It’s been a busy week. Planning season has arrived at Microsoft Canada, a [crazy] time when we step back, take a look ahead at the rest of 2009 and into 2010 and make some decisions as a company on our top priorities. One of them will undoubtedly be to continue to support software innovators across Canada, like the companies that were nominated for the Blue Sky and Ignite IT awards. It’s one of the most important and rewarding things we do.
The reason is simple. In some ways our economic troubles, like plant closures, are easy to see. Harder to grasp are the opportunities lost before they ever had a chance to be realized - the businesses that couldn’t be launched, and jobs that were never created. This is what’s at stake, and it’s why I firmly believe that technology should be a pillar of Canada’s economic recovery.
According to ITAC, our information and technology industry contributes $140 billion annually to Canada’s GDP, or about 5.5 per cent. But it carries out an incredible 40 per cent of total business R&D in Canada. That’s a testament to the power of ideas and innovation.
It’s also a timely issue, and one I underscored last week during my presentation and panel discussion at the Tremblant Venture Forum. I had the chance to speak to Canada’s Venture Capital Community. I tried to underscore how critical it is for us to foster innovation and what some of the challenges we are facing in Canada.
Here is the problem – Canada lacks a truly vibrant ecosystem needed to transform those ideas into bankable IT ventures, especially when compared to the activity we see south of the border. There are people out there right now with great ideas. Some will eventually grow into small but vibrant businesses. Others could be game changers – perhaps even the next disruptor. All they need is an environment that makes it as easy as possible to bring those ideas into the light of day.
Sometimes a time of crisis is exactly the time when we should be investing in innovation. Recently, Steve Ballmer, our CEO, spoke about the opportunities for startups and the need for technology innovation to drive the economy at Stanford University. You can see the transcript here.
Steve made this key point:
“In our business you've got to be inventing new things, because software doesn't wear out. It doesn't break, or at least if it breaks it was broken when you finished it, it doesn't break over time the way physical goods do. So the opportunity and need to invent, just like any other startup, or entrepreneurial activity remains strong.
So we're investing. Venture capitalists, there's going to be less venture capital this year than last year. There is still probably in my opinion more venture capital than there are really good ideas to absorb the venture capital. So whether you're going to join a startup, whether you want to start a business yourself, whether you want to join a company like ours, I think there's just incredible opportunities.
We want to be kind of a partner and friend to people who are starting these businesses. We've made our tools now free for students, for startup companies, qualified startup companies. We've made our software free so we can bootstrap entrepreneurs who want to come with us, and help pioneer and really pursue the future, the future for students, for consumers, for businesses, for the whole range of things.”
Well, if the opportunity is out there, David Crow expresses another dimension of this issue in a different way in his post here. Basically outline the frustration of trying to build a startup ecosystem in Toronto:
I’ve had a fascination with startups since the mid-1990s. I’ve worked for a few software startups of various sizes. I hope that I’ll be able to work for a successful software startup in Toronto. I read Paul Graham’s commentary about startups, startup hubs, Silicon Valley, and why creating a strong startup hub in Toronto is going to be very difficult. I read this and I also think that Paul is focused on bringing startups to his Silicon Valley (Y Combinator is headquartered in Mountain View [April 29, 2009]) and this may influence his results. However, his logic is really good. Joey has written extensively about “Ideas to steal from Silicon Valley & Seattle”. I don’t want to rehash the basic logistics of what parts we can repurpose locally.
To make this kind of ecosystem happen, we need to develop new approaches to the incubation of people, ideas and technology. One of the many ways Microsoft is doing this is through BizSpark, a unique program designed to accelerate startup success by providing fast, affordable access to current, full-featured Microsoft tools and technologies, plus production licensing for hosted solutions. It also provides visibility to an audience of potential investors, clients and partners.
Canada needs technology innovation to drive our productivity and our overall economic prosperity – especially as the fundamentals of our economy change during these tough times. At Microsoft, we’ll be doing more in the months ahead to help, because there’s no time to waste. We need true investments in technology innovation and we need to ensure that Canada grows the infrastructure to be the best place to grow new ideas. The time to act is now.