StartupNorth

Category: Canada

  • Making 2011 a BIG year

    2011 is the year for us to find some winners and to make them explode on to the international scene. 2011 is the year for Canada to pull out of the pit and to hit the track hard. It is going to get a bit crazy and you have to decide for yourself whether that is a good thing or not.

    2011 is the year we capitalize on some of the hustle of the last 3 years and when we all focus on building some huge successes.

    For a lot of people 2011 is the year of winning big.

    Economic indicators continue to suck, but it doesn’t seem like anyone cares. Competition is heating up and everyone is ready for a good brawl. Year of gluttony. Present company excepted of course.

    Howard is going to Russia. As an EIR I have been practicing sitting back in my chair, putting my hands behind my head and saying “What’s your China strategy??” (that’s a joke BTW)

    The IPO market will not be back in 2011 though. Frankly, I don’t care.

    You are going to hear less editorial from us at StartupNorth in 2011 because we are going to be focused on the big wins. I am putting my money and time to work in startups that I think are going to KILL IT. Where are you focusing on 2011?

    2011 isn’t about kumbaya for me. It’s about making the best of a good time. We live in good times. I’m not throwing the baby out with the bathwater, but I want to see the baby put to work.

    This is the year to take your shot. Either exit or go big

    Opportunities in 2011 will be outsized compared to what we have seen and may be better than we will see again for another five years.

    The bears are all tired and the bulls will be back to buying. The “early exits” and “talent acquisitions” we have seen in the last 18 months will continue, but we will also be back to some really big opportunities.

    This is the year to take that leap.

    Whether you’ve been working on an OK business that needs scale, or you have a killer founding team ready to come together to attack a huge market, then this is the time to gather resources and to really focus on making it happen.

    Can you do it in Canada? Good teams are going to get funded. Good teams and big ideas. Before you start worrying about your idea, think about your team and how you are going to execute.

    This is the year to try that big idea.

    Whatever you are passionate about, 2011 is the year when people with big ideas will finally be listened to again. No more “that will never work” — it’s going to be optimism and opportunity. People are ready to listen to visionaries again and we need them. Whether it is social change, a new startup or a research project — this is your time to roll.

    If you have been sitting on the sidelines then it is time to get off your butt and make your move. Now or never.

    Losers will be lost

    For some reason people always think that it is the losers that win in “good times”. That’s a load of crap. Bad companies will always be bad companies. They aren’t going to get any further ahead in 2011.

    Focus is still the name of the game

    Smart entrepreneurs will not be focused on valuations they are going to be focused on working with winners, because the wannabes are going to be coming out of the woodwork. Smart VCs will double down on the markets that they know well. This is not the year to spread yourself thin looking for the next sexy deal, it’s the year to double down on deals you understand and that you can ride right to the end.

    Canadian funds need to avoid being used as “runway” in later stage US deals. DIG IN and focus on taking good opportunities from Seed to Exit. Making things is still worth more than buying things.

    I normally hate predictions, resolutions and anything “year end”, but this time I am too optimistic to hold it back. I am already waving goodbye to 2010 and as far as I am concerned it is 2011 already.

  • 5 Thoughts on 5 Things I learned in 48 Hours

    5 Things I learned in 48 Hours – Techvibes.com.

    Some of my thoughts on some of his thoughts:

    #1 The Valley Feel- yes, it is true it does exist and it is unique to Silicon Valley.  That is not to say other areas don’t have a great innovation vibe, far from it! Some other areas have great innovation. But regardless where you are, it is good to stay on top of what is happening in the Valley.

    #2 The Valley Model- This I could take or leave. Yes, the Valley does have a unique VC-backed approach to innovation. But it isn’t the only way to fund and promote start-ups.

    #3- Think Small in Scope, and Large in Market- I love this idea. So true. Focus on what you want to do, do it super-amazing well, and then do what you do to conquer a huge (and growing) market.

    #4- You Can’t Phone It In- You really can’t. It takes work and preparation.

    #5- Be Yourself- Leave the impersonations to the comedians.

