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November 23, 2015 Vol. 19, NO. 2
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Sky-high potential A small Ottawa firm aims to revolutionize air traffic control and remake the way the world’s airports work. > PAGES 8-9
After 12 years at Tourism Kelowna, Catherine Frechette has returned to the place where she grew up to take on a new challenge. PHOTO BY MARK HOLLERON
Welcoming the world to her home Ottawa Tourism’s newest exec is determined to make capital a can’t-miss destination Catherine Frechette sits down with OBJ to talk about her newly created job and what it means for city’s tourism industry > PAGES 4-5
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Rebuilding Chinatown with China’s largess
How can Ottawa benefit from surging Chinese investment into Canada?
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hinese businesses are eager to invest overseas.Foreign direct investment into Canada from China doubled over the past five years, to $25.1 billion, according to Statistics Canada.
Beijing’s Qianmen Street
Public attention is often on the resource industry, but Chinese companies are investing big in real estate, too. Take Greenland Holding Group Co., which is busy in downtown Toronto with a project that includes a boutique hotel, two condo towers and a museum. The company isn’t only bullish on its prospects in Hogtown, but across the country. So what does Ottawa need to do to bring that kind of investment here, to reinvent its Chinatown? With China becoming Canada’s secondlargest inbound tourism market after the U.S., and new trade and investment agreements in place, it’s a question that has some urgency. Ottawa has a limited window of opportunity before that money lands somewhere else.
Crisis creates opportunity
For Grace Xin, Executive Director of the Somerset Street Chinatown Business Improvement Area, crisis creates opportunity.
MONDAY, NOVEMBER 23, 2015
Take, for example, the October fire in Chinatown that claimed four local businesses – the Middle East Bakery, Shiraz Food Market, the Daily Grind cafe and A Dark Cloud Tattoo Parlour.
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Whether these business owners chose to rebuild on site remains to be seen. But there are already four other lots left vacant in Chinatown. “Ottawa should do something to encourage businesses to rebuild,” Xin said. Call it starting clean with a blank canvas. That makes for endless possibilities.
Taking advantage of a blank canvas
But as we covered in the first article in this series, Ottawa’s Chinatown suffers from parking challenges, small lot sizes and building height restrictions that make it difficult for a developer to realize a worthwhile return on investment. In our first article, current councilor Catherine McKenney affirmed her commitment to help cut through the red tape with city staff to address these issues. It can be done when people work together. With the help of former ward councilor Diane Holmes, local businessman Kevin Yip and developer Phoenix Homes got city approval to proceed with a mixed-use nine-storey development at 770 Somerset. Easing height restrictions and dealing with parking would be great for Chinatown, but it also needs a vision that
will keep it true to itself. Xin doesn’t want the character of Chinatown to vanish among condo towers. Nor does it need more restaurants. Xin envisions an almost theme park approach, built by Chinese for all who are interested in Asian culture. Chinese investors and designers would team up with local talent and businesses to build a vibrant and fun commercial district with tourism value, and add to Ottawa’s appeal as a destination for visitors from all places. “As the nation’s capital, Ottawa is of particular interest to the Chinese,” Xin said. “Given our twinning relationship with Beijing, we should try to build more than just a Royal Arch! With Chinatown’s strategic downtown location, it has the potential to become an important tourism and economic engine like Beijing’s famous Qianmen Street, if the City has the vision and determination.”
The U.S. example
In areas of the U.S. suffering from the loss of manufacturing jobs, local governments are providing incentives to encourage redevelopment and attract residents back to depressed neighbourhoods. In Allentown, Penn. For example, a 52-hectare area of the city core has been designated a “neighbourhood improvement zone.” For a 30-year period, the majority of taxes collected from residents will be reinvested in the form of debt-financing for developers, and to ensure reasonable rents to attract young professionals to the area. This is just one example of what could be done, with a little imagination. “We need the City to say, yes, this community is suffering and we should turn it around with a theme that fits its unique cultural flavour and is authentic,” said Xin.
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TOURISM IS MORE THAN A VISIT TO PARLIAMENT HILL. PHOTO COURTESY OF OTTAWA TOURISM
Seeing past the tip of Ottawa’s tourism iceberg $1.79B in visitor spending means the roots of this industry run deep
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“A healthy tourism industry is much more than the sum of its hotels and signature attractions. It’s an ecosystem with roots in many other industries and subsectors.” “They want access to the convention market, or the tour group market, or some other sector of our local industry,” Van Kregten said. The connectedness of this eco-system in a major city became evident in Toronto during the SARS crisis in 2003. The usual suspects – hotels, restaurants, airlines and attractions – were the first to feel the impact of the quarantine. But within a few weeks, dry cleaners,
convenience stores, A/V companies and other businesses in the orbit of the tourism industry were suffering, too. CONSTANT REINVENTION And while it may play second fiddle to other sectors of the local economy, tourism has proven itself to be a stable anchor through the ups and downs of other industries. “It’s an industry that’s
fairly secure because it’s constantly reinventing itself,” Van Kregten said. That’s due in no small part to the efforts of entrepreneurs. Van Kregten cited the example of Indigenous Walks, founded by Jaime Koebel. This new twist on the guided walking tour interprets the city and its history from an Indigenous perspective. “So next time you are walking down your street, take a look around – odds are, you have a neighbour who makes their living thanks to Ottawa’s tourism industry,” she said. WANT TO GET INVOLVED WITH TOURISM IN OTTAWA? For more information please visit www.ottawatourism.ca or follow on Twitter, @Ottawa_Tourism.
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Communications at Ottawa Tourism. “Our tourism industry runs deep.” A healthy tourism industry is much more than the sum of its hotels and signature attractions. It’s an ecosystem with roots in many other industries and subsectors. Take a look at the Members page of the Ottawa Tourism website. You’ll find everything from photographers, postsecondary institutions, drone companies and commercial printers, to limo companies, bus line operators and airlines, not to mention the expected list of retailers and restaurants. These organizations are all part of Ottawa Tourism because they have a vested interest in the sector. It’s a source of opportunity and employment.
MONDAY, NOVEMBER 23, 2015
t’s no secret that tourism is Ottawa’s third-largest industry behind hightech and government. Visitor spending contributes over $1.79 billion a year to the local economy. But still, there are some folks out there who see tourism as a second tier asset for the city. They might even consider it frivolous in serious talks about economic prosperity and job creation. But that billion-dollar figure can’t be ignored. It’s a tally that includes much more than area hotels, meeting and event venues like The Shaw Centre and the EY Centre, and annual draws like the Canadian Tulip Festival. “These are just the tip of iceberg,” said Jantine Van Kregten, Director of
TOURISM Ottawa Tourism exec sees ‘new vitality’ in hometown After working in B.C.’s Okanagan Valley for more than a decade, Catherine Frechette returns to the city where she grew up to help visitors get the most out of their experience in the capital
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MONDAY, NOVEMBER 23, 2015
ong a tourism hotspot for Canadians during special occasions such as Canada Day and Winterlude, the nation’s capital is poised to become an even more popular destination over the next few years. Ottawa will be the focal point for the country’s 150th birthday celebrations in 2017, when it is expected to host a smorgasbord of high-profile events from the Juno Awards to the Grey Cup. Beyond that, infrastructure projects such as the LRT and the construction of new hotels are set to enhance the visitor experience in the National Capital Region even further. In short, it’s the perfect time for Catherine Frechette to come home. The 39-year-old, who grew up in Rockcliffe Park, became Ottawa Tourism’s first director of destination development in September, returning to the capital after spending 12 years as communications manager at Tourism Kelowna. During her time in the Okanagan, Ms. Frechette helped launch the acclaimed Farm to Table program showcasing Kelowna’s vibrant wine and restaurant scene and spearheaded the effort to convince the Amazing Race Canada to film its premiere episode in the city in 2013. Now, she returns to her roots to take on a new challenge. OBJ recently sat down with Ms. Frechette to talk about her new job, how her hometown has changed from her days as a student at Lisgar Collegiate and what she sees for the future of the tourism industry in Ottawa. The following is an abridged transcript of that conversation.
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OBJ: You’ve just started in a newly created position. What is the job of director of destination development all about? CF: It’s finding ways to strengthen the visitor experience and finding any potential gaps that are hindrances to the visitor experience, so that we can make the most seamless, remarkable visitor experience that we can in Ottawa. At the end of the day, we want people to love the time they had here and want to talk about it with their friends and relatives and want to come back. Destination development is a way that we can facilitate that by finding those areas that
need to be strengthened and work with partners in a really collaborative way to fill those gaps and bring opportunities to the fore. OBJ: You mentioned when you first took the position that one of your most important jobs would be talking to as many people in the local industry as possible and soaking up as much information as you could. To whom have you talked? CF: Tourism and business leaders in town – people who have spent a lot of time thinking about the visitor experience and thinking about our destination. The important thing that differentiates destination development is that a destination is not the organization that markets it. Ottawa Tourism is not the destination. Our destination is the National Capital Region. Initially, I sought out people who have lived and breathed tourism and were immersed in it and were willing to share with me their visions of what we can be as a destination and how we can get there. From that, I put together a list of areas that we can strengthen and now I’m working on an action plan. There’s still a lot of work to be done on that. OBJ: Did an overlying message or theme emerge from those discussions? CF: The overlying theme is that it’s a really exciting time to be doing this in Ottawa. In the short term, we are looking at a number of milestones that are going to have an impact on our visitor economy and visitors’ perception of Ottawa. 2017 is the biggie, of course. All eyes will be on Ottawa as the nation’s capital as Canada celebrates its 150th birthday. Leading up to that we have some big events, not necessarily tied to the 150th, but certainly big events. One Young World is going to be here; that’s a major global event. We’ve got new product coming online as far as the cruises on the canal, for example, with Ottawa Boat Cruise, which is fantastic. We would love to see some more animation around the canal, so that’s very exciting. There are new hotel properties coming online. Looking ahead to 2018, the LRT is coming into the picture, and that’s going to shape access to various points around Ottawa. Long-term, the developments that are happening at Zibi (Windmill’s
2017 is a great catalyst, but what kind of legacies can we leave in terms of a product offering that visitors can enjoy?
Catherine Frechette is returning to the place where she grew up. PHOTO BY MARK HOLLERON
$1.2-billion condo and retail project at Albert and Chaudière islands), the development proposals that are taking place for LeBreton Flats … it’s a very exciting time. OBJ: 2017 is just over a year away. There have been a few events announced and we expect a lot more to be made public in the coming months. What are your priorities in terms of laying the groundwork for making Canada’s birthday celebration as successful as possible? CF: The big opportunity with 2017 is we want everyone in this country to put a visit to the nation’s capital at the top of their list of travel. With the new vibrancy that we have in Ottawa – the dining scene, the beer trail, Savour Ottawa, the access to recreation that we have here – we want there to be things that ignite people, whether they are an adrenaline junkie, whether they are coming with their family, whether they are couples, whether they’re a foodie, the whole gamut of interests. High on my radar is how can we find those niche products that need to be supported or developed and how can we assist in bringing those to the fore. Sometimes it isn’t with funds. Sometimes it’s Ottawa Tourism’s linkages and relationships with groups like OTMPC (the Ontario Tourism Marketing Partnership Corp.), with Destination Canada, tourism associations across Canada. So that’s a big focus. But I think you also have to think beyond 2017. As other people in the industry have said to me, event hangover is a real thing.
OBJ: Obviously, the Shaw Centre puts a high priority on boosting convention traffic. Have you talked much about what role you could play in helping that process? CF: Ottawa Tourism is very connected with the Shaw Centre on the sales side of things. A large number of our staff are focused on bringing new conventions and new meetings business to Ottawa. There may be ways that destination development can support the sales work that they do. I don’t mean pounding on meeting planners’ doors, but maybe there are ways to make a delegate’s experience more positive. Maybe there are ways to connect the community to make them aware of conventions that are in town, so that when delegates jump into a taxicab, the driver is aware of that conference and says, ‘Welcome to town.’ A big part of people’s relationship to a destination is how welcome they feel within it. OBJ: You spent more than decade working in the Okanagan, which has done a very good job of changing its image over the past few years from “beaches and peaches” to a more sophisticated brand focused on wineries and other attractions. Do you have a vision of what Ottawa’s brand should be? CF: Brand and destination development work hand in hand. Brand is that initial spark. Maybe a consumer sees an ad that sparks their interest in a place. Ottawa’s brand is out there already. I think we sometimes have this mistaken vision that brand is something that we get to mould completely on our own from the ground up, as though it didn’t exist before we came into the picture. That’s just not the case. It’s people’s perceptions of a destination that they already have. But it’s awareness of other aspects of it that will change perceptions. For example, Las Vegas was very good at shifting its brand from purely gaming to encompassing entertainment. That was a really key shift. I think in Ottawa we have a very strong “capital” brand. We have a growing culinary component. We have a very strong culture brand. Our access to nature is also a strong pillar of
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the brand. I think those are the elements that are going to spark people’s interest in coming, especially if they know there’s a show in town they want to see or other ways to experience the city. They can rent a bike right here on the street and see a destination that way. There are museum exhibits in town. All of those things link into the brand. Once visitors are here, do those experiences live up to that brand? That’s what destination development is about. Brand might get people here in the first place, but the experience that they have will get them to talk about it and come back.
to be collaborating with people. That’s why I did the industry consultations. It’s not just one organization pushing one agenda.
