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Waterloo’s Competitive Advantage for Incubating Startup Communities in Canada

Jonathan Ortmans, President, Public Forum Institute

When the Global Entrepreneurship Congress convenes in Liverpool next week, one of the largest delegations will come from Canada. A few weeks ago, I had the opportunity to tour one of Canada’s best startup cities—Waterloo—which offered some useful insights for the global entrepreneurship community.

Much like other innovation hubs, the genesis of this one is a university, the University of Waterloo, where an inventor-owned intellectual property policy has been a catalyst in the success of the city’s entrepreneurship ecosystem. Contrary to the lack of freedom at U.S. universities where commercialization is centralized in technology transfer offices, Canadian universities do not have major guidelines in this regard. Dubbed by many as "the most liberal intellectual property policy of anywhere in the world,” this policy has clearly helped Waterloo attract world-class researchers, and with innovators retaining ownership of their inventions, more entrepreneurs to commercialize them.

The evening I arrived, I was invited to address a large group of students and share some insights for nascent entrepreneurs. From the questions and discussion that followed, it was me who was doing the learning. This particular group was from the University´s startup dorm called Velocity. They were global, driven, confident and as networked and sophisticated as any Stanford or MIT group. I toured their dorm the following day—something they manage and run even to the point of hacking the TV to provide central data as to the availability of washers and dryers in the basement. In short it was a classic example of what can happen when there is not a penalty for unleashing your idea while on university grounds. It is a great testimony to the fact that universities can do much more than offer entrepreneurship courses to make them smarter incubators of entrepreneurial talent. It shows how universities can become central pillars in the emergence of new local startup communities—not institutions to be bypassed. If you are worried about university revenues, just drive around campus and ask who paid for what building. Entrepreneurs give back.

In the morning, I took a tour of the Communitech Hub, an awesome community of tech startups, students and researchers housed in a renovated 19th century tannery. Beyond actually seeing the technology at work, I was impressed with the exceptional array of rock star guest speakers brought in by their “dangerous event diva.” I saw a few of the faces I had seen the night before already embedding themselves at the hub. If you ever go to Waterloo, Communitech is a required visit for anyone excited by startups.

Later that same day I drove up the street to see what happens to other entrepreneurs who stay in town and try to scale. In Waterloo, the link between the university and industry has been strengthened by the Accelerator Centre (AC), funded by Federal and Provincial Governments, Ontario Centres of Excellence, the Regional Municipality of Waterloo, the City of Waterloo and the University of Waterloo. In its five years of operation, this accelerator has become a world-renowned center for innovation. As you walk out of the door, the industry park around you boasts dozens of growth firms all of whom emerged from this pipeline.

Waterloo is clearly a major source of economic growth for Canada, but also a useful test ground for the world as more policymakers examine how to help young talent accelerate the movement of innovations into the marketplace. In the U.S. for example, this is the subject of recent legislation. The Startup Act bill currently under consideration in Congress allows for grants to universities pursuing specific initiatives to improve commercialization capacity and to assist universities that want to pursue initiatives that allow faculty to approach technology transfer programs outside their institution of employment to commercialize research, among other initiatives.

In addition, Waterloo, as the home of Research In Motion (RIM)—the company behind the BlackBerry—will also be important to watch in the context of how startups can help breath dynamism into existing industries. A major intellectual and financial founder of Waterloo’s vibrant entrepreneurial community, RIM might do well to lean on some of its own community of disruptive thinkers as it takes on tougher challenges to its signature product line from the likes of the iPhone. It is this collection of new and young firm founders who can stop such giants from receding over time and keep their innovation cultures dynamic. The next five years for RIM will be as much a test for Waterloo’s vibrant entrepreneurial community as it is for its board of directors.

The Canadian delegation to the Global Entrepreneurship Congress—led by Canada’s entrepreneurial diva, Vivian Prokop—will have as much to share as it does to learn in Liverpool. Beyond Waterloo, there is plenty happening in Canada these days. For example, later this month Canada will launch its own privately-funded Startup Canada campaign to map the ecosystem and resources for startups across the country. Further 18 of the 68 selected early-stage entrepreneurs for the Start-Up Chile program are Canadian. We all look forward to more insights from Canada next week.

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