It’s a Canadian Fact. Canada’s Silicon Valley is Sizzling.

“Any sufficiently advanced technology is equivalent to magic.” – Sir Arthur C. Clarke

While the author of 2001: A Space Odyssey may have envisioned many incredible human technological advancements in his storied career – including the rise of the internet as far back as 1964 – it’s unlikely he could have predicted some of the triumphs of science and tech today.

And in many cases, science fiction has become science fact.

Driverless vehicles, artificial intelligence / machine learning, virtual reality / augmented reality, and the extension of technological innovation – at what seems to be progressing at the speed of light – makes it essential that Canada preserves its foothold as one of the world leaders moving through and beyond the 21st century. It is this kind of innovation and adaptation that is expected to drive global economies.

For Canadians, our version of Silicon Valley is located in southern Ontario in what is now known as the Toronto-Waterloo Tech Corridor aka Innovation Corridor. If you’re unfamiliar with the geography, it’s a distance of about one hundred kilometres and typically takes about two hours to drive by car. Waterloo originally became a tech hub back in the 1980s – with companies like Blackberry (TSE:BB) / Research in Motion leading the way.

Since then, The Corridor has expanded upon that reputation. Within the region there are more than 200,000 employees working for about 15,000 tech companies – 5,000 of which are start-ups within the past three to five years. While the growth is impressive, it must continue if Canada hopes to remain on the top rung with other leading tech hubs like the U.S., China, Japan, Taiwan, India and Russia – all putting huge amounts of resources into their national technology sectors.

Companies are always on the lookout for bright young individuals to help our tech ecosystem go from start-up to global player. It’s no longer good enough to be the best in your particular country or region. Technology has made the world a much smaller place, meaning that the innovations brought forth in other parts of the world are easily accessible in this digital era. All physical barriers to communication over appreciable distances have been resolved with the internet.


(Toronto-Waterloo Tech Corridor. Click image to enlarge)

The Kitchener-Waterloo Region now boasts the second highest density of tech start-ups in the world, along with the headquarters of some of this country’s biggest technology companies and development offices for leading global brands. BlackBerry introduced the world to smartphones from Waterloo. Toronto continues to flex its considerable muscles as Canada’s corporate headquarters and the centre of finance and venture capital, and some would jokingly remark, especially in the west, the universe. As a result, it’s a natural marriage to have these two regions connect together in tandem to create a world-class tech corridor. The Province of Ontario wants to accelerate the success of its start-up technology companies through strategic investments in infrastructure and support programs.

This incredibly diverse ecosystem that’s being developed in the Toronto-Waterloo tech corridor has shown great potential to be a leading hub for high-growth companies that are developing breakthrough discoveries that will help to shape the future of the world’s economy. The key word there is world. Not Canada – but the world.

In a December 2016 report, the American management consulting firm McKinsey & Company said the supercluster in the Toronto-Waterloo region “has the potential to become one of the world’s top innovation ecosystems.” The innovation Corridor already contributes a substantial amount to the Canada’s GDP. Now, the question becomes how does it take that potential to can it be one of the world’s true technology superclusters?

It would seem as if all of the prerequisite ingredients are in place in order to have a successful supercluster including talent, quality of life, education, the ability to scale up, cost competences, and the increasing influence that the GTA now has on the international stage as a leading business centre. The report went on to state that the southern Ontario tech hub has helped Ontario improve from 14th to eighth in global ranking of attraction to venture capital, while capturing more foreign capital investment than any other North American jurisdiction in recent years.

Although the Toronto-Waterloo corridor has access to an immense pool of talented professionals and new graduates from some of the best universities in the world like the University of Waterloo and University of Toronto, it is still not substantial enough to meet the demands of a growing regional, national, and international economy. For this supercluster to be a world leader in emerging technologies it must attract and retain top talent to address the continuing skills shortage.

The Toronto-Waterloo Corridor needs to keep up with other international cities and not allow itself to be leap-frogged as new technologies are created and developed. Still, the U.S. and Silicon Valley in particular, is much more mature and is essentially driving itself without the assistance of the American federal government.

Companies in Canada still remain largely underfunded and that does not help in the expectation of being at the front end of the innovation curve.

According to the Brookfield Institute for Innovation + Entrepreneurship’s State of Canada’s Tech Sector 2016 report, Canada’s tech industry consists of 71,000 companies operating coast-to-coast and employs 864,000 Canadians, accounting for nearly 6 percent of the country’s workforce. Those figures are going to continue moving in an upward direction because it’s the way the world’s economy is moving.

Information and communications technology (ICT) companies account for the majority of the tech sector’s national economic output, contributing 61 percent of the total, while employing 55 percent of all Canadian tech sector employees.

International technology powerhouses such as Apple, Google, and Amazon have stocks that are valued much higher than those of many historical industrial companies like General Motors, GE, etc. The economic volume of the tech sector is now valued at over $6 trillion per year. To put that into perspective, if the global tech industry were a country, it would be the world’s third-largest economy, behind only the U.S. and China, but ahead of Japan. At press time, Canada ranks 10th on the list.

The massive disruption of the tech industry on the global economy is just now scratching the surface. And it’s going to expand at a much more rapid pace moving forward and for that reason alone it’s essential that Canada remains a major international player.

Stockhouse tech investors, along with Bullboard readers and posters, have taken note of Canadian technology leaders like TruTrace Technologies Inc. (CSE:TTT, OTC:TTTSF, Forum), YDX Innovation Corp. (TSX-V:YDX, OTC:YDRMF, Forum), NexTech AR Solutions Corp. (CSE:NTAR, Forum), Datametrex AI Ltd. (TSX-V:DM, OTC:DTMXF, Forum), and DigiMax Global Solutions (CSE:DIGI, Forum) as emerging companies to keep an eye as the tech sector continues evolves into 2020 and beyond.




FULL DISCLOSURE: TruTrace Technologies Inc., YDX Innovation Corp., NexTech AR Solutions Corp., Datametrex AI Ltd., and DigiMax Global Solutions are clients of Stockhouse Publishing.