OBJ: I know you’re still working on the action plan. But are there any elements you already see as priorities for it? CF: There are. There are a lot of moving pieces, including bringing the right partners to the table and working through these plans in a step-by-step process and being collaborative from the beginning. I don’t want to get into the nitty-gritty of the plan right now because it’s still being formulated and there’s still a lot of work to be done. I guess my best answer is there are milestones that are coming up that are going to be key
aspects to it. OBJ: During your time at Tourism Kelowna, you witnessed a lot of changes in the industry. Are there any lessons you learned there that you hope to implement here? CF: You were talking about the evolution of the “peaches and beaches” brand to a more sophisticated foodie, wine trailoriented, recreation-oriented brand. A lot of that has to do with destination development. I had a front-row seat for the development of wine trails, the farm-to-table experiences that are available there. I actually looked heavily toward Savour Ottawa when creating that particular program. There were definitely key takeaways that I learned and one of them is: don’t go it alone. It’s the old adage – if you want to go fast, go alone, but if you want to go long, you have to go together: getting the buy-in right at the industry level and working with the wineries right from the get-go, working with golf courses, working with the farms and the chefs on the farm-totable stuff. You get this tremendous sense of momentum and excitement around the development of a new product or experience when people have bought in at the grassroots level. My focus is going
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OBJ: Have you met with the mayor? CF: Definitely. He’s a huge booster and a real proponent of tourism. He has a strong vision for where tourism in Ottawa can go. OBJ: Have you had much of a chance to get a feel for how Ottawa has changed since you left? CF: As much as I can. There was a lot to be done on the work front when I got back, a lot to be done finding a home (laughs). I brought a horse (a quarter horse named Cody), so I had to make sure he was comfortable and found a home. But every free chance I got, I explored neighbourhoods. Ottawa’s neighbourhoods are really exciting now. The BIAs in town have something to be proud of. When I was growing up, I don’t know that there was quite as defined a character around the neighbourhoods as there is now. I’ve also been going to museums, I’ve been seeing shows, I’ve checked out Lansdowne. I’m just seeing this new vitality to Ottawa, this really neat vibe that maybe was in its infancy
when I left. The city has definitely changed in some very positive ways. Yet my old neighbourhood is still the same in so many ways. It’s comforting and exciting at the same time. OBJ: Speaking of Lansdowne, what opportunities for tourism does that project present? CF: It’s a signal that Ottawa is prepared to make real and effective change in tourism and that there are great opportunities still to be had. As established as Ottawa is, there are opportunities to revitalize the product. I don’t know that I’ve ever been anywhere that feels like Lansdowne. It’s its own entity, it has its own vibe. Also on the private front, look at the new hotels that are coming online in the next few years, look at what’s happening at Zibi, which is going to include some tourism elements down the road. The renovations at the Rideau Centre, the new Tanger outlets – we’re seeing some very significant investments that are major visitor experiences as well as being positive for locals. Again, it’s a signal that this is the right time to be doing destination development in Ottawa. Those are examples of what we can be when we put our minds to something.
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Prevent your story from going bad Build a sound business succession plan with Scrivens
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Shawn Ryan, Partner, Senior Insurance & Estate Specialist
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business should be sold, and quickly, before the value eroded. The accountant said the business couldn’t be sold for two years, due to tax issues that would eat deep into the proceeds of a sale.
Upon hearing of a possible sale, more employees left for the competition. The value of the business and its assets began to slide. Barbara realized she might have to sell the family cottage to support herself. Obviously, Bobbie never grasped the distinction between an estate plan and a business succession plan. All of this could have been easily avoided with a proper business succession plan. In our next article, senior insurance and estate specialist Shawn Ryan will discuss Scrivens’ STEP by STEP approach to business succession planning. To learn more or to reach Shawn directly, visit www.scrivens.ca or call 613-782-1122.
MONDAY, NOVEMBER 23, 2015
ob “Bobbie” Smith had it all figured out. He was successful, well-regarded in his industry and had a solid 30-year marriage to his wife Barbara. His two children had recently graduated from university. His financial adviser thought his investments and the eventual proceeds from the sale of the business would enable them to retire soon. Bobbie had an estate plan, with a will that bequeathed everything to Barbara, but no business succession plan. When Bobbie died unexpectedly, Barbara was left with a business she had no interest in running. Bobbie had little life insurance, having always believed that he and the business had enough assets. But Bobbie had been the visionary of the business. His passing left both employees and customers concerned. Some began to leave. One of the sons suggested he could run the business, but he had no practical experience. The family lawyer suggested the
Why a business succession plan sits on the shelf: • Procrastination • Failure to understand that an estate plan is not the same as a business succession plan • Failure to obtain a proper valuation of the business • Failure to integrate the business succession plan with the estate plan • Failure to plan for the Four Ds: Death, Disability, Divorce, Departure • Failure to identify key employees who should be part of the succession plan • Treating a closely held business as a family rather than as a business involving family • Failure to diversify the business owner’s net worth from the business as a whole
LAUNCH PAD Giving a lift to children in need Ottawa powerlifters confident consumers will buy into new fitness apparel brand that believes in a strong social conscience
CHANGE LOG
BY ADAM FEIBEL adam@obj.ca
THE BETTER SOFTWARE COMPANY SEES EVEN BETTER RESULTS Soon after graduating from Kanata’s L-Spark accelerator program, The Better Software Company announced on Nov. 10 an additional $1.35 million in seed funding, bringing the Ottawa startup’s total amount raised to $2.1 million. New York’s ff Venture Capital led the new funding round, with local VC fund Mistral Venture Partners and other hometown angel investors also taking part. Since joining L-Spark in January, the business software company’s revenues have increased by a factor of 15, with a consistent growth rate of 35 per cent month over month.
MONDAY, NOVEMBER 23, 2015
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wo competitive powerlifters have launched a new socially conscious startup that’s designed to help provide access to clean, fresh water to children who desperately need it. Founded by Ottawa natives Mallory Rowan and Josh Reyes, LVD Fitness is a fitness apparel brand geared toward powerlifters like Ms. Rowan and Mr. Reyes who don’t fit the rough-andtumble image commonly associated with the strength sport. Powerlifting consists of three attempts at maximal weight on three lifts – the squat, the bench press and the dead lift – differentiating it from Olympic weightlifting in which athletes perform different lifts called the “snatch” and the “clean and jerk.” Ms. Rowan, 22, and Mr. Reyes, 21, are both nationally qualified competitive powerlifters who came up with the idea for LVD Fitness while studying business at Carleton University. As powerlifting gains popularity, the business brings something new to a burgeoning market of athletes that Ms. Rowan says often feel underrepresented in the sport. “There are a lot of brands within the powerlifting industry that are all skulls and very heavy,” Ms. Rowan says. “There’s a lot of powerlifters who are the big, bald tattooed guys, so a lot of the brands come from that side of it. But there’s a lot of us who aren’t like that … We wanted a brand that was more geared toward our personality.” The company sells lifestyle apparel such as T-shirts ($35), baseball caps ($35), hooded sweatshirts ($60) and decals ($5). After a soft launch in August during which it marketed itself locally and slowly gained a following on Instagram, the image-sharing app that’s the bread and butter of countless lifestyle brands, LVD Fitness officially opened its online retail store on Nov. 9. The company has earned upwards of $4,000 in sales so far, and the founders see lots of potential in its frequent sponsorships of various powerlifting events. LVD Fitness also uses its website as a forum for people in the powerlifting niche, sharing content from professional competitors who write guest blogs to share their tips. The company has also partnered with WaterAid Canada, an Ottawa-based organization that provides clean, fresh
Mallory Rowan and Josh Reyes are the founders of LVD Fitness. PHOTO BY MARK HOLLERON
“There’s a lot of powerlifters who are the big, bald tattooed guys, so a lot of the brands come from that side of it. But there’s a lot of us who aren’t like that … We wanted a brand that was more geared toward our personality.” – LVD FITNESS CO-FOUNDER MALLORY ROWAN
water to communities in 37 countries, mostly in Africa and South Asia. “Water was a really clear connection, because as athletes water fuels you more than anything,” says Ms. Rowan. According to WaterAid Canada, 663 million people worldwide lack access to clean water, and roughly 500,000 children die every year from diarrhea caused by unsafe water and poor sanitation. The organization works in partnership with local governments, non-governmental organizations and utility companies to deliver water services to poor and marginalized communities, with the goal of attaining global access to clean water by the year 2030. LVD Fitness donates 75 cents per item sold to pay for one month of free water for a child in those affected areas. To date, the company has donated enough to help 162 children and hopes to double
that total over the holiday shopping season. “It’s a great way to motivate people, because if you’re buying a T-shirt and you throw in a decal, you help two people instead of one,” says Ms. Rowan. It also bodes well for the company considering the buying interests of consumers their age. A 2012 study by ad agency network TBWA found that 71 per cent of young adults are more likely to purchase from a company that supports a cause they care about. Ms. Rowan says that while previously working in marketing for startups, she had researched the buying habits and philosophies of the millenial generation and found that those consumers are especially concerned with corporate social responsibility. “It’s crazy to see the stats,” she says. “There’s a lot of statistics that show that consumers do care.”
OTTAWA INCUBATOR KITCHEN GETS COOKING Local entrepreneurs hoping to enter the food business can look to the recently opened Ottawa Incubator Kitchen for a recipe for success. The business incubator near St. Laurent Boulevard offers a “cost-recovery, low-risk, full-service commercial kitchen” led by Paul Gorman, president of Natural Gourmet and Mountain Path Organic and Natural Foods, partnered with sustainable food and farming group Just Food. For a monthly fee of $10 to $40 per startup, consultants will help with production, packaging, marketing and distribution, and members can access seminars, events and space to develop their food businesses. SNOWED IN? SNOWMOWR HAS AN APP FOR THAT As the city’s dreaded onslaught of snow fast approaches, an Ottawa company has launched a smartphone app that will let users order one-time, on-demand snow removal services whenever their driveway needs a good plow. SnowMowr spent a year developing the software to “make people’s lives easier and the winter months more bearable,” CEO Omid Manoussi said in a statement. Using the app, which will launch Jan. 6 at the latest, Ottawa residents can place an order that will be picked up by a registered contractor, with the entire transaction done on a smartphone – thus its nickname, “the Uber for snowplows.” CAPITAL ANGELS FUND SIX OTTAWA STARTUPS The Capital Angel Network announced its recent funding for six local startups Nov. 5, with The Better Software Company, ChangeJar, Eirsen Health Care, Mydoma Studio, Sharethebus and Spoonity each receiving a financial boost from the angel investor group. Capital Angels has invested $23 million in 40 companies since its inception in 2009.
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BEAGLE SENSE OFFERS ITS TECHNOLOGY FOR STEM EDUCATION Ottawa startup Beagle Sense announced in early November that it will make its home sensors available to 150,000 elementary and high schools across North America in what it’s calling “a massive contribution to STEM (science, technology, engineering and mathematics) education and innovation.” The startup makes sensors that measure air quality and pressure, humidity, temperature, light and noise levels.
LOCAL STARTUPS HEADED FOR 48 HOURS IN THE VALLEY Gatineau-based Foko and Kanata’s Graphite Software have been selected for C100’s 48 Hours in the Valley winter 2015 cohort. They will join 15 other companies flying to San Francisco for a series of meetings and events between Dec. 7 and 9. The C100 is a San Francisco-based non-profit group focused on connecting Canadian companies with partners in Silicon Valley.
CALENDAR
Invest Ottawa, 80 Aberdeen St. Info and registration at investottawa.ca/events
StartUp Drinks ByWard Market Monday, Nov. 23 at 5 p.m. Aulde Dubliner Pourhouse, 62 William St. Info and registration at eventbrite.ca
StartUp Drinks Kanata Wednesday, Nov. 25 at 5 p.m. The Royal Oak, 329 March Rd. Info and registration at eventbrite.ca
Effective Change Management: Make Change Stick! Knowledge Builder Tuesday, Nov. 24 at 1 p.m. Algonquin College Corporate Training Centre, 340 Albert, St., 11th floor Info and registration at algonquincollege.com/ corporate/events
Opportunities Networking Breakfast: Global Entrepreneurship Celebration Thursday, Nov. 26 at 8 a.m. Perkins, 1130 St. Laurent Blvd. Info and registration at eventbrite.ca
The Ups & Downs of Startup Life Wednesday, Nov. 25 at 10 a.m.
TONs TON of Demos Thursday, Nov. 26 at 6:30 p.m. Clocktower Brew Pub, 418 Richmond Rd. Info and registration at eventbrite.ca
Celebrating
extraordinary people.
by Bruce Lazenby, President and CEO, Invest Ottawa
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urning a dream into a reality can be a bit like hunting for treasure without a map; you know the target but you’re unsure about the little steps along the way. Let Invest Ottawa be that roadmap. Our mission is to guide each prospective entrepreneur along their unique path. WORKSHOPS AND SEMINARS Every day, we host free workshops for entrepreneurs interested in learning new skills. These sessions have helped thousands of small business owners quickly ramp-up and understand the common issues faced when starting and growing a business. E-Commerce, legal considerations, market research, bookkeeping and importing/ exporting are just some of the topics covered. All of our speakers are experienced professionals, practitioners and entrepreneurs who happily share their lessons learned. INCUBATOR We’re looking for the brightest and
most talented people with the best ideas. Our incubator is focused on ensuring startups are ready to meet with investors. From day one, companies are matched to a mentor and coach. This relationship remains in place for a company’s typical residency of six months to one year. Startups also have access to networking events, workshops with thought leaders, market research and much more. The goal is to create an environment that prepares companies to find successful growth through financing or market entry. But we aren’t the only game in town – Ottawa has a thriving startup community with a multitude of programs to incubate a variety of different businesses across an array of industries and stages. Let us help you figure out the right one for your startup. BUSINESS ADVICE Getting the right advice early on can save time and money. Invest Ottawa has a range of mentorship services designed to help you avoid common pitfalls. Mentorship and business advice may be general or specific depending on your company’s needs and requirements. Most of our mentors have started and grown successful global companies across several knowledge-based industries, raising significant funds from angel and venture capital investors. They have additional expertise in other areas like partnership development, mergers, acquisitions, and initial public offerings. This just scratches the surface regarding all the ways Invest Ottawa can help your business. Please visit investottawa.ca to find out more.
