The Canadian government could certainly do more to help fund innovation and help startups get off the ground. That was the general consensus during a panel discussion at the Canadian Innovation Exchange forum Tuesday.
“I think there is a role for government to play, providing it is complementary to other players,” said Jennifer Brooy, vice-president of equity at Export Development Canada, an agency that funds Canadian exporters to enter global markets and focuses primarily on tech startups and small-to-medium sized businesses.
Brooy said while the government should do more to support entrepreneurs, it must also find an appropriate position in the broader ecosystem of investors.
There are many successful venture capital models around the world worthy of note from which Canada can draw successful repeatable components, said Brooy. With an already great go-to-market potential, she said, Canada should tailor a venture capital model specific to this country’s needs.
“We need to step back as a country and say, ‘Where do we have clusters and where do we have strengths?’ … and be a bit more strategic in what we’re doing,” said Brooy.
The need for a venture capital model that is relevant to Canada today is vital considering the traditional approach to funding was based on a U.S. model that no longer makes sense in a world that has since dramatically changed, said Brooy.
Moreover, the Canadian government has the capacity to understand and share its repertoire of intelligence about entrepreneurs and venture capital and help startups hook up with the right partners, said Brooy.
Another panelist agreed, saying the government can and should build the foundation of community networks and capital that will form part of a greater venture capital model that works for Canadian businesses.
“They have to lay the fertile ground and facilitate,” said Barry Gekiere, managing director of MaRS Investment Accelerator Fund, which participates in early-stage funding particularly in the area of IT communications.
Canadian Innovation Exchange forum was held at the MaRS Centre and drew entrepreneurs, investors, corporations, service providers and government.
Joining in the conversation, one audience member voiced concern that Canada’s lack of a robust venture capital community has inevitably resulted in entrepreneurs and their talent not getting identified. “Canada will catch up, but it’s going to need some huge government intervention to facilitate that,” said the audience member.
Brooy agreed that no venture capital model is sustainable without government support, especially given the global, real-time world we live in. “It’s scary,” she said.
Recently, in China, she observed innovation incubators “busting at the seams” with young people coming up with fresh ideas. Yet nothing of the sort exists to the same degree in Canada.
“If that’s our competition, look out,” said Brooy.
But as much as government intervention is important, it cannot just be about granting “trainer wheels.” Instead, Brooy said, “It has to be you keep the passion and at the same time, you pull it forward.”
Follow Kathleen Lau on Twitter: @KathleenLau