Canada

The Week in Startup Land (Edition #2)

By Mark Evans in Startups No Comments Tags: , ,

After kicking off my weekly look at the Canadian startup landscape last week, here’s edition #2. It features highlights of the Canadian landscape, as well as some other interesting startup-related information and content. Leave a comment if there’s something interesting I should add.

1. Extreme Startups (a rebranded and recapitalized version of ExtremeU) kicked off with $7-million in financing, including a big chunk from BDC, which will be handing out $150,000 in convertible debt financing.

2. Of the posts on MET this week, “You’ve Raised Venture Capital; Now What”, got a lot of attention.

3. Burn Rate vs. Runway - Mark MacLeod (aka Startup CFO) takes a look at the balancing act between spending money and managing it to last awhile.

4. Scars: Jason Cohen has a nice post on how entrepreneurs can succeed by getting advice from other battle-scarred people.

5. Signs You’re Not Building a Minimal Viable Product: With all the talk about lean startups and MVP, Anthony Panazzo offers some good insight into the definition of an MVP and what it involves.

6. Talent for Tech: Recruiting the Right People: A nice talent/recruiting blog package from MaRS on the different aspects of attracting and hiring tech talent.

7. What’s Your Personality Type – Insights for Lean Ventures: Flow Venture’s Ray Luk looks at how the top five personality archetypes fit into the lean startup world.

8. In my Globe & Mail “Start” column, I put the spotlight on Startup Edmonton‘s impending move into a new facility, and the launch of a $450,000 accelerator.

Bonus: We Love Lean has a great post putting the spotlight on 15 tools that “every lean startup can’t live without”. In particular, my attention was caught by Lean Canvas.

Extreme Startups Unveils Accelerator with $7M in Financing

By Mark Evans in Social Media 3 Comments Tags: , , ,

As much as Canada’s startup landscape has been seeing more financings (Clio being the latest deal announced), there’s still a long way to go before we have a healthy and robust capital ecosystem.

So it’s good to see the arrival of a new accelerator, Extreme Startups, which is launching with $7-million in funding from Extreme Venture Partners, OMERS Ventures, Rho Canada Ventures, BlackBerry Partners Fund and BDC.

Extreme Startups will have two cohorts of five companies/year. Each company in a 12-week cohort will receive $50,000 (in exchange for a 10% equity stake) and be eligible to receive up to $150,000 in a convertible note from BDC upon graduation.

“There is a great environment with a lot of talent and voracious entrepreneurs, so it’s a great space to be,” Andy Yang, chief innovation hunter with Extreme Startups, said in an interview.

Extreme University Rebranded

Extreme Startups is a rebranded and expanded version of the Extreme University accelerator program started by Extreme Venture Partners. In addition to having access to 29 mentors, the initial cohort will also have Dan Debow, who recently sold Rypple to Salesforce.com, as the “Entrepreneur Link”.

Yang described Extreme Startups’ investment approach as “agnostic”. The focus, he said, will be on entrepreneurs who are the “best and brightest…and have potential for leadership and great products”.

“I would say we’re looking for entrepreneurs and teams attacking large markets with disruptive technology and products,” Yang said.

Another key part of the program will be relationships and access to “leading technology companies and industry pillars”, which will be unveiled soon after negotiations are completed.

Applications open today and close March 1, 2012 for the spring 2012 cohort, which starts on March 15, 2012. Teams can apply at http://extremestartups.com

Is Canada’s Startup Landscape That Robust?

By Mark Evans in Startups No Comments Tags: , , , ,

At a conference earlier this week put on by the Ontario Media Development Corp., I kicked off panel I was moderating by boldly declaring the Canadian startup landscape is as exciting and healthy as it has ever been during the 15 years I’ve spent as a reporter, entrepreneur and startup consultant.

But before I could ask a question, one of the panelists, Real Ventures’ J.S. Cournoyer, stepped into the fray by suggesting the landscape wasn’t as bullish as my description. His key point, which is totally on the mark, is there still isn’t enough capital to properly support and nurture startups. Instead, there are small pockets of activity that are celebrated but are relatively modest in the scheme of things.