    #6- Start Local- I think this is the most interesting and ties in with points #1 and #2. Yes, be aware of what is happening in the Valley. Hell, be inspired by it, but don’t try to copy it (so I guess this ties in to point #5 also.) Find what is unique about your area and then build on that existing strength found, fund and grow your start-up.

  • Cognovision acquired by Intel

    UPDATE: We are hearing that the acquisition price tag is closer to $30m and possibly even higher. 


    Another great exit for the Toronto startup community and some great news in advance of CIX in a few weeks. Toronto based Cognovision has reportedly been acquired by intel. According to DailyDOOH, which covers the digital out of home market, the pricetag was $17m.

    Cognovision was the winner of the CIX pitch competition last year.

    I have to admit that when I first heard the Cognovision pitch, it felt holodeck cool. It also seemed “too good to be true” — Turns out I was wrong and the company shot to ~$1m in revenue pretty quickly. Using a camera on top of a digital display, Cognovision could give you some rough estimates that covered:

    • Actual Impressions – The number of people who look at your displays
    • Length of Impressions – How long people look for
    • Potential Audience Size – The number of people who walk by
    • Dwell Time – How long people stay near your displays
    • Anonymous Demographics – Demographics of your audience (gender and age bracket)

    Congrats to Shahzad, Haroon an the entire team.

  • It's about to get a little crazy out there . . .

    Ok, here’s the thing. The “is this another bubble?” conversation has been going on for a while, and everyone was able to agree that there hasn’t been a bust imminent so far. It might have been dragged out by the sluggish economy, it might have been a function of a lot of effort going in to building actual technology and less going in to building companies, I don’t know.

    But it is clear now that a change has taken place. I no longer talk to breathless and frustrated entrepreneurs who can’t find anyone to do their deal, instead I am hearing from frustrated and excited VCs who are trying to get in to the next hot deal. Personally, I LOVE it. Some really great deals are going to get done that SHOULD get done, but might not have just a few years ago.

    Fred wilson put the stake in the ground today and his post will go down in history as the first one to truly call the bubble.

    Things are going to get wild very soon. This is a great time to be raising capital as a startup. A lot of fundamentals are now either stable or rapidly moving up. From economic indicators (and their relation to the Web) to the creation of new funds. From consumer to enterprise. Things are good, all good. Get out there and build build build!

    NOBODY MOVE

    This is where we can easily start to make mistakes as a community. I have written about our need to think differently about the Canadian startup ecosystem and that feels more important than ever now.

    The first DemoCamps, which were started at the lowest point of the trough between the last bubble and today, were focused on finding the most innovative, interesting and valuable ideas/companies and there was very little focus on anything other than a few fundamentals. Who would pay for this? Why is it valuable? Will you be able to scale it?

    Let’s keep asking those questions and lets make sure we build STRONG startups in the next 5 years. Valuations will rise and the volume of startups will continue to increase, but I believe we can do it in a healthy and sustainable way.

    LPs need to focus on backing funds that can create value in their portfolio, not just the ones that can get them the sexiest deals (at the highest valuations no doubt).

    VCs need to avoid acting like every deal is the deal of a lifetime. We are JUST getting to a place where we can create startups in some quantity here in Canada. Overfeeding the newborns will just mean there is less for the kids who come later.

    Startups need to remember that valuation isn’t everything. A VC who understands your business, your customers and who can stick with you for longer than a few years is going to be critical. Don’t just jump at the first goofball who gives you the valuation you want. They’ll be coming out of the woodwork.

    Chances that anyone will listen to this? Zero.

  • Has KIK finally arrived?

    I have been using kik pretty much since it launched last April. It was particularly useful for me because I was spending most of my week in the US at that time and kik allowed me to TXT back home while avoiding Rogers/Fido/Telus/Bell’s atrocious $1/message TXT roaming fees.

