By Francis Moran
Regular readers of this blog will know that I spend a fair bit of time in the Waterloo region where both the buzz and the substance of the startup scene seem to get louder and more solid every day. (And before folks in Ottawa think I’m ignoring my hometown, let me acknowledge the high-energy, very high-volume event at The Hub last night where the Capital Angel Network brought together an extraordinary collection of entrepreneurs, angel investors and an encouraging cross-section of the local ecosystem. I left quite hoarse from all the fantastic conversations I had, many of which revolved around great things happening on the Ottawa scene.)
I spent much of last week in Kitchener-Waterloo, however, and, as always, came away with a bunch of favourable impressions.
Communitech launches new incubator program
The big announcement at Communitech’s Technology Leadership Conference last Tuesday was a sneak peek at the economic development organisation’s new incubator program, the full details of which were released earlier this week. Called HYPERDRIVE, the program offers $55,000 in cash to each of the 90 companies it will enrol in 10-company cohorts for a three-month “sprint to demo day” over the next three years. Graduates get a further $150,000 in convertible debt and an ongoing 24-month program of support that includes “a brief stint” in Manhattan.
There are now tonnes of incubator and accelerator programs from which entrepreneurs can choose. I like HYPERDRIVE’s richer-than-usual up-front investment — most such programs pay out no more than $15,000 or $20,000, a sum that barely covers living expenses during the typical three-month program duration. Even better, it is becoming quite clear that companies exiting such programs need a further immediate injection of cash, with many unable to wait for the post-demo-day dance with venture investors to wind its lengthy way to an eventual investment. So the $150,000 is an attractive add-on component of HYPERDRIVE, as is the Manhattan stint if it gives the companies meaningful exposure to the investment and supply-chain ecosystems there.
(I don’t think I’m colouring outside the lines here when I report that Invest Ottawa’s Bruce Lazenby told me last night that some equally good investment-related news will soon be announced here in Ottawa. UPDATE: In a lunch-time speech to the Building Owners and Managers Association yesterday, Lazenby previewed the $35-million fund he is hoping to bring to Ottawa.)
While on the topic of the leadership conference, I thoroughly enjoyed its three keynote speakers, two of whom exceeded my slightly jaded expectations of what I was going to hear.
I have long been a believer in the spiritual health benefits of what was once quaintly known as counting your blessings. However, the cynic in me was prepared to be underwhelmed by what I thought might be little more than a bunch of pollyanna tritenesses from author and blogger Neil Pasricha, whose 1,000 Awesome Things blog and subsequent books have exploded from an exercise in personal spiritual recovery to a global phenomenon. (Coincidentally, the final post in Pasricha’s more-than-four-year commitment to a five-posts-a-week blogging schedule was revealed in Toronto last night and is on his blog today.) Pasricha, who coyly ignores his Harvard education and demurs that he “works at Walmart,” electrified the crowd with his honest vulnerability and impressed me with how he has drilled through the small joys of his web project to examine the sociological merits of finding happiness in the mundane but still meaningful small moments of our lives.
Publishing sensation Arianna Huffington also exceeded my expectations, although in a much different way. Here was a woman I expected to be inspirational, but patrician and remote. Dunno why I though so; I just did. But she won over the crowd from her opening admission that she owns “not one, not two, not three, but four Blackberrys.” In a home-town arena of the beleaguered Canadian technology company, her commitment to single-handedly underwrite RIM’s survival was very well received. Huffington was unexpectedly both funny and self-deprecating, and I especially welcomed her deliberate sidebar to women entrepreneurs in the room, something I don’t witness often enough in this male-dominated sector of ours.
The third speaker was Nora Young, host of CBC Radio’s “Spark,” and if she failed to exceed my expectations it was only because I had pretty high hopes for her in the first place. I am a regular listener to Young’s weekly roundup of technology topics and trends and it was great to hear a long-form version at the conference.
We built out our Waterloo presence
My trip was a productive one for this blog and for the consulting firm that brings it to you. I recruited two new contributors to our blog, one of whom is also joining Francis Moran and Associates as an associate. I will properly introduce both as they begin their contributions here. Watch this space.
What about RIM?
I can’t tell Ottawans that I’m headed down to Waterloo without them asking me what the possible demise of RIM might auger for the broader technology community there. With the fallout still being felt from the unforgivable mismanagement and incomprehensible dismantling of Ottawa’s own technology powerhouse, Nortel, most here in the 613 assume that any similar fate for RIM will have a similar impact in the 519.
I simply don’t see the parallel.
Lost on most is the reality that RIM did not make Waterloo; Waterloo made RIM. And the forces that assisted RIM in becoming a global technology leader will persist and be available to all other local technology ventures no matter what happens to this one. Indeed, while I wish for nothing more than that RIM find its way back to thriving glory, its departure — either through outright failure or a breakup and offshore sale of its component pieces — could well be beneficial for the broader community. Smart, experienced executives who have built and operated global business units within RIM are already starting to exit the company to start or helm young ventures. I wouldn’t say it’s yet a rats-and-sinking-ship phenomenon; more a case of seasoned executives looking for the greater freedom and opportunity that a new venture offers. Any further decline in RIM’s fortunes, however, will only accelerate this process, which won’t be a bad thing for the rest of the ecosystem in Waterloo, to say nothing of the freeing up of scarce resources like talent and space that would follow in the wake of any significant shrinkage at RIM.
Simply put, there is far too much momentum in Waterloo, momentum that is utterly unconnected in any to the rise or fall of RIM’s fortunes. Any death of RIM will be mourned as the sad day it would be; the momentum will only gain strength.
Finally, how about that Pebble watch!
I went to another fabulous event last week, Tuesday night’s MoBeers, and ran into VidYard CEO Michael Litt. I asked Litt about his pal Eric Migicovksy, who I first met when he was a student at the University of Waterloo’s Velocity incubator. I’ve watched with interest ever since as Migicovsky brought his novel Blackberry-connected watch inPulse to market. (Migicovky and Litt both operated their young companies out of a house Litt owned on Batavia Place in Waterloo. Both got accepted into the elite Silicon Valley incubator, Y-Combinator, a nice story we were happy, on a pro bono basis, to pitch to the National Post.) As we chatted about Migicovsky, neither Litt nor I had any inkling that he was about to become the global startup story of the week.
A couple of days after our conversation, Migicovsky launched a campaign on the crowd-sourced fundraising site Kickstarter. He was hoping to raise $100,000 to fund his new product, the Pebble smart watch that connects an e-paper display to iOS and Android devices using a Bluetooth connection. In less than 28 hours, he had raised more than $1-million, a sum that within five days rose to more than $3.5-million, the most ever raised via Kickstarter. As of this morning, the total is a mind-blowing $5-million raised from nearly 35,000 backers. Phenomenal work, Eric; now all you have to do is build a few hundred thousand watches!