MONDAY, NOVEMBER 23, 2015
Congratulations to our successful 2015 Chartered Accountant Uniform Evaluation (UFE) writers in Ottawa. These dedicated and talented KPMG professionals have achieved a significant milestone on their way to receiving their Chartered Professional Accountant (CPA) designations.
Getting Your Business Started Today
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Eric Saumure Mike Novacaska Ernie Currie Omar Husain
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WORKSHOPS ARE HELD DAILY AT THE INVEST OTTAWA OFFICES. PHOTO BY INVEST OTTAWA
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GO GLOBAL
Searidge Technologies CEO and co-founder Moodie Cheikh says the 40-person firm’s revenues have increased by 60 per cent this year. PHOTO BY MARK HOLLERON
Aerospace firm’s video technology takes flight in international markets From a small office in Ottawa, Searidge Technologies is reshaping the way the world’s air traffic controllers work — and the way the airports will function in the future BY ADAM FEIBEL
MONDAY, NOVEMBER 23, 2015
adam@obj.ca
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here’s a technological movement happening in one niche of the world’s aerospace industry, and a small Ottawa company has been a guiding part of the liftoff. Those who have travelled by airplane just about anywhere in the world will probably recognize the tall, 360-degree windowed towers standing high above the airport. These air traffic control towers monitor activity within the airport surface, such as runways, taxiways, gates and the surrounding airspace. In Canada, there are 41 air traffic control towers and seven area control centres that monitor more than five million aircraft movements a year. As air traffic volume continues to
grow, airports looking to meet the demand stand to benefit greatly from new technology designed to optimize the surface of an airfield, says Moodie Cheikh, co-founder and CEO of local firm Searidge Technologies. “It kind of seems archaic that there are people sitting in a building looking out the windows … (given) the state of technology today,” says Mr. Cheikh. “That’s one of our highest growth opportunities right now, it’s addressing exactly (that).” Searidge, founded in 2001, sells a patented proprietary video platform that presents a real-time digital image of all areas of an airport surface, including those that might be fully or partially blind to the air traffic controller, and builds in additional safety features. The 40-person company supplies both air traffic control organizations and
the airports themselves, with revenues split almost evenly between those two streams. Searidge’s revenues increased by 60 per cent this year, the most lucrative of the last five consecutive profitable years. In 2008, Searidge became the first company to implement an operational video system in an air traffic control tower when its technology was adopted by Abu Dhabi International Airport in the United Arab Emirates. Since then, the company has won contracts at almost 30 airports in just shy of 20 countries. Searidge’s international customers include Heathrow Airport in London, Charles de Gaulle Airport in Paris, Dubai International Airport and Hamad International Airport in Qatar. Canadian clients include airports in Ottawa, Edmonton, Halifax, London, Montreal, Toronto and Winnipeg.
“We’re pretty proud that this little Ottawa technology company was the first to do this in such a heavily regulated industry,” says Mr. Cheikh. Indeed, the adoption cycle for new technology is quite long in a highly riskaverse and safety-critical environment. “It was a lot more conservative than we even thought it would be,” says Mr. Cheikh. Searidge needed to not only prove its technology is more safe than existing methods, but also to show that it won’t slash employment. Air traffic controllers were ranked third in Canadian Business’s list of Canada’s best jobs in 2015, with a median salary of $87,360. It’s already a selective job market, with roughly 5,100 employees at what’s essentially the country’s only employer for the profession, the capital corporation NAV Canada (which has actually owned
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Searidge since 2010). But Mr. Cheikh says technological intervention will actually be better for labour, since in addition to currently employed controllers using the technology to perform their jobs more efficiently, even more air traffic experts will be needed to oversee air control centres offering service to sites where there was no service before. In Sweden, for example, the Örnsköldsvik Airport in the country’s central east region recently became the first airport in the world at which the control tower is unoccupied and controlled remotely by air traffic controllers viewing the video from kilometres away, powered by a Searidge competitor, a Swedish aerospace company called Saab. Örnsköldsvik Airport is one example of a site that’s essential to local residents, yet too small to justify the cost of a multimillion-dollar control tower plus the salaries of multiple controllers. Searidge says it’s also a solution for airports with only seasonal traffic, airports that have low visibility and airports located in remote areas where there are staffing shortages. Those scenarios are where Searidge sees huge potential. “We’re able to provide services to sites that haven’t been fortunate enough to have services because they don’t meet the minimum criteria for complex traffic or volume,” says Mr. Cheikh. Optimization can also solve issues at the world’s largest airports such as Heathrow, which are already running at full capacity. Passenger volume has been increasing by five to seven per cent per
year globally, and in some areas such as China and the Gulf states it is growing at an even faster rate. Searidge says its technology would better optimize airports’ surface areas in order to fly more airplanes in and out.
“We’re pretty proud that this little Ottawa technology company was the first to do this in such a heavily regulated industry.” – MOODIE CHEIKH, CO-FOUNDER OF SEARIDGE TECHNOLOGIES
About a year ago, Hungary awarded Searidge a contract to video-automate Budapest Ferenc Liszt International Airport so that its airport surface traffic is remotely managed at a control centre a few kilometres away. Mr. Cheikh says a handful of other countries, including Italy’s air traffic control service provider, ENAV S.p.A., are also “very aggressively” pursuing remote towers. “If you’re restricted on the ground to the point where you just can’t bring in any more airplanes,” he says, “you’re ultimately restricting the airline’s ability to fly people in and out of your country.”
Where is your business taking you? YOW surveying local businesses for route expansion
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assenger planes don’t just fly anywhere. Airlines need a convincing business case before they will dedicate one or more of their birds to a new route. It’s a complex juggling act between expected passenger volumes and revenue, and aircraft availability and operating costs. It’s usually up to an airport to provide an airline with compelling evidence why a new route is warranted and financially viable. “Airline network planners are looking as for as much tangible information as they can get,” said Mark Laroche, President and CEO at the Ottawa Airport Authority. “It’s valuable to know how many people travel to a specific destination and how many continue on from there to others.”
Business travelers are key
YOW wants to hear from you
Tell YOW where you want to go
So where is your business taking you? How are you getting there? San Francisco, for example, is one key destination that does not currently have non-stop service from Ottawa. Would a new flight to that destination or another benefit your bottom line? Would an airline be able to count on sufficient passengers to fill the plane? If so, the Ottawa Airport Authority wants to hear from you. You don’t have to wait for that phone call to share your thoughts. You are always welcome to contact the Ottawa Airport at any time, at www.yow.ca/fly
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So the Ottawa Airport is engaging an industry research firm to reach
out to the local business community with telephone, web and in-person surveys through the end of this year. “We need to understand how many business travelers are flying to a particular destination by whatever route,” Laroche said. “From there, we can determine if we can get a viable load factor and yield to sustain non-stop service or an increase in frequency of an existing flight.” Once a route is established, there will always be additional customer volumes that will be stimulated by its availability, such as other tourism and leisure travelers, said Laroche. Ottawa’s daily flight to London is a perfect example. “This is a route that local residents shouldn’t take for granted,” he said. “It connects us to one of the world’s global hubs and opens us up to the entire European continent. Many of these passengers continue on to other destinations.”
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“Unlike the typical price-conscious leisure traveler looking for seat sales and other discounts, business travelers fly on more predictable schedules and are more tolerant on fares,” Laroche said. For Ottawa, the average load factor (percentage of seats filled per flight) is less than the industry norm, at about 70 per cent versus 80. On the other hand, business travelers represent a higher than average proportion of local travelers. “Because those business travelers are often willing to pay more on average than the typical leisure traveler, it makes up the difference,” said Laroche. But who are these business travelers, where are they going, and will they go more often if there is nonstop service? These are the questions the Ottawa Airport must answer to understand where there is a need and an opportunity to approach an airline about adding a new route. The problem is, the answers can’t accurately be found just by looking at historical passenger volume data.
Mark Laroche, President and CEO, Ottawa Airport Authority
COMMENTARY The harsh truth about startups Jeffrey Dale says Canada’s incubators and accelerators need to get tougher with new businesses to prepare them for a global market in which only the strongest survive and seemingly great ideas fail to catch on
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few weeks ago, I had the honour of attending a youth entrepreneurship roundtable with Prince Edward, Ontario Lt.Gov. Elizabeth Dowdeswell, Ryerson University president Sheldon Levy and a number of young and older entrepreneurs. You can guess what category under which I was invited. The event was held at Ryerson’s DMZ, an incredible startup incubator and shared workspace in downtown Toronto. Prince Edward, Queen Elizabeth’s youngest son, is involved in a number of youth initiatives, and during his visit he wanted to connect with young entrepreneurs. The roundtable included young businesspeople from a range of backgrounds: a high school student who was already working on his second startup, graduates from Ryerson’s accelerator programs and members of a couple of youth-based social enterprises. The hour-long discussion touched on a variety of topics, including the challenges of being a young entrepreneur, how the education system supports budding business owners and what can be done to improve the entrepreneurship experience for youth. The participants had plenty of energy and excitement, but overall the event was very predictable. Afterwards, however, I had a chance to speak with a number of the participants and other entrepreneurs working out of the DMZ. What I learned was quite revealing about Canada’s startup culture. The competition for space in the DMZ is high, and some of the startups talked about “squatting” in a facility that is packed to the rafters. Others noted the huge number of companies in the DMZ makes it very difficult to find experienced mentors and sources of funding. Most of these entrepreneurs said they were frustrated that they completed the accelerator program only to find they could not get funding to take them to the next level. Many of them seemed to think venture capital firms and angels would be eagerly lining up to offer “free” money to help them build their businesses. Today’s entrepreneurs have great expectations of success, and in some ways you can’t blame them. Over the past decade, federal, provincial and municipal governments have invested hundreds of millions of dollars into entrepreneurship,
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Successful entrepreneurs such as You.i TV’s Jason Flick know it takes a strong, well-executed business plan to make the leap from startup to sustainable enterprise. FILE PHOTO
mentoring, accelerator, proof of concept, financing and other programs. National organizations such as Startup Canada and local programs including Startup Garage, GrindSpaceXL and L-Spark have helped foster a more entrepreneurial culture. Across Canada, hundreds of companies are graduating from accelerator programs every year. That would be considered a great success – if the long-term goal was only to create startups. But what is next for these companies? Canada’s young entrepreneurs have received lots of early-stage support, leading to an explosion in the number of startups competing for investment. But the real challenge isn’t starting companies, it’s growing them into sustainable businesses. Unfortunately, that has made the “natural selection” of the best and brightest firms a much more difficult task. Investors are hesitant to pour money into startups spawned by an accelerator such as the DMZ, because the sheer number of companies makes it difficult and time-consuming to determine which ones have the highest ceiling. In addition, many of the tech
entrepreneurs I spoke with at the DMZ have based their business models on developing an app in the hope of becoming the next Uber. A model that limited in scope is very difficult to expand into a viable business. In fairness, I am very impressed with the knowledge and capabilities of these young entrepreneurs. They have great ideas, but they lack the experience to know what really makes a company viable and the effort it takes to convert their ideas into sustainable business models. In his book The Hard Thing About Hard Things, Ben Horowitz argues that building a business is difficult and building a really successful one is even harder. The next generation of startup entrepreneurs needs to learn that lesson if Canada really wants to build an innovation economy. Organizations such as Invest Ottawa and Waterloo’s Communitech are modifying many of their startup programs and services to address this challenge. They have graduated dozens of high-potential startups that are now realizing the tough part is just beginning. At the startup stage, entrepreneurs are focused on general issues such as
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National organizations such as Startup Canada and local programs including Startup Garage, GrindSpaceXL and L-Spark have helped foster a more entrepreneurial culture. Across Canada, hundreds of companies are graduating from accelerator programs every year. That would be considered a great success – if the long-term goal was only to create startups. But what is next for these companies? building their board, protecting their intellectual property, developing a marketing plan and finding their first customers. At the growth stage, success is about execution. Every step has to be highly customized to each individual business, its market and its team. Cookiecutter solutions won’t work. Providing this level of support is very labour- and time-intensive. The ability to help every and any entrepreneur is not realistic, nor is it warranted. Canada’s incubators and accelerators need to start the “natural selection” process early, weeding out applicants immediately and accepting only the companies with the highest probability of success. These organizations need to teach startups to execute a plan based on clearly defined milestones and deadlines. If the companies fail to meet those targets, they should be dropped from the program – no ifs, ands or buts. Experienced advisers and mentors are critical to this process. The Business Development Bank of Canada has taken this concept to the next level with its BDC Advantage program.