    The kik app was always very solid and rarely crashed, but there were often delivery problems, even on kik-to-kik messaging. It also seemed to eat up a lot of battery on the IPhone and Blackberry. Those problems seem to be in the past however and it doesn’t seem to affect my battery life anymore.

    kik seems to have finally taken off. So much so that they are signing up an average of 3 users per second and the team is struggling just to keep their servers online. They have published a few graphs showing their signup volume and it is impressive. The sudden drop resulted from kik having to take their servers offline and their app out of the app store.

    As it stands, kik is Blackberry Messenger, but it works on Blackberry, IPhone and Android. I have tried it on all platforms, and they all seem to be equally good.

    There are a handful of other multi-device messengers, such as whatsapp, and it is hard to figure out exactly what the kik business model might be in the end. They originally talked about some sort of music streaming/sales business, but it is hard to tell if that is still the plan, and frankly I am not sure that my private messaging and music worlds should be mixed up like that.

    Whatever model kik does eventually settle on, it is probably worthwhile for them to focus on continuing the growth they are now achieving.

    Kik came out of Velocity at The University of Waterloo, which we have covered in the past.

  • Real Ventures closes

    Real VenturesThis is great news for Canada, well at least Quebec until additional funds close. Real Ventures has launched today. With both JS Cournoyer and Mark MacLeod writing about the close of approximately $40MM of money that must be invested in Quebec. They are actively looking for seed investments in Quebec software, SaaS and Internet deals.

    “We are seed investors in software startups based primarily in Quebec, though we will do deals in other markets. We like to be 1st money in and like to lead. We can do seed rounds in the six figures to get a product in market and can participate in series A follow ons for those companies that are hitting the gas pedal.” – Mark MacLeod

    The great part about Real Ventures is the pedigree. The team is: John Stokes, JS Cournoyer, Mark MacLeod and Austin Hill. These are world class investors, entrepreneurs, executives and people who have had a hand in shaping policy, companies and entrepreneurs over the past few years.

    “For those of you who don’t know, Montreal Startup is a $5M seed fund that was founded by John Stokes, Daniel Drouet, Alan MacIntosh, Austin Hill, and yours truly. Mark MacLeod has since joined the team for Real Ventures. We invested in 15 web, mobile and software companies between February 2008 and March 2010, including Beyond The Rack, Status.net, Whatsnexx, Vanilla Forums,Recoset, mConcierge, Oneeko and SocialGrapes. For the majority of our investments, we were the first money in, acting as the lead investor. We hold board seats in most companies.” – JS Cournoyer

    Real Ventures is the real deal. Any entrepreneur in Quebec looking to raise a seed round should be talking to Real Ventures.

    Congratulations guys, here’s to closing some money that can be deployed in Ontario.

  • Social Intranet Summit Vancouver

    One of my favorite startups in the last few years has been ThoughtFarmer. Every few weeks I check in on them and think “Microsoft hasn’t bought them yet?”. ThoughtFarmer’s social intranet is easily the most polished out-of-the-box experiences in the Social Business Software world right now. They have decided to put on a conference in Vancouver, which is coming up very soon. There are a few spots left and we were able to get a discount code that will give you $100 off, even this close to the event.

    Conference speakers include Dion Hinchcliffe, Enterprise 2.0 blogger for ZDNet and Senior Vice President for my old company Dachis Group; Stewart Mader, noted wiki expert ; Andy Jankowski, Director of Intranet Benchmarking Forum (IBF) North America; Bert Sandie, Director of Technical Excellence at EA; and Dan Pontefract, Senior Director and Head of Learning at TELUS.

    You can see the full speaker list on the conference website.

    **Receive a $100 discount using STARTUPNORTH as the promo code**

    Oh, and check out this hilarious video to promote their newest addons for ThoughtFarmer. It is an example of low cost but effective product education and marketing by a bootstrapped startup. Steve Ballmer makes an appearance as well.

  • FedDev steps up with $190MM for S. Ontario

    Photo by anitakhart http://www.flickr.com/photos/anitakhart/2737188217/in/photostream/
    Photo by anitakhart

    The Federal Economic Development Agency for Southern Ontario announced a new Investing in Business Innovation program. The program offers matching for early-stage venture funding. This is a $190MM running from 2010-2014.

