Startup Ecosystems

Montreal is probably the poorest but most thriving Canadian startup ecosystem.

Not that I’m trying to be controversial (yeah, right!), but let’s face it, Montreal might just be the best Startup Ecosystem out there. Yes, I’m even talking about you, Silicon Valley. No, we don’t have anywhere near the same amount of money that the Valley throws at startups or the huge network of investors, but we’re amazing at building things, and Montreal’s startup ecosystem itself is one of those things we built.

What is a “Montreal”?

Montreal is a beautiful city, filled with historical events like the “1611 Champlain’s fur trading post” and the “Saint Lawrence Seaway opening in 1959”. Its culture is also very diverse; people with different backgrounds, different religions, and different mindsets come together to make this town the perfect eclectic blend of cultures. Most of the people speak two to three languages (you know, the good ‘ol French-English dynamic), and embrace the town’s cosmopolitan aspect.

In a recent interview from Montréal Tourism, my mentor and good friend Sergio had this to say about the thriving ecosystem in Montreal;

It’s the French-English dynamic — we’re kind of in the middle here. We’re more conservative than English Canadians, but more aggressive and more “go-getters” than French people. I think that right now, that’s the big opportunity for Montréal. While we were building the startup ecosystem here, we noticed that balance between the two [cultural] systems has managed to create a kind of innovation, creativity, resilience, that you cannot find in other ecosystems.

-Sergio Escobar, Managing Director of Founder Institute’s Montreal Chapter.

And if you read that article, you saw that the Founder Institute (an accelerator based in Silicon Valley, mind you) found out that we, as Montrealers, are 7% more intelligent than Americans on average!

Now, before you act all high and mighty and get on you high horse…

Could our government do more?

Personally, I think the government is doing a good job, in general, to help startups. Yes, they did f*ck things up for us when they changed how they were applying their Scientific Research and Experimental Development Tax Incentive Program (SR&ED). It penalized startups more than anything, but compared to other Provinces, we get more money back from that program.

There’s also the Industrial Research Assistance Program (IRAP); they provide innovation and funding services to help accelerate the growth of businesses through innovation and technology.

And there are many more foundations and programs like Fondation Montréal Inc., where you can get mentoring, grants and (mostly) loans. Our city is a beautiful city because of that too. It cares about its startups.

A Made-in-Montreal Unicorn?

We’re not there yet, but Montreal exits are getting bigger. Take Lagoa for example, they sold to Autodesk for $60 Million. Then you have Stingray Digital Group Inc. with a $140M IPO.

However, when it comes to financing startups and raising money, Montreal is poorer than Toronto, Vancouver and pretty much any city in the US. As Sergio said;

It’s like we’re an “emerging Country”!

We’re doing what we can with very little funding from the government’s money.

What’s $5 Million to Canada and/or Quebec?

Let’s say they put together a $5M grant for tech entrepreneurs… 100 grants x $50k… boom! We have 100 startups that can start hiring, spend on services and build scalable businesses that will eventually hire 10s, 100s, 1000s of people. Think about the economic spinoffs for a city like Montreal?

They are giving $50M–$60M grants to mining companies with $100M–$300M roads, for easier access to the mines.

What’s a $5M grant for them? Nothing….

All from Montreal.

As we’re building Nukern, a billing Saas for web hosts of all sizes, we’ve met amazing entrepreneurs, mentors, Angels and VCs from Montreal. We managed to raise $265,000 from friends & family, BDC, SDEVM and Futurpreneur — also all from Montreal. I believe any startup can thrive in Montreal and grow exponentially fast. Not convinced? I talked about my experience as a Founder in Montreal’s Founder Institute Chapter in a previous post. But can you imagine, if only we had more money from our government, to whom we pay so much taxes? Montreal might as well be the next Valley!

What do you think?

I’d like to invite you to talk about your city ecosystem; whether you’re from Montreal, Vancouver or Dubai. Is it possible to produce “Unicorns” in your city? In your perspective, what’s missing in terms of funding-accessibility in your City? Could your local government do anything better to help entrepreneurs?

Philippe Rivard is the Founder & CEO of Nukern Inc., a cloud billing software for web hosts. You can reach him at phil [at] nukern.com.