The program assists high-growth firms that have advanced past the startup stage with services beyond financing, offering advice, formal management training, peer-to peer networking support and referrals to outside experts. BDC is a key provider of financial assistance to growing Canadian businesses, and it knows its most successful clients are the ones with strong, well-executed business plans. The BDC Advantage program helps them achieve their goals. Canada’s startup community should take note. Statistics tell us most businesses in Canada fail to make the leap from startups to growth companies. Our entrepreneurs have proven they know how to start businesses. But their longterm success will be determined by how well they are able to scale those startups into sustainable enterprises that thrive on the international stage. Jeffrey Dale is the president of Snowy Cloud and the former president of the Ottawa Centre for Research and Innovation.
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BEST OTTAWA BUSINESS 2015 RECIPIENTS
Performance profiles EXPORT
B-Con Engineering
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Time and again, we hear how building a strong export business is vital for Canadian technology companies, given our relatively small domestic market. The classic 80-20 rule is often referenced – 80 per cent of revenues should be derived from exports. Last year, B-Con Engineering topped that, growing its export sales by almost a third to account for 93 per cent of its revenue. “Exporting, like any area of business, is about networking,” said president Brian Creber. “We network well in the export market. We also have established a reputation for attempting and succeeding at projects where others fail.”
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Established in 1988 as a contract optical system design and prototype fabrication service provider, B-Con continues to meet the high-tech sector’s critical needs for optical engineering and optical component fabrication. It holds numerous patents in the diamond turning and metrology fields, serving the aerospace and military, display technology, medical/biotechnology/ ophthalmic and automotive industries. Over the years, B-Con has grown by continually investing in its infrastructure and people. Not only does it export to the United States, Australia and Europe, its technology is even on Mars as part of the Phoenix Mars mission with NASA’s Jet Propulsion Laboratory.
SUSTAINABILITY
KRP Properties KRP Properties (formerly the Kanata Research Park) is no stranger to Ottawa’s tech scene. It was ground zero during Ottawa’s telecom
heyday and continues to be a hotbed of innovation and world-leading commercialization. Change is the only constant. The KRP team is keeping up with the times with its own sustainability plan, which it says is the only custom-designed one in Ottawa. In the same spirit as industry-leading standards such as LEED and BOMA BEST, KRP has set out to create a framework for program implementation, performance and assessment to certify properties to its KRP Green designation. The focus is on energy and waste reduction, water conservation, green cleaning and sustainable purchasing, site operations, transportation and communications. No one is left out and everyone is empowered. KRP’s plan engages all of the moving parts of the building community, including leasing, operations, construction, accounting and administration. It invests heavily in skills-based professional development for its staff, including environmental training, to ensure the KRP portfolio runs like an “energy-efficient, welloiled machine.” Take lighting, for example. Earlier this year, building operator Ed Weir piloted his own lighting retrofit and other energy-saving projects. The results
and cost savings were so compelling, KRP expanded Mr. Weir’s pilot across its portfolio. In three buildings alone – 411 Legget Dr. and Blackwood Towers A and B – the energy savings have so far added up to 455,000 kilowatt hours.
PHILANTHROPY
Telus
Telus might be a national telecom services company, but its philosophy is to “give where we live by using the power of technology and communications to improve people’s lives in our local communities.” Through its community boards, decision-making is put in the hands of local leaders who know their communities best. The Telus Ottawa Community Board was formed in 2005. Since then, it has contributed more than $4.7 million to grassroots charitable organizations that have supported 320 community projects
BEST OTTAWA BUSINESS 2015 RECIPIENTS in the National Capital Region. Chaired by Jim Orban and driven by other community leaders such as police chief Charles Bordeleau and former Community Foundation of Ottawa CEO Barbara McInnes, the board is particularly focused on the issues facing youth in the Ottawa region. Recent initiatives include $35,000 in funding for the Youville Centre, which works to motivate, educate and nurture young mothers and their children, $130,000 in total contributions to the Children’s Hospital of Eastern Ontario and $20,000 to the Ottawa Children’s Treatment Centre. It’s a track record that Telus is committed to sustaining by engaging current employees and retirees with structured volunteer and donation opportunities to help make a positive difference in their communities. This includes the annual Telus Days of Giving campaign. Since 2000, Telus, its employees and retirees have contributed more than $71 million and 470,000 volunteer hours to charitable and community organizations throughout Ontario. Ottawa’s share of that amounts to an impressive $14.5 million and more than 50,000 volunteer hours.
MARKETING
Shaw Centre Ottawa upped its weight class in the fiercely competitive international meetings and conventions market when the Shaw Centre opened four years ago. The tireless team at this world-class facility hasn’t stopped since, constantly coming up with new ideas to promote the venue and offer users a fresh and unique experience. Take crEATe Kitchen, an interactive cooking and dining experience. With a budget of only $3,500, the Shaw Centre team came up with the idea to promote the program to all of Ottawa’s food bloggers and critics through one unforgettable six-course dinner. Fifteen invitations were delivered by messenger. Fourteen confirmed. The invitations were engraved on a cutting board and placed inside a black box with a blue ribbon, resting on a bed of rosemary twigs. By the time the evening was over, the social media buzz resulted in an estimated 250,000-plus impressions – great visibility
for crEATe. “The event was truly as unique as the invitation,” said local food writer and Ottawa at Home contributor Paula Roy. “The Shaw Centre team really hit it out of the park with this event. They wanted to showcase the possibilities that crEATe kitchen has to offer and they did this well ... It would be an ideal location for a special private event, media event, girls’ night out parties, anniversaries or perhaps businesses wanting to host a high-end VIP experience for their clients.”
HR
Hydro Ottawa Retiring baby boomers are taking with them decades of practical and institutional know-how that could be critical to an organization’s continued growth and success. With about 44 per cent of its trades and technical workforce expected to retire within the next 10 years, Hydro Ottawa took action through its Prime Time Program.
“What we set out to do was retain great employees, benefit from their knowledge longer and arrange for them to transfer that knowledge to another generation,” said Lyne Parent-Garvey, Hydro Ottawa’s chief human resources officer. The key to success has been engaging the employees and retirees who stand to benefit the most from the program in the process of developing and delivering it. The idea is that this is their “Prime Time,” rather than the end of their careers. Prime Time is part of Hydro Ottawa’s broader talent management strategy that takes a multi-generational and multi-faceted approach to maintaining operational continuity and capacity. Prime Time embraces older workers’ growing interest in redefining the later stages of their careers, supports a positive experience through the transition to retirement, embraces generational diversity and identifies ways for retirees to continue contributing to the organization after retirement. The results are already speaking for themselves. The average age at which older workers choose to retire has risen to 60 from 57 just three years ago. Prime Time recently earned Hydro Ottawa a Best Talent Management Strategy award at the 2015 Canadian HR Awards.
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To what extent must employers assist employees in meeting family needs? Courts, arbitrators have sought to strike balance between family, work
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ll employees who have children will at some point experience a conflict between their work-related obligations and their family-related demands. For some time in Canada there has been uncertainty around the extent to which employers are required to accommodate employees’ family-related needs, whether by revising work schedules or being flexible in applying other work policies or rules. Two Federal Court of Appeal decisions have made it clear that employers must be open to considering such requests and, where required, may need to consider accommodation. However, the decisions seek to balance the interests of employers and employees by making it clear that there are limits to what an employee is legally entitled to expect from their employer.
What an Employee Must Demonstrate – the “Johnstone Criteria” The Federal Court of Appeal has held that an employee who requests to be accommodated on the basis of family-related needs must demonstrate the following four conditions exist: •
that a child is under his or her care and supervision;
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that the childcare obligation at issue engages the individual’s legal responsibility for that child, as opposed to a personal choice;
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that he or she has made reasonable efforts to meet those childcare obligations through reasonable alternative solutions, and that no such alternative solution is reasonably accessible; and that the impugned workplace rule interferes in a manner that is more than trivial or insubstantial with the fulfillment of the childcare obligations.
The Johnstone Criteria Applied Despite being a decision of the Federal Court of Appeal, the Johnstone criteria have been applied in recent decisions issued by Ontario arbitrators, courts, and the Human Rights Tribunal of Ontario (HRTO). In an HRTO decision, a member of a Board of Directors complained about a change in the time of the Board meetings on the basis that it conflicted with her need to pick her daughter up
from private school and drive her to swimming lessons. The HRTO found that the Board’s failure to accommodate in these circumstances was not contrary to the Ontario Human Rights Code since swimming lessons are a matter of personal choice and not a legal obligation. An Ontario Superior Court decision, in applying the Johnstone criteria, awarded $20,000 for human rights damages in a wrongful dismissal case that raised family status discrimination, in part, as a deterrent to employers who are unwilling to accommodate childcare arrangements, except where legitimate, justifiable grounds exist for being unable to do so. This was in addition to 12 months reasonable notice awarded by the Court for wrongful dismissal.
Eldercare Obligations In an HRTO decision that pre-dated Johnstone, the Tribunal found that “family status” also covers situations in which employees have “eldercare” obligations toward their aging parents. The Johnstone criteria were recently applied by an arbitrator in finding that an employee had made no arrangements to have third parties care for his parents while he was commuting and at work, and that his eldercare obligations did not require him and his parents to live
in Ottawa. His choice to continue living in Ottawa, notwithstanding that his job was in Peterborough, was a personal preference.
What Employers Must Do Employers are required to consider all employee requests for accommodation based on childcare or eldercare needs. Requests must be considered on a case-by-case, individual basis, taking into account the employee’s specific circumstances and the efforts to seek out alternative solutions. It is advisable that employers adopt clear policies that set out how such requests will be addressed and ensure that all requests are dealt with in a consistent manner. More than anything, if an employer’s response to such a request is challenged, it will be important for an employer to be able to demonstrate a willingness to be flexible and to examine potential avenues for assisting employees whose circumstances warrant it. For more information, visit Emond Harnden at www.ehlaw.ca
BEST OTTAWA BUSINESS 2015 RECIPIENTS SALES
Rumidifier Home Comforts In a few short years, Rumidifier Home Comforts has become an Ottawa success story. Jeri Rodrigs struck on the idea after his sick son needed a humidifier for his bedroom and he wanted a quieter and more environmentally friendly solution than the typical plug-in appliance. The Rumidifier uses no electricity. Instead, it just sits over an existing heating vent and uses that flow of air to humidify a room. Rumidifier’s sales strategy from the outset has been to open up as many direct accounts with big-box chain stores as possible in order to quickly achieve positive cash flow. Pilots with local stores have led to national distribution deals and tens of thousands of unit sales at hundreds of stores. This year alone, Rumidifier has added Costco, Canadian Tire, The Shopping Channel and etailz, which now gives it reach into the U.S. market. This is
in addition to relationships with Home Depot, Home Hardware and terra20. Revenue for 2015 is on track to eclipse last year’s mark by a factor of six. Rumidifier has expanded its product line with new products that target other market segments while staying true to its focus of “eco-friendly, non-electric room humidifying solutions.” The company is now in the enviable position of having retailers knocking on its door.
Companies of the year Neptec Neptec has been an anchor of Ottawa’s aerospace industry for 25 years. The company’s hallmark is the design, production and support of laser, infrared and optical sensors for satellites and space exploration. Its
systems have assisted in the construction of the International Space Station and inspected the Space Shuttle to ensure safe returns from orbit. The company is currently developing a camera that will be used to allow rovers to navigate Mars’ terrain and a laser camera that will be used to guide a spacecraft to a safe landing on the moon. Over the years, Neptec has participated in more than 40 space missions. Its staff has logged in excess of 10,000 hours working in mission control at NASA’s Johnson Space Center in Houston. In addition to its space work, Neptec has developed sensors to inspect oil and gas infrastructure on the floor of the ocean. A spinoff company, Neptec Technologies, produced sensors for the mining and construction industry to improve safety and increase productivity, as well as technology for helicopters operating in low-visibility conditions. Neptec operates research, engineering and production facilities in Ottawa, Houston and Harwell, England. Its 85 employees have broad expertise in advanced sensors, optics, 3D algorithms, software, electronics, mechanical engineering, systems integration, project management and manufacturing. Major customers include NASA, the
Canadian Space Agency, the European Space Agency, Orbital ATK, Boeing, Sierra Nevada Corp. and Airbus Defence and Space.
Versature Versature was born out of founder Paul Emond’s own needs and challenges as a small business serial entrepreneur. Over the past 12 years, it’s grown into a viable alternative to traditional telecom offerings, providing voice-overInternet protocol services to small and mid-sized businesses in hundreds of communities across Canada. Growth is on a tear, averaging 30 per cent year over year. Versature now has more than 7,000 subscribers. Innovation and adding value to clients have proven to be what sets the company apart from its competition. In addition to reliable VoIP service, Versature also provides integration with Salesforce.com to feed call activity directly into Salesforce’s customer relationship management system with a single click, as well as a
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BEST OTTAWA BUSINESS 2015 RECIPIENTS social caller ID service that delivers social insight on all incoming calls beyond traditional call display. All of this has Versature on track to achieve its seven-digit revenue target, but the company isn’t just about sales. Versature recently reached the 1-1-1 corporate philanthropy designation. That means it pledges one per cent of its equity, one per cent of its time and one per cent of its services to charitable endeavours.