It got me thinking about whether my enthusiasm is well-intentioned but a bit misplaced. As I thought it through, it struck me there are three parts to Canada’s startup ecosystem.

On one hand, there are investors, who are slowly but surely becoming more active. Players such as Real Ventures, Extreme Ventures, iNovia, Mantella Ventures, Golden Ventures and OMERS are making some interesting investments. Nevertheless, it’s a relative drop in the bucket to what’s needed for the Canadian startup ecosystem to really thrive.

We’ve also got a growing number of incubators and accelerators – players such as Founder Fuel, Extreme Labs, GrowLab, Next36, MaRS Commons and Incubes. Even so, it’s a modest amount. Note: I’m not totally convinced about the incubator model given the “cost” to play and their marketing pitch that every “graduate” will able to pitch to investors.

Then, there are the entrepreneurs themselves, who the most exciting and active part of the ecosystem. With the barriers to entry to lower than ever and entrepreneurialism becoming hip, startups and here, there and everywhere. In fact, I’m starting to think it’s too frothy given some of the startups I’ve seen recently.

When you look at the three “buckets”, there are different stages and healthiness. So to make a sweeping statement about the startup landscape without breaking things out is a mistake.

It is difficult to tell how startup scene will evolve over the next couple of years. Maybe we’ll see more capital for the startups seeking seed and growth capital. Maybe accelerators and incubators will, in fact, create high-quality opportunities and businesses. And maybe we’ll continue to see a robust entrepreneur landscape, as well as a healthy amount of roadkill given not everyone can be successful.

If I’m guilty of anything, it’s being a glass half-full person. While things aren’t perfect, I do see lots of reasons for encouragement.

What do you think? Are we guilty of being too bullish?

HootSuite’s Ryan Holmes Has Big (Un-Canadian) Dreams

By Mark Evans in Startups 3 Comments Tags: , , ,

For whatever reason, the vast majority of Canadian high-tech entrepreneurs never shoot for the big deal. Rather than aiming to be bought by $100 million, $500-million or, heck, even $1-billion, the typical scenario is they get an offer worth from $25 million to $50 million.

It’s like the contestants on the game show, “Let’s Make a Deal”, who take what’s in the box rather than risk seeing what’s behind curtain #1.

It the safe, conservative Canadian play but in the process, they leave lots of money on the table, as well as the potential to build something global, large and built to last. It leaves Canada with a scrappy bunch of small to medium size companies but not enough heavyweights such as Research in Motion and Open Text.

Given this take-the-money-and-run scenario, it’s good to seee HootSuite CEO Ryan Holmes tells Techvibes he has grander ambitions. In an interview, he said:

“I want to build a billion-dollar company and take it to an IPO exit, enable the financial independence of 50 people around me and build something disruptive, like how Netflix disrupted the traditional movie rental industry or how Apple rewrote music.”

Baby Thrives in the Arms of a New Owner

It may be a bold statement but it is the type of chutzpah Canadian entrepreneurs need as opposed to getting excited about the first interesting offer than comes along. Sure, there is risk in turning down lucrative takeover offers but there’s also risk in accepting a deal, only to watch your “baby” thrive in the arms of the new owner.

One of the major hurdles facing Canadian entrepreneurs who do have ambitions to go big is financing. There just isn’t enough post-seed capital to properly finance a company with high-growth plans. This is changing as U.S. investors start to become more serious about Canadian start-ups but it has meant that many entrepreneurs have taken a deal because raising capital was so hard to do.

Who knows if HootSuite will reach Holmes’ goals but I give him complete credit for going for it. HootSuite is a rocket and, arguably, one of Canada’s hottest startups. In some respects, it would be shame to see it disappear in the bosom of a buyer before it had a chance to see how run and fast it could run.

Who Will Be Canada’s Hot Startups in 2012?

By Mark Evans in Startups 5 Comments Tags: , ,

The flurry of high-tech deals last year saw a bunch of promising startups snapped up – Zite, Rypple, PostRank, PushLife, Tungle and Five Mobile to name a few.

