VANCOUVER — B.C.’s new minister in charge of innovation, Ravi Kahlon, has been in the job for less than two weeks, but he has already seen evidence of the “unique challenges” the province’s tech ecosystem faces when it comes to federal funding.
It’s a problem the BC Tech Association confronted last week when it cleared out of the rented Vancouver space where it housed local startups in its Innovation Hub. It has become a digital-only support service for the region’s tech community after it could no longer afford to keep the Hub’s doors open.
In an interview with The Logic, Kahlon acknowledged the importance of finding consistent funding to support the province’s tech community, saying, “We need to think long term; it can’t be short term.”
And he says he’s already begun work on two other key initiatives: establishing a provincial venture capital fund and an intellectual property strategy.
B.C.’s new minister in charge of innovation, Ravi Kahlon, has seen the province’s “unique challenges” when it comes to the tech sector and federal funding, despite only being in the role for a couple weeks. The BC Tech Association couldn’t secure more funding for its Innovation Hub and had to shutter its last physical space. He said he understands the importance of consistent funding. Kahlon is also starting work on establishing a provincial venture capital fund and an intellectual property strategy.
One of the goals for Kahlon’s New Democrats, re-elected last month with a majority government, is ensuring “that we get our fair share of federal funding” for the province’s tech sector. He told The Logic he wants to see the same passion from Ottawa for investment in B.C. as in Ontario, for example. “So far, we’ve had great alignment between the federal and provincial governments on many things, and we certainly want to do that with this, as well.”
He said he understands the importance of long-term financial commitments. “The question for us is: how do we find more stable ways to fund initiatives like this? And it’s something we’re certainly considering.”
The Innovation Hub’s closure was not planned, Jill Tipping, the BC Tech Association’s CEO, told The Logic. “It was a closure in reaction to failing to secure continuous, go-forward federal government funding.”
The hub, located in East Vancouver, opened in 2014. It had since housed more than 80 startups and other companies, according to the association, and offered a space for networking, workshops and other events. First funded by the federal government through an accelerator and incubator program, since 2019, it had been funded by Western Economic Diversification Canada (WEDC), one of the federal government’s regional development agencies.
Tipping and the association attempted to find funding beyond that time, but she said WEDC told them there was no more money available for the hub and the association’s accelerator services. “There’s been a lot of demand on funding in B.C., and that means there’s no money for things like this,” Tipping said she was told as to why the projects were no longer a priority. “Without that, we had a real dilemma because we couldn’t afford it without that support.”
WEDC “was pleased to assist” the BC Tech Association with several programs in recent years, providing $2.25 million since 2018, spokesperson Amanda Costa wrote in an email to The Logic. She noted that “those projects are now complete,” and the association requested a shortened timeline for some programs, which did not impact funding amounts. The department “is currently focused on ensuring the liquidity of firms affected by the pandemic,” which includes $300,000 that the association will receive through Innovate BC to help tech companies navigate the economic climate.
Tipping draws a parallel between the shutdown of the Hub and that of the Cube, a centre for companies working on virtual-, augmented- and mixed-reality, which it shuttered in May 2019, less than two years after it opened to much fanfare. The association funded the Cube with money it accessed through federal funding through the Canadian Accelerator and Incubator Program. When it ended in March 2019, the organization said it “was unable to secure provincial or federal funding to enable the Cube to remain open.”
Tipping said, “It’s such a shame to see history repeating itself. “We come up with these great ideas, and we fund them, and we build some momentum in the ecosystem. But then it just seems that we really struggle here in B.C. to sustain that. And so we’re constantly in this experimentation mode—stopping and starting—and we know that’s not the way to deliver real economic benefit and real economic value. We know that we need to build over time on these things.”
The next long-term project on Tipping’s agenda now feels more pressing. The association is part of a group of 11 organizations, including Foresight and SFU VentureLabs, dubbed ScaleUp BC, that is asking federal departments, including WEDC, for funding to bring a version of Ontario’s Scale-Up program to the province. That would allow it to continue providing its accelerator programs, which it now lacks the funds to offer in the winter and spring, Tipping said.
Kahlon said he hadn’t yet had his introductory meeting with the association, but thought “any initiative that helps promote the opportunities for tech companies to grow, or talent to get opportunities, is a good thing.” He said he’s also looking forward to talking with the tech association, as well as provincial agency Innovate BC and other partners, about how to encourage the private sector to step up its funding, as well.
Kahlon’s mandate letter tasks him with developing “an intellectual property strategy to support more innovation and commercialization by B.C. companies.” Developing IP has become a focus for other jurisdictions, including Ontario, which commissioned a panel of IP and business experts led by former Research in Motion (now BlackBerry) co-CEO Jim Balsillie to study the issue. The group’s recommendations, published in February, included encouraging universities, colleges and accelerators to focus on turning the research they support into patents, as well as creating educational resources for entrepreneurs to help them patent their work. The province then put Balsillie’s group in charge of implementing those recommendations.
The B.C. NDP have promised to create a first patent program, which would give businesses in the province a rebate on some of the costs they incur in filing their first patent. Kahlon called the patent initiative a “signature piece” of the NDP platform. IP has also been a focus for the federal government; Wednesday will see the launch of the Canadian government-funded Innovation Asset Collective, a four-year, $30-million pilot project to help data-driven cleantech companies with intellectual property strategies, patent generation and litigation protection, among other things. “We want to find ways to align our financial supports with the federal government as much as possible,” Kahlon said. “There’s no point in recreating the wheel or doing something that’s parallel, but doing the same thing. It won’t serve anyone’s purpose.”
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Kahlon also said the lack of venture capital in the province is “a major issue.” The NDP government wants to put together a fund to support startups and anchor them in B.C. “That’s certainly one of the things I’ll be looking to advance in the near future,” he said, noting the government is working on getting people together to talk about what such a fund might look like.