Martello Technologies While Martello Technologies might not be a household name yet, its early success as a SaaS (software-as-aservice) innovator has already placed it alongside Canadian tech heavyweights such as Shopify and Halogen. Its revenue growth for the past three years surpassed 600 per cent, brisk enough to propel it to the No. 1 spot on OBJ’s list of Ottawa’s Fastest Growing Companies for 2015. It’s also grown its head ount by about 90 per cent over the past year. The company attributes its success
to a unique business model that combines SaaS innovation with unified communications (UC) expertise and a focus on one key vendor partner: Mitel Networks. Add a dash of vision to capitalize on the growing trend towards cloud-hosted UC, and you have Martello’s formula for success. Martello has been developing fault and performance management software for unified communications, with a specialization in Mitel solutions, since 2009. Its MarWatch software helps service providers deliver better voice-over-Internet protocol quality to their customers. MarWatch monitors performance metrics such as voice quality around the clock, sending real-time alerts when a problem is detected and providing tools such as remote access and active testing to quickly resolve the problem. To some extent, the company was “in the right place at the right time.” Cloud-hosted UC was growing rapidly, network complexity had ratcheted up significantly and Martello had a solution that managed network complexity easily. At the same time, key partner Mitel doubled in size through the acquisition of Aastra, expanding the global market for MarWatch.
Ross Video David Ross has led the charge as CEO of Ross Video for 24 years, turning a small family-owned company into a global success story. One of his goals has been to “create a company that’s hard to kill,” through diversification by geography, customer type and breadth of product portfolio. The company’s customer base is global, but it remains one of eastern Ontario’s largest employers. Ross Video still operates its original manufacturing plant in Iroquois, an hour south of Ottawa, in addition to its operations in the nation’s capital. Ross Video operates by a code of ethics that empowers any employee to call even senior management’s behaviour into question if a situation warrants. But it is world-class technology, in addition to a great team, that lies at the company’s heart. Ross Video is one of the most dynamic businesses in the global broadcast and production technology industry. It aggressively grows its market share against industry giants such as Sony and
Panasonic, putting Ottawa on the map with entertainment companies all over the world. The company has enjoyed consistent average annual revenue growth of 18 per cent for the past 24 years, exports to 144 countries, and it has made 10 acquisitions in the past six years and employs 580 people. Ross Video and its CEO are both staunch supporters of the Ottawa community. The company is a United Way workplace supporter and matches its employees’ contributions. Donations to date total in the six figures.
You.i TV The Internet has broken the living room. Services such as Netflix, Apple TV, Roku and Chromecast mean consumers are spoiled for choice. Television broadcasters and service providers are investing billions of dollars to develop and maintain new multi-screen applications so they can remain relevant and retain their audiences. This investment is scattered on an
FOR SALE - COMMERCIAL
Bailey Church and Andrew Watson Partner with our extraordinary leaders. KPMG’s office in Ottawa is proud to introduce our new Assurance partners, (l-r) Bailey Church and Andrew Watson, welcome additions to our growing leadership team.
MONDAY, NOVEMBER 23, 2015
With over 17 years of experience, Bailey is the Co-Leader of KPMG’s National Public Sector Accounting Advisory services. He has an extensive background serving governments at all levels as well as not-for-profit organizations and for-profit entities.
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FOR LEASE - COMMERCIAL
Andrew has over 14 years of experience in public accounting, serving both public and private companies reporting under Canadian accounting standards for private enterprises, IFRS and US GAAP. Both Bailey and Andrew demonstrate commitment to client service excellence, passion in community leadership and dedication to help clients grow their businesses. Contact them to find out how they can help you. Bailey Church 613-212-3698 bchurch@kpmg.ca Andrew Watson 613-212-3653 apwatson@kpmg.ca
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BEST OTTAWA BUSINESS 2015 RECIPIENTS ad-hoc basis among a variety of graphic design studios and software development firms. There has been no single common platform on which to build, manage and update television apps as the market and the technology has evolved. You.i TV has set out to change that by adopting the playbook of the video game industry. The Ottawa-based company has created a software development engine that simplifies and accelerates the creation of immersive custom TV apps that run fluidly on any screen. Over the past year, revenues have grown fourfold. The company has worked with leading media brands, including Sony’s Crackle, Rogers and Corus Entertainment, and is now on an aggressive hiring spree to double its local workforce. In September, You.i TV got a boost: $15 million in funding from Los Angeles venture capital firm Kayne Partners. Chief executive Jason Flick was also recognized recently as Startup Canada’s Ontario Entrepreneur of the Year. You.i TV’s competitive advantage is based on proprietary technology, as well as an innovative business model. Later this year, You.i will open its software development kit to selected partners to empower them to build video apps on top of the You.i Engine.
Best new business profiles Clariti Group Clariti Group was born out of a desire to help individuals and employers make informed decisions around career and leadership. The company was founded by Tara Azulay, a 17-year veteran of the recruitment and placement industry, and Kevin Barwin, who has more than 20 years of experience as a senior manager in sales, business development and operations. Clariti shares the lessons its team has learned through decades of combined experience with others who might be facing career challenges, transition or leadership development considerations. It’s committed to providing clear and
comprehensive career and leadership coaching programs, as well as workshops for teams. Clients include public- and privatesector organizations of all sizes, as well as individuals funding their own career transition or leadership development. The firm’s services are fully customized to the needs of each individual or organization. Clariti also augments its offering through its partnership with Toronto’s Actionable Books. The latter’s Actionable Workshops training and development platform builds on insights from popular business books to drive employee engagement, and Clariti is the only Ottawa company certified and licensed to offer the workshops. Fundamentally, Clariti’s mission is simple: to help individuals and teams achieve great careers. That focus is paying off. In the past year, Clariti has tripled net profits and expanded its customer base across Canada and its team has grown to include 18 associate coaches and facilitators. Not bad for a business that was bootstrapped by its two founders and funded entirely through its own sales.
Solink The high-tech tree planted in Ottawa by Sir Terry Matthews continues to sprout new branches. One of the latest additions is Solink. This datadriven security platform company, led by CEO Michael Matta, broke away from its sole sales and channel partner, March Networks, a year ago and hasn’t looked back. Solink’s Video Discovery application captures and audits 100 per cent of video surveillance and transactional data to reduce fraud proactively. Users can search for any event without having to manually retrieve evidence by time and location. For a monthly fee, the platform provides everything users need to collect, analyze, investigate and manage their data. Solink has a high-powered team behind it. The company’s board includes Mr. Matthews, Wesley Clover president Paul Chiarelli and former Mitel CEO Don Smith. Its crack staff includes talented coders from around the world, working through problems seen as too difficult by the
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Université d’Ottawa
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University of Ottawa
WELCOME TO OUR NEW CHANCELLOR The University of Ottawa proudly welcomes Calin Rovinescu – an outstanding uOttawa alumnus – as our 14th Chancellor. An accomplished leader with a distinguished international professional career, Mr. Rovinescu has extensive experience in law, finance and business and, as President and CEO of Air Canada, has earned wide recognition for his exceptional acumen and insightful leadership. In 2013, he was named Canada’s CEO of the Year by Report on Business magazine and has served as Chairman of Star Alliance and IATA. Mr. Rovinescu has a long record of philanthropic and community services and has served on the boards of many private and non-profit organizations. Through the Air Canada Foundation, he has demonstrated his deep commitment to children’s causes, including providing humanitarian relief during global crises.
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A graduate of the University of Ottawa’s Common Law program, Mr. Rovinescu is an inspiration to our students and our alumni.
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It is an honour to welcome Calin Rovinescu back to the University of Ottawa. He demonstrates that with vision, determination and higher education, one can truly defy the conventional.
www.uOttawa.ca
BEST OTTAWA BUSINESS 2015 RECIPIENTS established security industry. Over the past year, the team has grown from 15 to 22. Solink has established a sales office in Maryland to pursue the lucrative U.S. market and added a second offering, Solink 4.0, that supports secure public cloud deployments. End users and security integrators are taking notice. Revenues for the current fiscal year are expected to be up by 30 to 50 per cent from last year. The company has the continued financial support of Wesley Clover as it works to achieve positive cash flow.
The Better Software Company Serial entrepreneur Steve Cody created The Better Software Company in August 2014 for one reason: “To create a software that was both simple to use and incorporated all the essential functions of running a business into a single software package.” Like many startup stories, the idea for Better Software arose out of
personal frustration. After experiencing firsthand the pains of managing multiple spreadsheets and business applications that were expensive and complex, Mr. Cody decided to develop a fully integrated solution for small business. The only challenge: While he understood business, he knew nothing about technology. With the help of Laurie Davis, founder of the Capital Angel Network, and Kanata accelerator program L-Spark, Mr. Cody assembled the team he needed to turn his vision into reality. Better Software offers a fully integrated small business software-as-a-service solution. It integrates features such as customer relationship management, scheduling, billing and invoicing, reporting and analytics, and inventory management. Its platform aims to offer business owners the simplicity and ease of use that will save them time. The software is configured to service businesses in diverse vertical markets such as rentals, service, retail and e-commerce. With about $1 million in seed funding, Better Software expects to launch its service this fall. In just nine months, the company has grown from four to more than 30 employees.
Dominion City Brewing Co. Combine three friends, a passion for beer, seed funding from a Kickstarter campaign and a core group of 60 friends and family
fondly referred to as the City Councillors. The result is Dominion City Brewing Co., founded by Josh McJannett, Andrew Kent and Alex Monk when the trio were just in their 20s. Their vision? Craft-quality artisan beers that push the boundaries from a company that also supports the community. Dominion’s beers emphasize a connection with the people and the land that make them possible. Take, for example, its Terroir Series,
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anada’s national champions made the semifinals in the World Cup in South Africa recently.
in the real world that is scored on its innovation, social, environmental and economic impact, and sustainability as a self-sufficient enterprise.”
They weren’t competing on the soccer pitch, but in the field of social entrepreneurship.
Enactus uOttawa won the national competition with nine projects. It then went on to represent Canada in South Africa. Enactus funded their trip through a crowd-funding campaign that was supported by Telfer.
Enactus is a global not-for-profit dedicated to helping student, academic and business leaders make a better world, with a healthy dose of competitive spirit.
CigBins Cigarette butts are the most littered item on the planet. The CigBins team developed a new way to collect butts, secured a recycling deal to turn them into industrial plastics, and teamed with a local non-profit to create job opportunities for individuals with a
Canada Sports Officials is also looking to create a new league in Ottawa. For more information, please visit cso.enactusuottawa.ca
“Students get to apply the lessons they’re learning in the classroom in a very real way,” said Stephen Daze, faculty advisor and mentor for the Ottawa chapter. “Enactus links them to other business leaders and the community to solve real problems. They get to make a real difference and apply what they are learning, long before they graduate.” To learn more about Enactus uOttawa, please visit enactusuottawa.ca
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“This isn’t a business plan competition,” said Kathleen Kemp, former President of Enactus uOttawa. “It’s an opportunity to develop and implement a business or an initiative
Among those nine projects were two flagships that demonstrate how solving one problem creates the opportunity to tackle others.
Canada Sports Officials Students helped homeless people train to become certified as soccer referees and launched a microloan program for the purchase of referee kits. The Enactus team also created a corporate soccer league and is working with other leagues and tournaments, to provide work experience and employment opportunities.
Making a real difference Over the past four years, students have launched 11 initiatives through Enactus uOttawa, with the help and support of Telfer faculty. MONDAY, NOVEMBER 23, 2015
The team was made of up University of Ottawa Telfer School of Management students, who are part of the Enactus uOttawa chapter.
mental illness. For more on CigBins, please visit www.cigbins.com.
BEST OTTAWA BUSINESS 2015 RECIPIENTS small-batch beers crafted around a single locally sourced ingredient such as rolled oats, honey or pumpkin. The brewery works with local farmers and producers to showcase the best of the National Capital Region. The team has signed long-term contracts with local hops producers and works with partners including Savour Ottawa and other breweries to champion local agriculture that supports the beer-making industry. Dominion has had positive cash flow since it started operating in August 2014. Its list of “pouring partners” – local bars and restaurants that stock its product – has reached 50, while revenues have been growing an average of 15 per cent a month. The team has grown to 10 paid staff members, each of whom also get group health benefits, not to mention a quality supply of craft beer. They actively support local charities such as the Gloucester Emergency Food Cupboard, Operation Come Home and Ottawa’s theatre community.
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CanadaWheels
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Looking for a way to upgrade your ride’s style and performance? CanadaWheels is aiming to revolutionize the online shopping experience for the automotive parts and accessories industry. Its mission is to innovate, educate and give consumers transparency with an online catalogue of 500,000 products from 200 manufacturers. The company, which is run by a team led by founder and CEO Saleh Taebi, has already built up a base of thousands of clients through organic growth and is planning its entry into the U.S. market under the brand UsaWheels.com. In addition to what consumers expect of any online retailer, such as great customer service, free shipping and a hassle-free guarantee on every order, CanadaWheels uses technology and geolocation to ensure every customer gets exactly what they need. For example, CanadaWheels’ automated compatibility Ascertainment system collects aggregate data from multiple suppliers on vehicle compatibility and physical and load-bearing metrics. It then employs a statistical model to make product recommendations. Consumers can then be assured of the right tire match for their vehicles, for example, without a physical test for fit and performance. It then uses a cost reduction algorithm based on geolocation data to help find the lowest-cost supplier for a given product, while its Wheel Visualizer tool allows consumers to see what a set of wheels would actually look like on their vehicle.