The encouraging part of the Canadian landscape is the growing number of high-quality startups being created and, thankfully, funded. It means that rather than having M&A activity “hollow” things out, there are more startups ready to step into the spotlight.

So, who are the Canadian startups that warrant our attention in 2012? (Note: I’ve updated the list, and will continue to do so)

Who’s going to grow in a major way, attract a significant number of users and customers, launch exciting initiatives, or be acquired. Granted, it’s a subjective list but it is an interesting way to speculate on companies that will capture the spotlight this year. If you leave a comment, I’ll update the list.

To get the ball rolling, here are some of my choices for the “Hot Startup” list:

- ScribbleLive, the world’s leading real-time content creation and publishing company whose clients include Reuters, AP and FA.
- WineAlign, which cracked the 100,000 unique visitor mark for the first time in December
- 500px, one of the leading places to display and share beautiful photography
- Pressly, whose technology is helping publishers create mobile Web sites that embrace the “swipe and read” functionality of apps
- QuickMobile, one of the leading event and conference mobile application developers
- Atomic Reach, which makes it easier for brand to discover, publish and market content
- Wave Accounting, which recently raised $5-million to drive growth of its free online accounting service
- Keek, which offers a video-based social network
- Fixmo, a mobile security company that recently raised $23-million
- TribeHR, which develops human resources service for small and medium businesses
- GoInstant, which is creating technology that lets people co-browse a Web site at the same time.
- Vidyard, which has created online video platform for business
- Unbounce, which makes it easy to create customized landing pages.
- Plastic Mobile, a fast-growing mobile agency that specializes in UX and design.

Note: ScribbleLive and Atomic Reach are digital marketing clients of my company, ME Consulting.

Five Reasons to be Bullish About Canadian Startups

By Mark Evans in Startups 2 Comments Tags: , ,

As we head into 2012, there’s been a lot of back-slapping and congratulatory talk about the number of Canadian startups and more mature technology companies purchased this year – a back of the napkin calculation pegs it as more than $2-billion.

While deals are exciting, I think there are other, more significant reasons to be bullish about the Canadian startup landscape. My list includes the following:

1. There are more startups being established as businesses as opposed to projects. They’re being created by entrepreneurs who have a pretty good idea about how they will make money by selling products that meeet a need. This stands in contrast to startups that are more projects and/or features than businesses. To me, it signals the growing maturity of the startup community and a recognition that just because it’s less expensive to do a startup, it doesn’t mean there should be any less focus on building a business.

2. The infusion of more seed capital from a growing number of players has filled a huge void in the marketplace. In the process, it has allowed entrepreneurs to capitalize on strong ideas as opposed to watch them stay unrealized due to a lack of capital. The only way Canada is going to build a vibrant and robust high-tech community is making sure entrepreneurs can develop, grow and take risks so they can have a good shot at being successful.

3. The emergence of more serial entrepreneurs who have jumped back into the fray after being successful. This includes people such as Dan Debow, Mark Ruddock and Marcel Lebrun, who bring experience, skills, personal capital and a powerful network into a new opportunity.

4. More walk as opposed to talk. It wasn’t that long ago that there high-tech events were teeming with wanna-be entrepreneurs who would leave their corporate jobs if they could only get some seed capital, or if there would other people who wanted to join them, or if starting a business wasn’t as expensive. Today, there’s a new wave of entrepreneurs happily willing to take a shot, including younger people who may not have a lot of experience but are loaded to confidence and enthusiasm.

5. The maturation and growth of the startup community. When David Crow started DemoCamp, it, in many ways, was flying solo. Today, there’s a fast-growing community that has shown a willingness to support each other. This includes organizations such as MaRS, the growing number of incubators, and many people who share their time and energy with other entrepreneurs.

While the startup community must continue to evolve and there’s still a need for more growth capital, there are plenty of reasons to be bullish about the landscape and the ecosystem. There was great progress made in 2011 that, hopefully, will be used as a foundation for even better things in 2012.

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