The technology sector is one of Canada’s fastest growing industries. Canadian industries have traditionally depended, and lucratively capitalized, on the country’s rich natural resources. The 2008 recession, however, sent the natural resources-dependent businesses into freefall. Canada is still recovering from the economic downturn, and many oil and natural gas businesses still struggle. On the other hand, Canadian technology businesses have thrived even in the slumping economy and have outperformed all other industries in recent years.
“Silicon Valley of the North”
The surprising success of the Canadian tech industry had led many experts to call it Canada’s next industrial powerhouse. Since early 2013, the tech industry stocks have grown faster than all other stocks in the Toronto Stock Exchange. As of early 2016, Canadian tech and innovation stocks amounted to more than $250 billion. The trend is still on the rise. Last year alone, over 50 new tech start-ups have gone public in the Toronto Stock Exchange.
The industry landscape is also changing; rather than the sector being dominated by one or two companies, like Blackberry in the past, the landscape now is more varied and even, with many small start-ups and multibillion dollar giants. Like the famed Silicon Valley of Canada’s southern neighbor, the industry is showing signs of a healthy “start-up culture.”
Independent analysts say that Canada’s tech sector will only grow stronger in the coming 5 to 6 years. Some believe the tech industry will be able to offset the thousands of job losses caused by the recession, and uplift Canada’s economy once more.
Canadian politicians have adopted developing the tech sector as one of the prime goals of reviving the economy for the long haul. The ruling Liberal party has placed special emphasis on technology, science, and engineering sectors in their $1.5 billion budget plan. The main opposition, the Conservative party, has also promoted investments in scientific research. In addition the New Democratic Party has supported increasing financial funds for space tech companies.
The Canadian tech industry is largely re-emerging. It first achieved a nearly frenzied growth in the 1990s, then became a bubble, and eventually burst. Many large tech companies at the time, like Nortel, went under. Industry analysts believe that this time around the situation will not escalate into a bubble, largely due to the start-up culture. Small tech companies are proliferating in the market, so the chances are low for a behemoth to go bust and doom the entire sector, Canadian analysts say.
Top Canadian Tech Companies
BlackBerry—An iconic brand and once one of Canada’s biggest companies, BlackBerry may not be as glorious as it once was, but it’s still a notable player in the sector.
Shopify—An e-commerce company based in Ottawa that is on its way to becoming a well-known brand worldwide.
Plenty Of Fish—The world’s largest online dating site.
Shoes.com—A popular retail website on its way to a highly anticipated IPO later this year.
Hootsuite—A social media and brand management platform increasingly becoming known globally.
Whos.Amung.Us—An analytics platform that shows websites traffic stats. Currently valued at $770 million.
Interesting Canadian Tech Start-Ups
Vision Critical—A popular platform that helps businesses engage customers.
Wiivv—An ambitious bionics company. The founders were featured in Forbes’ 30 under 30 list this year.
Compass—A software research start-up increasingly becoming known globally.
Atomwise—A state-of-the-art pharmaceutical drug research company.
Showbie—A virtual classroom app developer.
Slack—A powerful messaging app going toe-to-toe with giants in the field like Snapchat.
Figure 1—A sharing software for medical professionals known as “Instagram for doctors.”
Nudge—A networking app for offices.
Gaslamp Games—A highly commercially successful gaming company.
Canadian Venture Capital Firms
As the start-up industry has boomed, so have the venture capital firms that race to fund Canada’s own Facebook or Google. Here are the top Canadian venture capital firms supporting the tech industry:
- Georgian Partners Inc.
- OMERS Ventures
- Horizon Ventures
- AXA Strategic Capital