Newsmaker of the year Shopify Ottawa’s e-commerce and all-around tech darling Shopify was big news with its initial public offering in 2015. The flurry of media headlines continued throughout the year as the company continued to cement its market-leading position. In fact, a Google News search for the period between Jan. 1 and Oct. 31 pulled up more than 305 pieces of original coverage on the company. Even Vancouver’s Hootsuite bathed in the glow of Shopify’s success. The West Coast firm’s CEO Ryan Holmes said the stellar IPO left him wondering if Hootsuite should accelerate its owns plans for a public listing. Not bad for a business that grew out of a struggling online snowboard store. In addition to the IPO, which has bagged Shopify the BoBs’ Finance Deal of the Year award, the company had plenty of other news to keep journalists scrambling. Over the course of the year, Shopify unveiled new tools and features for Pinterest, Facebook, Twitter and Uber. It expanded its offerings with its own credit card reader and shipping platform integrated with the United States Postal Service. And in a truly landmark deal in September, Shopify teamed up with Amazon. Shopify became the retailing giant’s preferred migration partner as Amazon announced its plans to shut down its Webstore e-commerce service for small businesses. The integration will also give Shopify merchants the ability to simultaneously list their products on their own storefronts and on Amazon.
Deals of the year FINANCE:
Shopify It was a watershed moment for a company regarded as a guiding light in Ottawa’s tech renaissance. In May,
e-commerce company Shopify raised $131 million in its initial public offering. According to the Globe and Mail, the offering was 30 times oversubscribed. About 7.7 million shares were sold for $17 each, up from an initial range of $12 to $14. The IPO price gave Shopify a market value of $1.27 billion. The stock has continued to trend up with a vengeance, reaching the $35 range in mid-November, for a valuation of more than $2 billion. The stock got a fresh boost in September, when online retail behemoth Amazon elected to join, rather than attempt to beat, Shopify. The two companies announced a partnership in which Amazon will facilitate the transfer of its e-commerce service merchant clients to Shopify’s platform. At a gathering of Ottawa’s business community in October, CEO Tobias Lütke said he sees a “massive opportunity” for Ottawa to build fantastic companies, and plans for “Shopify to see the next century.” Shopify was founded in 2006 to give small retailers a hassle-free platform on which to build a great e-commerce site. Today, merchants use Shopify to manage every aspect of their business, from products to orders to customers, selling online, in retail stores and on the go. There are 175,000 active Shopify stores around the globe, representing $10 billion worth of sales.
REAL ESTATE:
KRP Properties It was a big deal for Ottawa’s office market west of Moodie Drive, even if the key players were content to let it pass with little fanfare. In January, KRP Properties, the real estate arm of Sir Terry Matthews’s business holdings that runs the Kanata Research Park, expanded its portfolio. In a $69-million deal, it acquired seven office buildings – 411,000 square feet in total – from Colonnade Management. The deal gives KRP control of 50 per cent of Kanata’s total commercial market. “Although KRP is typically not an active buyer of real estate, we are always reviewing new opportunities to invest as they arise,” president Martin Vandewouw said in a local real estate newsletter. “Our board of directors favours local investment and favours assets that we are familiar with, so when the Kanata North Technology Park came to the market, we decided to take a serious look.” KRP Properties owns and manages more than 500 acres of land in Ottawa’s west end, housing two business parks with about 2.8 million square feet of commercial office space in total. For KRP, the area remains a great choice
for small and growing businesses looking for more affordable options outside of the downtown core that give them the flexibility to grow. “We are able to provide a physical environment for outdoor activities, and professional members services with special member discounts,” Mr. Vandewouw added. “(These) are a major pull for many businesses’ staff in the area.”
RETAIL
Nordstrom Long one of the most recognized upscale retailers in the United States, Seattle-based fashion chain Nordstrom is in the midst of a six-store expansion into Canada. The second Canadian store opened in Ottawa last March to great fanfare, making it one of most anticipated openings the Rideau Centre has ever seen. The 157,000-square-foot location features natural light, wood finishes and other elements Nordstrom hopes make the store inviting and easy to navigate for shoppers. Nordstrom’s arrival is expected to raise the bar in Ottawa’s retail scene with more than just its fashionable inventory. “Nordstrom walks their own talk,” Ian Lee, an assistant professor of business strategy at Carleton University’s Sprott School of Business, told OBJ in April. “If they didn’t invent superior customer service, then by God, they certainly were the people that refined it.” Customer perks include in-store alterations and shoeshines as well as a complimentary wardrobe and shopping service. Nordstrom is bringing a new dimension to fashion retail, just as Whole Foods did in the supermarket business, added Barry Nabatian, director of market research at Shore Tanner & Associates. With Holt Renfrew now gone from the local scene, shoppers looking for top designer brands in the capital don’t have many other options. Smaller boutique businesses in town that cater to an upscale clientele might suffer at first, Mr. Nabatian said, but the presence of a major anchor like Nordstrom might benefit them over time by driving the market for high-end shopping in Ottawa.
TECHNOLOGY
Gigataur Hitching your brand to a global phenomenon like the Star Wars franchise is the dream of any startup. Disney
BEST OTTAWA BUSINESS 2015 RECIPIENTS certainly wouldn’t be a bad second choice. In March, Ottawa gaming company Gigataur (formerly Glitchsoft) nailed both, launching with Disney a new game, Star Wars Rebels: Recon Missions. Gigataur CEO Andrew Fisher said it was a testament to his team that the company has advanced to the point where it can partner with “the biggest entertainment brand” in the world. Work on the Star Wars project began in September 2013. By the time the game was released, Gigataur had tripled in size to 30 employees. This is not a one-shot deal. Gigataur expects to update content in the game over the next year or two. The Disney partnership will also open doors to new opportunities to go along with other projects already underway. Making the cut with “triple-A brand partners” (a list that also includes Lucasfilm and Marvel), heralded the need for the name change. While the name Glitchsoft was considered edgy and contrary to the mainstream when it was chosen in 2009, it proved to have a negative connotation. Gigataur, on the other hand, combines elements of words that convey creativity and power, Mr. Fisher said.
#NextBig Thing PageCloud Back in January, PageCloud founder Craig Fitzpatrick made a bold prediction about his startup – a growth trajectory on par with Shopify. What makes PageCloud so special? A platform that makes building websites as easy as dragging and dropping. Users can add photos, text, videos and other elements to web pages using drag-and-drop movements and keyboard shortcuts. The idea isn’t a new one. In fact, Mr. Fitzpatrick used to squeeze some degree of that functionality out of Apple’s nowdefunct iWeb application. But it’s a nut that had never been fully cracked. “The building of websites has always been the domain of developers, and for all of their skills, developers aren’t always the
best designers,” he told OBJ. “That was my frustration for years, and I just assumed that someone else will solve it ... and 10 years later, nobody solved it.” After pounding out the code for PageCloud and assembling the core team, Mr. Fitzpatrick, along with vice-president of business development Greg Evans, headed down to Silicon Valley in September 2014 to trot out the concept. They came back with a US$1-million investment round. That was followed by a second $1-million round in January. Local investors include Tobias Lütke of Shopify, Frédéric Boulanger of Macadamian and Peter Sandiford, founder of LPI Level Platforms and Netstone Technologies. The team is currently working toward a full platform launch this fall.
Punchtime A couple of years ago, Yves Eggleston, co-founder of local property developer Blueprint Builds, came to software developer Christian Desjardins with a problem. Collecting accurate time sheet
information from staff in an efficient manner was a nightmare. An associated construction firm reported that three of its staff were wasting a total of about 40 hours a month wrestling with the same issues. Soon after, Punchtime was born. Mr. Eggleston was so impressed by the app Mr. Desjardins created for him that he became an investor and partner to help commercialize it. The app makes it easy for employees or contractors to punch on and off the clock with their mobile device. It includes secure time and location data that gives everyone confidence that the hours worked are accurate and fair. Punchtime plugs into whatever backoffice and accounting software a business might be using and updates these systems automatically. Gone are the days of chasing down physical time sheets and entering data manually. For Mr. Desjardins, Punchtime is also a tool for collecting and visualizing data that can enlighten employees, the HR department and management alike. “You can understand where staff are focusing their activities, who has experience with what project or situation – quantify all your human assets to know who is doing what and what competencies they have developed,” he said.
MONDAY, NOVEMBER 23, 2015
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Interested in finding out more? Contact terry@greatriver.ca or 613-238-1818 x. 268
FOR THE RECORD Contracts
Hats off
reflected radiation Buyer: DND $3,500,000
The following contains information about recent contracts, standing offers and supply arrangements awarded to local firms.
The Canadian Internet Registration Authority was recognized as two of Aon Hewitt’s best small and medium-sized employers in Canada for 2016. Recognition is given based on an analysis of employee, leader and human resource practices surveys submitted by participating organizations.
The VCAN Group Inc. 275 Slater St. Description: Learning services to support MPMCT training and performance support services Buyer: DND $1,142,078
Bell Canada 160 Elgin St. Description: ITQ – SSC government cabling services Buyer: Shared Services Canada $170,008,500 S.i. Systems Ltd. 170 Laurier Ave. W. Description: IT professional services Buyer: PWGSC $6,357,819
Miskumi Technologies Inc. 134 St. Paul St. Description: Camera, CCTV, low light level application Buyer: PWGSC $1,052,631
S.i. Systems Ltd. 170 Laurier Ave. W. Description: IT professional services Buyer: PWGSC $5,463,355
Marcomm Systems Group Inc. 29 Antares Dr. Description: Camera, CCTV, low light level application Buyer: PWGSC $1,052,631
Michanie Construction Inc. 2825 Sheffield Rd. Description: Expansion of training centre Buyer: PWGSC $5,273,000
Honeywell Ltd. 400 Maple Grove Rd. Description: Camera, CCTV, low light level application PWGSC PWGSC $1,052,631
Deloitte Inc. 100 Queen St. Description: Human resources services, business consulting/ change management; project management services Buyer: Employment and Social Development Canada $3,794,175
Hitachi Data Systems Inc. 350 Albert St. Description: Camera, CCTV, low light level application PWGSC PWGSC $1,052,631
M&P Tactical Operational Support Services Inc. 120 Iber Rd. Description: Night vision equipment, emitted and
Genesis Integration Inc. 22 Gurdwara Rd. Description: Camera, CCTV, low
light level application PWGSC PWGSC $1,052,631 Acme Future Security Controls Inc. 2170 Thurston Dr. Description: Camera, CCTV, low light level application PWGSC PWGSC $1,052,631 Com-Net (Communication Cabling and Network Solutions) Inc. 1001 Thomas Spratt Pl. Description: Camera, CCTV, low light level application PWGSC PWGSC $1,052,631
Klipfolio was recognized with a Companies to Watch award as part of Deloitte’s Technology Fast 50 Awards. The awards honour early-stage Canadian technology companies and are selected based on the potential companies show for future growth. Beau’s All Natural Brewing Co. has received four recent distinctions of excellence, including two entrepreneurial awards and the Entrepreneur of the Year award from the United Counties of Prescott and Russell. Beau’s was also honoured by the National Organic Craft Beer Competition for its products Lug-Tread and Märzen. OPIN Software has won Acquia’s 2015 Partner Site of the Year Award in the
federal public sector category for its work on the prime minister’s website. The award showcases the best examples of digital innovation from Acquia partners. BTI Systems has been recognized by this year’s Fierce Innovation Awards: Telecom Edition as a second-year winner in the competitive Data Center category. The awards program evaluates submissions based on technology innovation, financial impact, market validation, ability to integrate into existing network environments and enduser customer experience. Algonquin College past president Robert Gillett has received a lifetime achievement award from the Ministry of Training, Colleges and Universities. He was Algonquin College president for 16 of his 45 years in education. Benoît Lessard of the University of Ottawa’s faculty of engineering has been awarded a John Charles Polanyi prize for research that may lead to smart, “organic” electronics, better violence prevention and new molecular imaging agents to detect disease. The awards are funded by the province of Ontario.
Chubb Edwards 8 Hearst Way Description: Camera, CCTV, low light level application PWGSC PWGSC $1,052,631
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“Sweet Memories Baskets and Favours is a social enterprise of Y’s Owl Maclure Co-operative Centre that provides a greater range of employment opportunities for individuals with disabilities.”
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HUH? E eINadvantaOTgesTAto locaWl A, MTherAD manufacturing som e are
CONNECTING TECH
IN OTTAWA
VOL. 1, ISSUE 3
MADE IN OTTAWA, HUH? There are some advantages to local manufacturing
MONDAY, NOVEMBER 23, 2015
FAST HARD ANDKanat a’s L-Spark New cohort in hits the accelerator PAGE 3
TED SUPER CONNEC s will change everything, Internet of Thing PAGE 4 says Carleton research chair
L THE REAL DEA shares the straight dope App developer on getting cash PAGE 9
PHOTO BY MARK HOLLERON
CONNECTING TECH IN OTTAWA
VOL. 1, ISSUE 3
MONDAY, NOVEMBER 23, 2015
HARD AND FAST
New cohort in Kanata’s L-Spark hits the accelerator PAGE 3
SUPER CONNECTED
Internet of Things will change everything, says Carleton research chair PAGE 4
THE REAL DEAL
App developer shares the straight dope on getting cash PAGE 9
PHOTO BY MARK HOLLERON
“If you’re changing the world, you’re working on important things. You’re excited to get up in the morning.” – LARRY PAGE, CEO OF GOOGLE
Crank Software Inc.: Brian Edmond, President; Thomas Fletcher, VP, R&D; Jennie Lundrigan, Marketing Communications Manager; Jason Clarke, VP, Sales & Marketing MNP: Gavin Miranda, Taxation Services Partner; Ryan Pinet, Assurance Services Senior Manager
Partners in Growth, Allies in Innovation
MONDAY, NOVEMBER 23, 2015
As a cutting-edge business, you need growth strategies that are as innovative as you are. MNP has the expertise, knowledge and people to help you plan ahead while taking advantage of grants, tax credits and market know-how, right now. As the fastest-growing national accounting and business consulting firm in Canada, MNP has the same entrepreneurial spirit and mindset as you do. And when it comes to opportunities for technology, we help you create the future.
