go out of their way to content in the game over the next find them,” he said. year or two. Mr. Tam said the company The Disney partnership will decided on the name Glitchsoft also open doors to more new in 2009 because it was edgy and opportunities to go along with BY TOM PECHLOFF fire with their level,” Mr. Fisher contrary to the mainstream. other projects already underway, t’s a time of great change for said. “We’ve been able to do that “But now we’re working with Mr. Tam and Mr. Fisher said. the Ottawa gaming company as part of our scaling. A lot of that a lot of triple-A brand partners, “Those are things that we’re formerly known as Glitchsoft. came through extremely long including Lucasfilm and Marvel, tempering because we have The company has a new name, hours of the team here getting and again just getting to the to manage our capacity and Gigataur, and a new game, “Star familiarity with their processes, table with these clients requires burnout because there have Wars Rebels: Recon Missions,” honing our skill set...We are a name that resonates with been a lot of hard hours to get which Disney launched March now operating at that level, these companies a little bit us to this date, but we do, we 26. fully functional there, capable more,” he said. Even though have a whole bunch of (other Gigataur’s CEO, Andrew of producing at that level for the Glitchsoft name is gone, the opportunities) and we’re starting Fisher, said it was a testament literally anyone.” edge can remain as the company to figure out which ones we want to his team that the company Now that the company and its continues pushing boundaries, to prioritize as a team and we will has advanced to the point it 30 staff have grown to this level, he added. continue to execute on those,” can partner with “the biggest Mr. Fisher and chief creative Gigataur was a name that Mr. Fisher said. entertainment brand.” officer Wes Tam both said a name resonated with all the founders, “We really have to choose the “As the CEO, I’d love to say I change was necessary to reflect Mr. Fisher said. right one for us. It’s a little hard had a huge part in this. I rubbed that. “It had the roots of the when you just come off working some shoulders, I bought some Mr. Fisher said Glitchsoft meanings of the words that we on your dream project … to lunches. It really was the team was a great independent studio liked in terms of they were both choose what’s the next ‘passion’ that made this happen,” he said. name, but the word “glitch” can creative and powerful,” he said, one we want to go after,” he said. “When you work with have a negative connotation. adding gigataur.com was also “We are chasing some of those. someone like Disney and Lucas “That wasn’t how we were available. At the same time, there’s ones … they don’t just work with small portraying it. Glitches in games Work on the Star Wars project that we think might be more studios. You have to be able to are actually quite fun things began 18 months ago, and the strategic.”
THE GAME
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Lorraine Mastersmith, Partner Robert Kinghan, Partner, Head of the Business Law Group
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