How Canadian entrepreneurs are competing on the global stage
The term “Silicon Valley North” is often referenced when discussing the rise of tech startups and entrepreneurs in Canada. I think it’s an overused term and not one I like to use when talking about Canadian entrepreneurship. To me, it implies that we’re not a country of creators and innovators. This couldn’t be further from the truth as evidenced from the calibre of entrepreneur-led companies on this year’s TSX30TM.
Canada ranked 14 on the World Economic Forum’s latest global competitiveness rankings; that’s down two points from 2018. As a country, we’re not known for being competitive, but the same cannot be said for Canadian companies, both those on the TSX30 and the more than one million small and medium sized enterprises that contribute to our economic output.
Having worked with entrepreneurs in all industries, I believe that entrepreneur-led companies are more competitive. They know how to bootstrap and work in economies that are difficult when larger companies may struggle in those conditions. In the end, the secret sauce behind these companies is about the entrepreneur themselves and their persistence, tenacity and vision.
Entrepreneur-led companies on TSX30 made the list because they are more nimble and persistent, are able to raise capital and execute on their vision. When looking at the trajectory of these companies, especially ones that started first on TSX Venture Exchange, it’s clear how important it is to provide entrepreneurs access to capital through public markets, and to support the growth of their company at all stages from start-up to publicly listed entity.
Addressing barriers to competitiveness
Small businesses are important to the prosperity of the Canadian economy. But in order for these businesses to expand, export, and compete globally, we need the right policies in place that go beyond monetary policies. This includes policies related to investments, incentives, productivity, and sustainability as a nation. However, the growth of these companies along the continuum—from startup to later stage to public company—is not possible without addressing access to capital.
Almost a decade ago, we hit a cliff when it came to the ability of entrepreneurs to raise capital. This led to many entrepreneurs leaving Canada to find investment dollars, source talent and grow their business. This brain drain ultimately impacted our competitiveness, but we have started to see the trend reverse in the last few years.
I believe what we have to do now is focus on helping these entrepreneurs to compete, grow and eventually excel, not just in Canada but also globally. This means removing hurdles through policy, investment capital, ability to access markets, and getting their business launched here on TSXV, then graduate to TSX and into other exchanges.
Transitioning from entrepreneur to business leader
Many founders find it challenging to go from being technical experts to business leaders, from having to do everything yourself to relying on others. That transition from entrepreneur to the CEO of a professionally led organization can be a difficult one, but there are two entrepreneurs on TSX30 that I believe have done this well: Tobi Lütke of Shopify and Ajay Virmani of Cargojet (for full disclosure, I serve on Cargojet’s board of directors).
Based on my observations in a lifetime spent working with entrepreneurs, the ones that want to become successful CEOs surround themselves with talent that amplify their skills, provide support where it is needed, and who believe deeply in and can execute the entrepreneur’s vision for the company. When these three things come together, you’ll find the secret sauce to a successful company that can compete both at home and globally.
TSX30 is a ranking of the 30 top-performing stocks on TSX based on 3-year dividend-adjusted share price performance. See the full rankings and methodology at tsx.com/tsx30.
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