Real Impact from Very Real Startups
FREDERICTON'S CULTURE OF INNOVATION
Real Impact from Very Real Startups
Last month, we shared with our readers why Fredericton is an attractive and ideal place for entrepreneurs looking to start, grow and locate their business, and what makes Fredericton a strong contender in attracting and retaining international talent. Apart from a compelling value proposition that includes cost-competitiveness, a growing population, access to innovation, and a lifestyle like none other, Fredericton is also a breeding ground for high-growth startup talent. In lieu of a recent article by Financial Post columnist, Diane Francis, claiming that the Canadian government is throwing taxpayer dollars at fake startups, we’d like to take this opportunity to shed some light on the impact accelerators/incubators have on the fate of our emerging startups, and the not-so-fake companies that are spurred from them.
Accelerators and incubators exist to guide early-stage companies through the complexities of starting and growing a business, connecting them with resources that are critical for rapid growth and commercialization. And though not all accelerators and incubators are created equally, it is arguable that they all follow the same general rhythm of preparing startups in becoming ready for investment and growth. Our “fake startups” have gifted us with a solid return on investment, and continue to do so against all odds - such as an infamous startup failure rate of 15% within the first year. We attribute this directly to the support our startups are given at an early stage. Let’s look beyond accelerators and incubators for a moment.
Fredericton takes a collaborative approach in fostering and supporting entrepreneurship. There are over 20 entrepreneurial organizations that have come together to promote, encourage, and support the innovators of today in accomplishing the dreams of tomorrow. This support model is why we were named the 2016 Startup Capital of Canada, and it is why we continue to see ongoing success.
A Tacit Elements report [The Value of Business Development and Growth] indicated that in the Greater Fredericton Area alone , Ignite Fredericton and Planet Hatch supported the development of 57 startup ventures. Each of these startups received varying levels of support from the local ecosystem and levels of government to accelerate their growth. However, this support wasn’t just a handout; collectively these startups created 245 full-time equivalent jobs and returned over $2 million in tax revenue to government. The impact? Over the course of a year, this translates to approximately 34,000 restaurant visits, 120 cars purchased, and 17 new homes, all attributed to startups. Seems like real ROI to us!
Financial Post columnist, Diane Francis, claims that Canada is throwing billions of dollars at "fake startups” based on “slick slide decks” and fancy jargon. Fortunately for us, these “fake startups” are getting pretty good traction in the market. Fredericton has had over $1 billion in tech exits since 2009, including the exit of Radian6 and Q1 Labs, a catalyst for the dawn of the startup movement in Atlantic Canada, which has since resulted in 27 startup exits in the region. A recent example of the many companies to benefit from the services and support offered from an acceleration model is Resson, a data-driven agriculture technology company that announced McCain Foods Limited and Monsanto as a strategic partner in a CDN$14 million Series B investment round.
Silicon Valley did not become what it is overnight through sheer private sector will; it had similar public sector investment, community-building and thought leadership. In Fredericton, entrepreneurs are making use of government grants to develop products while finding ways to creatively solve problems. Some startups are finding solutions to everyday pain points, and some are contributing to the resolution of major global concerns. Whatever their involvement, each one of them are contributing to the growth and progression of the Canadian economy and most of them, if not all, found their footing in a startup accelerator/incubator.
Ignite Fredericton | Knowledge Park | Planet Hatch