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Contact Gavin Miranda, CPA, CA, at 613.691.4224 or gavin.miranda@mnp.ca
SYSTEM UPDATE
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BRACE FOR ACCELERATION BY CRAIG LORD
L-Spark, the Kanata-based incubator that is a partnership between Wesley Clover and Invest Ottawa, continues to churn out promising startups. The program includes an incubator for newer companies and an accelerator for more advanced companies. Below, we check out the new cohort in the L-Spark accelerator.
CAREERLAUNCH “We want to hit this market hard and fast.”
CLINICONEX
“They force you to not just become an entrepreneur, but to become CEOs.”
ANTHONY MAR, FOUNDER OF CLINICONEX. PHOTO BY MARK HOLLERON
Anthony Mar is no stranger to the L-Spark program. Cliniconex, a SaaS company that helps doctors’ offices save money on missed and rescheduled appointments, was a product of the incubator. “As the deadline to apply was approaching, I started thinking about the contribution [L-Spark] made to the company in the incubator,” Mar says. Cliniconex recently missed out on a first round of funding. Prospective investors said missed metrics were to blame. Nonetheless, the progress the company experienced made applying for the accelerator an easy decision. “We were really close to raising a round. That was because of L-Spark,” Mar says. If that’s what the program can do in a few month, he adds, the nine-month accelerator program will yield even greater results. It was a natural transition, too, from the incubator to the accelerator. Mar says the two-dozen pitches he has done in the past few months made the successful application to the accelerator possible. “I needed the incubator to get into the accelerator,” he says. Living up to its name, Mar says the accelerator has made everything in the company move at a faster rate. “We have higher expectations now of ourselves to accomplish things,” he says. “Having to execute even faster. Having to get deals done faster. Having to raise money earlier.” But that’s the kind of environment Mar
Making a return to L-Spark is ZINation founder David Ker, who found initial success in the incubator cohort. ZINation provides software for merchants to generate automatic catalogues and lookbooks for their wares. It’s integrated with Shopify and Magento e-commerce says the cohort needs. The accelerator is platforms. The software strives for a teaching the cohort how to be the CEOs of sleek viewing experience for customers, fast-growing companies. integrating product details into a catalogue “L-Spark gives entrepreneurs a way to in just two clicks. Making them “shoppable” transition from being ‘that tech guy’ to being is the ultimate goal, Ker says. CEO. And that’s really crucial.” The pre- and post-L-Spark versions of ZINation are clearly delineated in Ker’s mind. “Before L-Spark, we were a bunch of FILE FACETS entrepreneurs, but we were a bit naïve … The incubator was to make us fundable, now “You almost can’t help we need to raise the money.”
but succeed.”
You’ll be forgiven if you don’t understand the inner workings of “information governance,” also known as IG. File Facets is there to do it for you, and save your company money while it does. To make it simple, the objective of File Facets is to clean up the “dark data,” the files without proper metadata or retention schedules, saved and forgotten on shared drives or some other dusty digital shelf in the recesses of your company’s servers. Clearing out and organizing redundant, obsolete, trivial files (ROT), can save businesses $5,000 per terabyte, says File Facets founder Chris Perram. File Facets, the software company, began in January. But Perram has been building towards this stage for years as an IG consultant for the federal government. It wasn’t until a customer asked him about implementing the technology into shared drives that the concept for the software-asa-service was born. “There’s nothing in File Facets that isn’t
The L-Spark program doesn’t take it easy on the cohort, suffice to say. Expectations around monthly recurring revenues (MRR) and five-year plans are paramount in the program. Demanding as it may be, Ker was excited to reapply for a chance at that kind of environment through the accelerator program. “You’re going into a process of creating a smarter business. More data-driven. More customer-focused,” he says. “They force you to not just become an entrepreneur, but to become CEOs.” One recurring theme from the incubator cohort was a sense of community forming around the L-Spark companies and mentors. Ker says he can already feel the same connections beginning to form. “It’s still early, but it’s a similar environment. I see the same level of cooperation … The L-Spark team is awesome.” Early results from L-Spark’s second accelerator cohort indicate agreement on that point.
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“Having to execute even faster. Having to get deals done faster. Having to raise money earlier.”
ZINATION
MONDAY, NOVEMBER 23, 2015
If you get a job straight out of college or university in the next few years, it might be thanks to Jeffrey Doucet. He’s the founder of the company that bills itself as the first job search management platform, CareerLaunch. It began as an app called “Quick Hire,” aimed at helping employers recruit for entry-level positions. Then it evolved into a platform to help post-secondary students organize their job searches. “We realized we weren’t solving the problem we were hoping to solve,” says Doucet, noting they were really looking to help students get hired out of school. His team then designed a course to provide students with the skills to get a job. CareerLaunch is the software that came out of that. It was designed to mimic that process. The product is made available through licensed post-secondary institutions. It organizes applications, sends notifications of next steps, and provides learning materials to students. “It makes the job seeker much more effective,” Doucet says. The Toronto-based company was at a crossroads a few months ago, after it locked down an initial partnership with Ryerson University. It could have grown slowly and focused on pre-existing customers, or it could aim at an enormous international market of job seekers. “For us, growing slowly wasn’t an option we were excited about. We want to hit this market hard and fast.” That need drove Doucet and co-founder Tristan Toye to L-Spark. Though just a few weeks into the program, the mentorship available through the accelerator has made an immediate impact on CareerLaunch’s trajectory. “A lot of the value is in the people who walk through the door,” Doucet says. CareerLaunch launches with partner schools in Ontario in just a few weeks time.
client-driven from real-life projects,” says Perram. In September, File Facets won the IG Technology Provider of the Year award from the Information Governance Initiative, beating out heavy-hitters in the field like OpenText and Hewlett-Packard. In coming to L-Spark, File Facets is learning everything there is to know about being a software company from the best in the Ottawa ecosystem. “At the core of what they provide us, in terms of support, is incredible mentorship,” Perram says. The environment has been so beneficial to Perram already that he has moved from his office in Kanata to work directly out of L-Spark at all times. “If I’m going to squeeze everything I can out of L-Spark, I need to be here.” Perram says the principles of discipline and accountability that come with working in the accelerator have been the biggest impacts on his daily work. “I am laser-focussed on my next nine months,” he says. “You almost can’t help but succeed.”
“I think as a company, if you can get those two things right — having a clear direction on what you are trying to do and bringing in great people who can execute on the stuff — then you can do pretty well.” – MARK ZUCKERBERG, CEO OF FACEBOOK
TECH 101: INTERNET OF THINGS New research chair in sensory technology named at Carleton U BY STEPHEN KARMAZYN
MONDAY, NOVEMBER 23, 2015
Ottawa is getting smarter, at least in the technical sense. The Internet of Things, which is to say the connectivity between devices in everything from wearables that measure heart rates to cars that selfassess, is going to be big. “The Internet of Things will allow us to see our world and to make our world
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LEFT TO RIGHT: CISCO CANADA PRESIDENT BERNADETTE WIGHTMAN, DR. MOHAMED IBNKAHLA AND ROSEANN RUNTE, PRESIDENT OF CARLETON.
smarter. It will transform the way we live,” Mohamed Ibnkahla told those gathered for his appointment to the new Research Chair in Sensor Technology for the Internet of Thing at Carleton University. This is another in the long string of IoT focused investment of human capital and, well, regular capital. IoT is taking over everything from energy
consumption and water control to garbage collection and snow removal, he said. Ibnkahla went so far as to say that the “whole concept of city governments … will completely change with the Internet of Things.” Cisco Canada president Bernadette Wightman, who partnered with Carleton in the announcement of this new chair,
says, “We may already think we live in a hyperconnected world, but one per cent of the things that can be connected are connected.” That means there is plenty of room for growth. A recent Cisco study determined the IoT will drive $14.3 trillion of net value globally over the next decade with $400 billion of that coming in Canada alone.
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We need to have a sense of urgency. Every sector of the economy is going to be disrupted by this … new connected phenomena that connects people, processes and machines. Don’t think it’s not going to happen to you. This is a conversation that Canadian business needs to have that they’re not having. — JAMES MAYNARD,PRESIDENT AND CEO, WAVEFRONT
“The Internet of Things has the opportunity to transform every single industry, every business, every city and every country,” Wightman said. “The path to digitization is hugely reliant on research and innovation, precisely the type of research and innovation that (Dr. Ibnkahla) is doing. Canada has an opportunity to lead and take a key role in digital disruption and creating a thriving environment that will benefit all Canadians.” IoT dominance is coming. The choices are to be prepared or get out of the way. James Maynard, president and CEO of Vancouver-based Wavefront, is dedicated to accelerating Canada’s wireless innovation. The institution
works with more than 30 companies and its mandate is to grow Canada by $400 million in GDP, 6,000 in new jobs and a 150 new companies in the first five years. They’re on pace to achieve that. “In the last five years, there’s been a tremendous shift in the price performance and availability in technology, to the point now where it’s almost free,” says Maynard. “The major shift with the Internet of Things, is the shift in the role of IT in enterprise. This is the first time where I’ve seen technology platforms have become offensive strategic weapons for businesses to grow.” Maynard says if you’re still trying to figure out how to get online and mobile, you’re two years behind.
“Mobile devices have overtaken traditional web terminals. The mobile user is king and the next thing is to connect them to their world.” IoT is part of the “intellectual insight” that helps businesses grow, streamline and modernize. “It’s really the next phase of bigger integrated platform of cloud, data analytics, big data and mobility,” says Maynard. “We need to have a sense of urgency. Every sector of the economy is going to be disrupted by this … new connected phenomena that connects people, processes and machines. Don’t think it’s not going to happen to you. This is a conversation that Canadian business needs to have that they’re not having.”
UNDERSTANDING THE INTERNET OF THINGS
It’s been around for just about 30 years, and used to be called machine-to-machine communication. And the long and short of it is IoT is here to save you “million and millions of dollars” if used right, says Alan Swain, VP at Wavefront. He mentions self-reporting analytics that will tell you when something needs servicing versus having an arbitrary service date is a great way for companies to shave operation costs with needless check-ups. Another area is health. The newly opened Humber River Hospital, for instance, is the first fully digitally integrated hospital in North America. Which is to say IoT isn’t risk free. Swain warns of security threats from hackers getting into, say, a selfupdating pacemaker and futzing with it, but the best way to ward of those worries is to be prepared.
ALAN SWAIN
VICE-PRESIDENT, WAVEFRONT
MONDAY, NOVEMBER 23, 2015
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“If it keeps up, man will atrophy all his limbs but the push-button finger.” — FRANK LLOYD WRIGHT
MADE IN OTTAWA, NO KIDDING? There are advantages to manufacturing at home, says CEO BY STEPHEN KARMAZYN
‘Made in Ottawa’ isn’t the tag you see on a lot of tech products, but a quick walkthrough of Powerstick.com’s office might change your mind. “Coming in here every day is like coming into Santa’s Workshop,” says Nigel Harris, founder and CEO of Powerstick.com. Centered around branding and building cool tech tools, Powerstick.com is best known for its eponymous product, the Powerstick. Part portable phone charger and part USB storage, the device sees use everywhere from folks in the office to U.S. Military soldiers in the field. Powerstick.com’s newest device is the Mosaic, a WI-FI accessible hard drive that allows multiple users to connect and
Université d’Ottawa
NIGEL HARRIS
FOUNDER AND CEO, POWERSTICK.COM
stream content from a single device. Mosaic launches on Amazon Nov. 25. Both products, like all of Powerstick. com’s goods, are assembled by hand onsite. “Our customers expect longevity, quality in our company and our products,” Harris said. “Manufacturing here, we have
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a much better chance of standing behind (the products) and replacing them if they do become defective, which importers have great difficulty with if they’re having their products manufactured overseas with limited production runs.” Quality assurance is also a huge bonus that comes along with the “Made in Ottawa” sticker. As CEO, Harris can walk a few metres down the hall from his office and oversee the entire production process. In a world where competitive wages and taxes have sent most manufacturing jobs to Asia, Powerstick.com proves a unique case of keeping those jobs – and capital – right here in the Ottawa economy. “People say, ‘How can you afford to do it Canada? Shouldn’t you do it in China?’” Harris said. “They don’t really understand all the component issues, the sourcing issues, the problems with quality … that you have with overseas imports.” To be fair, Powerstick.com isn’t producing millions of products to store on mass retailer shelves. But there’s a number of huge
University of Ottawa
A VACCINE FOR ALL INDIGENOUS WOMEN Jessie Nault is drawing on her heritage and her personal experience to combat the high incidence of cervical cancer among Indigenous women.
MONDAY, NOVEMBER 23, 2015
One day, all young Indigenous women in Canada will be vaccinated against the human papilloma virus (HPV) that causes cervical cancer. And this will save many lives. This goal is certainly ambitious, but at 26, Jessie, a medical student and researcher at uOttawa, is certainly not lacking the ambition to tackle this issue head-on.
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The scholarships she receives from the University allow her to focus full time on her studies and research. To learn more about how Jessie is defying the conventional, visit http://www.uottawa.ca/give/JessieNault.
