Looking outside my hotel room window in Calgary last week, I could see rows of barren office floors lit up at night. According to the commercial real estate firm CBRE, more than one in every four offices is vacant in the city. That’s more than the total office space available in downtown Winnipeg.

So what now for Canada’s fourth-largest city, which still contributes more GDP per capita than any other municipality in the country?

What gets lost in heated rhetoric over equalization payments, carbon-pricing and pipelines is that Alberta is quietly transforming its economy.

Last week in Calgary, there was unanimous agreement among the city officials, business executives, entrepreneurs and venture capitalists with whom I spoke that those oil jobs are never coming back—even if oil prices double.

The resource sector has been forced to innovate because of low energy prices and the increasing number of investors moving to divest or minimize their fossil-fuel exposure. As a result, Suncor is now considered one of the most sustainable energy companies in the world. The reduction in its carbon footprint and technological innovation are improving its bottom line: last quarter, Suncor recorded its highest profit margin in eight years.

But an innovation economy needs to be about more than resource extraction. And while the progress there will continue, the oil barons used to searching for a needle of bitumen in a haystack aren’t yet comfortable with the risk of investing in a mobile app.

Despite the number of startups in Calgary growing over the past decade, Alberta isn’t receiving as much venture capital funding as Ontario, Quebec or British Columbia. According to a University of Toronto Impact Centre study from 2018, Alberta is 50 to 75 per cent below the national averages for funded companies. Just $44 per capita is invested in Alberta’s digital economy compared to $200 per head in Quebec, according to Platform Calgary, which encourages Calgary’s innovation ecosystem in part by turning a parking lot into an innovation hub.

Brad Zumwalt wants to change that. A longtime Calgary tech entrepreneur, Zumwalt’s companies have been acquired by giants like Adobe and Getty, and he’s also an investor in Platform Calgary. He argues that $1 billion in funding from the province focused on tech investments and programming in education, government and industry can kickstart Calgary’s startup scene to the tune of 1,000 new companies, which would add 50,000 jobs and $10 billion in annual revenue to the provincial coffers by 2031.

But it’s not just the province that needs to step up. In Calgary, I saw visible frustration that the province was all but shut out of the federal billion-dollar superclusters pool. That frustration was relieved somewhat by the $100 million awarded to the Clean Resource Innovation Network in the recent federal budget. But my hosts argued there’s more that can be done to stimulate company growth through federal funding.

Some of that additional funding may be on the way. This week, a spokesperson for the Business Development Bank of Canada (BDC) told me that the bank will be launching a new direct fund focused on key industrial sectors “in the coming weeks” that will have a direct impact in Western Canada. While BDC wouldn’t disclose the dollar amount of the fund, they told me, “It will definitely be ‘at scale’ with other funds,” which would ballpark it between $150 million to $300 million, based on BDC’s existing venture capital fund portfolio.

And then there’s the issue of talent.

Alberta has always attracted the best engineers to work in the oil fields. What is less appreciated, including by the oil companies themselves, are the pools of talent sitting in their very own software and data departments who were too often viewed as IT support functions, versus strategic assets that deserve investment.

In some areas of tech, however, Alberta is out in front. Women’s participation in the sector has seen impressive growth, with the percentage of women tech founders reaching 30 per cent in 2018—a 50 per cent increase over 2016—and well above the national average of 13 per cent.

 Out of the depths of the oil crash, Calgary could become Canada’s next Waterloo. It is a petri dish of innovation with the culture, capital and talent needed to thrive in the new economy. And, it’s already working—in February, Morgan Stanley said it would pay $1.1 billion to take Solium Capital, which makes software for managing employee stock-option plans, off the Toronto Stock Exchange.

But it also needs to take more bets, let go of the past and harness the scrappy energy that made it the longtime and often underappreciated lifeblood of the Canadian economy.

Tech won’t fill the energy job gap on its own—oilsands workers aren’t all going to become coders. But the sector creates spinoff employment, and it is at least a place to start rebuilding Alberta’s economy for the future.

When Premier Jason Kenney says his province is open for business, does he mean “make Alberta great again” or “build a new Albertan economy?”

The big question for the province is whether its residents can stomach the risks needed to transform their economy, and whether politicians will demonstrate the leadership needed to frame those difficult choices in an honest way.

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