Defy the Conventional: The Campaign for uOttawa
benefits to building in Ottawa, Harris said. Being NAFTA compliant, for instance, allows the company to avoid tariffs. Another is that markets that would otherwise be closed off to products produced in Asia – like Canadian labour unions and the US Military – Powerstick.com can freely access. Powertick.com counts as clients some heavy hitters, including Bank of America, Reuters, Ford Motor Company and Google just to name a few. Mr. Robot, the USA network show taking the world by storm, has bought branded Mosaics with the second season pre-loaded for promotional and review purposes. “The labour force here in Ottawa is very well trained,” Harris said, “it’s very technical. A lot of our people come from the Nortel/ Newbridge environment. They’re very skilled and it’s very easy to get the manpower we need. “It’s very profitable, but it’s also an incredible amount of fun designing a products that everyone regards as cool tech toys.”
TECH-FLIX
Updated local and national video posted weekdays at techopia.ca
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ear-over-year revenue growth of over 400 per cent. A $12.5-million series D round of venture capital. A 100 per cent jump in staff. With numbers like that, it should come as no surprise that CENX is staking a claim in a market space ripe with opportunity. Capitalizing on it takes the CENX team across borders on a regular basis. With its secret sauce steeped in proprietary intellectual property, the company needs a legal team with the expertise and contacts to serve its interests around the globe. “You always have to look at what you are doing here today in Ottawa and extend those considerations to what is happening in all those other jurisdictions where you operate,” said CFO Kim Butler. While CENX is still based in the U.S., the bulk of its operations are located with the senior management team in Ottawa under CEO Ed Ogonek. The company is in the fast-growing lifecycle service orchestration (LSO) market. Building on Ottawa’s hotbed of tech talent CENX helps mobile, wireline and cloud data service providers manage reams of big data to provide more reliable services more quickly to their customers.
“Ottawa remains a hotbed of technology talent for data
In three years, the CENX team has grown from 30 to more than 180 staff, with offices across the U.S. and overseas. Full-service law firm Perley-Robertson, Hill & McDougall has been a crucial partner at every step. “CENX is a great example of a fast-paced and growing tech company with a variety of legal needs that we are proud and honoured to support,” said Lorraine Mastersmith, a partner in the Business Law Group at PerleyRobertson. Her team has steered CENX through the complexities of cross-border financing, global intellectual property protection, commercial leasing and the myriad
of employment law issues inherent in the management of a rapidly growing workforce. Local expertise, global experience “We’ve needed to tap into a broad range of services as we’ve grown,” said Butler. “When we look to engage firms, we want someone who has the local contacts, understands our market and our business needs as a technology company, and can support us outside of Canada.”
around the globe,” Butler said. “That means we don’t have to deal with several lawyers in different time zones ourselves.” Partners who are on the same page It all comes down to partners who understand each other. “Our advice and support is strategically more effective when we understand what is going on in all aspects of a client’s business,” Mastersmith said.
This is particularly important when it comes to managing patents and trademark applications and registrations overseas. It’s a sensitive area that requires more than just routine business advice.
“It makes a big difference in our operations to work with a law firm that understands the cadence of our business, our management approach and how we deal with challenges,” Butler added.
“We have one contact point with Perley-Robertson here in Ottawa who facilitates and manages the relationship with trademark agents
To learn more about how PerleyRobertson, Hill & McDougall can help grow your business, visit www.perlaw.ca.
MONDAY, NOVEMBER 23, 2015
It does this by taking the rich pool of talent it finds in Ottawa for data and IP networking, and combining it with big data analytics, workflow automation and leading-edge visualization software.
and IP networking,” Butler said. “It only seemed logical to build out the team here with the caliber of people we find in the area.”
07 TECHOPIA.CA
“For a successful technology, reality must take precedence over public relations, for nature cannot be fooled.” — RICHARD P. FEYNMAN
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Legal tips for startups Tech startups have unique legal needs. A lawyer with experience in the tech world can be a valuable business asset and resource to help you create a solid framework from which to grow your business. Here are Perley-Robertson, Hill & McDougall LLP/s.r.l.’s top legal tips for startups:
1
MONDAY, NOVEMBER 23, 2015
KNOW WHAT YOU NEED AND CREATE BUDGET
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Legal advice does not have to be expensive. By educating yourself and clearly setting out what your legal needs are, getting quality and effective legal advice will be in your budget. Make sure your lawyer understands your business and what you plan on doing with it. If you have an exit strategy, share it with your lawyer. This information is invaluable to ensure you receive the advice you need.
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GET INCORPORATED
KEEP THE CAP TABLE SIMPLE
SIGN A FOUNDERS’ AGREEMENT
By incorporating you can easily split ownership in your startup among your founders and investors. You also protect your personal assets from liability.
If you plan on doing an angel or venture round of financing, your investors will want to see a clean, simple cap table. Complicated share structures are often tax driven and for a new startup with little revenue, not a top priority. Spend your money and time planning elsewhere and keep it simple.
A shareholders’ agreement helps co-founders plan for the worst. If the working relationship breaks down between shareholders running a company, the shareholders’ agreement sets out the steps necessary to end the working relationship amicably without the expense and hassle of negotiation or litigation.
5 VEST EQUITY OVER TIME Vesting ownership over time is a fair way to make sure the people who put their time and energy into growing your startup reap the rewards of that growth.
If you’re a startup that needs legal advice, contact Conor Cronin at Perley’s Business Law Group. He can be reached at ccronin@perlaw.ca.
WHAT’S HAPPENING Stay up to date with TECHOPIA’s calendar of events at techopia.ca
THE STRAIGHT DOPE Lessons in financing from an L-Spark grad Did you get any legal advice?
BY CRAIG LORD
Christian Desjardins, founder of Punchtime and L-Spark incubator grad, recently went through a second round of seed funding for his SaaS company. What lessons did he learn from his first round? Techopia got the scoop.
What was your strategy going into discussions? “We got a little bit lucky, I guess. In hindsight, I would say, I don’t know if I would’ve jumped on board so quickly. We gave up 20 per cent equity the first time around, which isn’t a whole lot, but it’s substantial. And then you have to deal with the realities of that relationship once you’re in it. It’s just like a relationship with a person. You don’t want to commit too quickly or blindly because then you might be in for some surprises. The second-time around, we were much more prudent and much less willing to give up equity easily. And we really got to know the people who wanted to work with us and wanted to invest in what we were doing.”
“Lawyers got in pretty much right away. The lawyer we had originally was not extremely well informed with these types of dealings. He was our guy for all of our basic corporate needs, that sort of thing. He wasn’t completely out of his league, he did review the paperwork and it was pretty much standard stuff for the most part but it was a strange deal. The first time we did it, it was an equity deal, but part of the deal felt a little bit like a loan, which we didn’t really like. Eventually we changed that and that was part of the complex relationship. Definitely get a lawyer, and try to get a lawyer that’s experienced, that’s done this before. If our first lawyer had done this many times, it would’ve raised more red flags that we felt like we found out maybe a little bit too late. They weren’t huge things, but they did bother us, and if we had known beforehand, we would’ve made decisions differently. People who have done a startup and have been through the whole process, those people are super helpful. Because along the way, they’ve met those people, they’ve
made those connections. Learn from their mistakes as opposed to having to make those mistakes yourself.”
How did you determine how much to ask for? “The first time we got funding, we didn’t have a really well-formulated, wellstructured ask. We knew that we wanted to hire a certain amount of human resources. We knew we needed to do certain other things that cost money like buy equipment, pay rent, that stuff. So we raised about $200,000. From the onset, I would say, make sure you know who’s paying for the accountant and the lawyer fees that facilitate the transaction. We ended up paying a whole lot of it, and it cost us a lot of money. All of that money could have gone to more appropriate applications if we had taken more time to negotiate.”
What advice would you give to someone looking for seed funding?
y e v r u S e c i o h C Employees’ ny forever! mpa o c r u o y e g n a h c It could
What’s the big takeaway? • •
• • •
“Get input from others. A lot of the advice that we got from L-Spark in the beginning,
Take the
it’s not that we discounted it, but we found some of it comical and we just didn’t get it. And then in hindsight, they were absolutely right. They are people who have done this before and they were right on the money. Get your pitch straight, have it super practiced, be critical about your pitch once you get a load of advice. It’s always more convincing if you can show a demo, something that works. Make sure you understand the financials of the startup. Projections are important. Know your investor. That’s a huge part of it. An Ottawa investor and someone from the Valley are completely different. Somebody from California, first of all, the money is much more. There’s a lot more competition, and they’re a lot more interested in big ideas than they are in MRR (monthly recurring revenue). In Ottawa, they want to see real growth, they want to see recurring revenue, they want to see a viable business. Something that’s been tried by real people that it was intended for and it works.”
•
Don’t jump in too quickly, take time to realize what you’re negotiating Shop around for affordable accountants and lawyers who have been through these negotiations Know who’s paying the bill for the legal work Find people who have been through it before and trust their advice Get your pitch straight and make sure you’re sharing something compelling Know your investor!
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AIt’s notTOUGH SLOG all fun and games inside social app startup Bumpn In the last print and digital issue of TECHOPIA, editor Stephen Karmazyn introduced readers to local social app startup Bumpn. In this issue, Karmazyn sits down with Bumpn co-founder Moe Abbas for a one-on-one to explore what it’s like to run a mobile app startup. Here is an edited transcript of that chat.
TECHOPIA: Take me through what it’s like to run a startup.
ABBAS: It’s hard. It takes a lot longer than you think it will. When we first started we thought we’d have a product out in the first three months and we’d get traction and everyone would pick it up. That’s not the reality. The reality is, it takes at least two years to see a semblance of success. Year one is a lot of pain. A lot of ups and downs. Mostly downs. A year and half into it you start understanding the market and where you fit in. I don’t think anybody can launch a company and immediately have product-market fit.
TECHOPIA: How can you tell if you’re on the right path?
ABBAS: You have a hypotheses: this is a good business, people want this thing. You have to go out and test it. Like all things that are tested, you’re going to be right to a certain degree and you’re going to be wrong on a lot of things and you’ve got to learn from that. It’s like a big science experiment; it’s very costly and requires a lot of smart people to get it right. Along the way, you learn more and more about the space and the more you learn the better the product you can make.
MONDAY, NOVEMBER 23, 2015
TECHOPIA: So what mistakes have you made?
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ABBAS: From getting the right co-founder to getting the right idea to capital requirements to building everything right in the company, we made so many mistakes. I would just count the first nine months as a total write-off other than an expensive learning experiment. If you’re doing a startup be prepared for at least two years of runway because that’s how long it’ll take you to figure your shit out. If after two years you don’t know, you should get a job. That’s the maximum range … you gotta figure your shit out. I don’t care if it’s in a brand new industry. It took three months to launch the first version of Bumpn. It failed. It was more about getting into the space, just move fast. But we learned from that and we did another iteration and another iteration.
TECHOPIA: Success always depends on people. Talk about the HR component of a startup.
ABBAS: We can’t have anyone in the company who isn’t an A or higher player. Even if it’s your co-founder. Especially in engineering. In a tech startup, if you don’t have phenomenal engineers, when you start, you’re going to be in trouble. You gotta be prepared to put everything aside and completely, obsessively immerse yourself. You need to be thinking about it all the time. You need to have your whole team thinking about it all the time. You have to be willing to sacrifice a lot of things to do a startup. I had to shelve all my businesses. A million-dollars plus in opportunity costs in order to focus on Bumpn. Not only do you have this opportunity cost, you’re losing money. I burned $500,000 of my own money in the company and you don’t even know if you’re going to succeed.
MOE ABBAS, CO-FOUNDER OF BUMPN WITH HIS TEAM. PHOTO SUPPLIED
It’s scary. It’s terrifying. Everyday you gotta wake up sick. Because if you’re not waking up sick, you’re not feeling it. At the same time you need to understand you can’t be living in an emotional state, you can’t run the company in an emotional state. As long as you’re building a great product that people love, you should be able to succeed. If you have a small niche of people who love your product, that’s more important than a lot of people liking your product.
TECHOPIA: How do you measure your success? ABBAS: Inside you gotta be questioning everything. You gotta be harsh critic. We’ve changed parts of the application that people love, because it just didn’t work. It wasn’t getting us toward our key business metric. What defines success for you product? For us, it’s daily active users. Ulitmately, everything you do, you have to ask this one question. How does it get us daily active users? If you can’t answer that question, even though it’s brilliant and amazing, you gotta scrap that. You need to focus on driving that business metric.
TECHOPIA: Is the co-founder no longer with the company?
ABBAS: A lot of great companies, they lose a key member. You realize along the way they’re not really the right fit for your organization.
TECHOPIA: Is there a story behind that? ABBAS: His engineering chops were not up to par. Number two, there was there was negativity. He’s a decent guy, but I don’t like the way he left. We were running low on cash at the time. The product kept getting delayed and kept having bugs. We hired another engineer whose engineering work was better than the cofounder. I had to ask him to leave. And I was only able to do that when I was comfortable in the space. That was back in 1.0. You really gotta make hard decisions, especially when it involves people. We had to release all the fat, bring it down to a small core group of really talented people. What happens is you end up doing things faster.
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CONNECTING TECH
IN OTTAWA
VOL. 1, ISSUE 3
MADE IN OTTAWA, HUH? There are some advantages to local manufacturing
MONDAY, NOVEMBER 23, 2015
FAST HARD ANDKanat a’s L-Spark New cohort in hits the accelerator PAGE 3
TED SUPER CONNEC s will change everything, Internet of Thing PAGE 4 says Carleton research chair
L THE REAL DEA shares the straight dope App developer on getting cash PAGE 9
PHOTO BY MARK HOLLERON
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