    There are provisions for startups and angel networks. Since we’re StartupNorth, let’s try to deal with the startup side first.

    • Startups who receive a termsheet from a qualified angel investor (as defined by the Ontario Securities Commission) or venture capital firm (registered with the Canadian Venture Capital association) are eligible to apply for up $1MM in loan from the federal government.
    • Restrictions:
      • Start-up businesses will be eligible for repayable contributions up to $1 million for no more than one third (33? percent) of total eligible and supported project costs.
      • An angel and/or venture capital investor(s) must be committed to provide at least two thirds (66? percent) of the cash contribution toward eligible and supported project costs.
      • In-kind contributions related to mentoring, networking, and other business skills cannot be considered as part of the angel or venture capital investor’s cash contribution.
      • A maximum of one project per eligible start-up SME can be funded under the initiative.
      • Direct eligible costs for start-up businesses may include:
        • Labour, capital and operating expenditures;
        • Materials and supplies;
        • Consulting and/or professional fees (limited to market rate); and,
        • Minor and non-capital acquisitions (e.g., software).
      • All project activities must be completed by March 31, 2014;

    Basically there is federal government matching loans up to $1MM for startups that are raising angel or venture funding in Southern Ontario. This is a fantastic start.

    It’s great for startups in Southern Ontario, it’s curious that the program is only available in Southern Ontario. Why not all of Canada? How are the repayment terms set? Is this a zero percent interest loan from the Federal Government? Does the term sheet have to be equity investment? Is convertible debt eligible? How do startups “demonstrate they are using business mentoring, counseling, or related services”?

  • An enterprise startups survey

    Hey– if you are creating an “enterprise startup” (B2B) then I could use your help.

    I have created a short questionnaire that I am sending out to people who have built or are building enterprise focused software startups. This is not a formal survey, and I am not doing it for commercial purposes. What I want to do is collect the insights, advice and experience of people who have been-there-done-that, or who are in the thick of it right now.

    Please take a look and fill it out if it applies to you

  • Shoestring budgets & sponsorship

    We continue to run DemoCamp on a shoestring budget. Sure it sucks that it’s during the day. Sure it sucks that it costs $15. But we run these events at cost recovery. Sometimes we lose money (uhm, StartupEmpire anyone).

    Venue, food, Audio/Visual, and special things like a movie. They all cost money. BTW don’t forget the tax. The ticket price reflects the maximum we think people are willing to pay plus the maximum sponsorship amount we think we can cover. Did you know that a theatre + A/V + special feature + lunch is about $30/person+tax, almost $34/person. So we reach out to the community of companies and include the least amount of advertising and sponsorship. Make sure you check out:

    • Anand Agarawala and Bumptop! This is an EPIC sponsorship. You have to be at DemoCamp from 4pm-6pm to find out what it is.
    • Eqentia builds the a semantic publishing platform for knowledge tracking & competitive analysis
    • XtremeLabs is hiring agile engineers and ui designers for the hottest mobile development company on the planet.
    • Microsoft BizSpark jumpstart your startup and speeds up your time to market.
    • FreshBooks is the fastest way to track time and invoice your clients.
    • Mercanix develops tools that enable organizations and their people to do good work.
    • Rob Hyndman is the bee’s knees & the cat’s pajamas. Startups looking for a lawyer: Start here.
    • Rypple builds social software that makes workplace feedback easy and fun.
    • Dayforce is the hottest enterprise software company in Toronto. Hiring dev, qa, ui and sales ninjas.
    • Kontagent is a Facebook Fund funded startup that is hiring rockstar developers in Toronto.
    • OCE is helping commercialize the next generation technologies like Bumptop & Sysomos.
    • KPMG Information, Communications & Entertainment (ICE) practice helps startups to succeed in turbulent markets.

    These are organizations that are looking for funding, PR, and they are hiring. Are you a developer? designer? marketer? pr professional? Are you looking for a job? Make sure you check out each of these companies. They are part of our ecosystem. They support events like DemoCamp. And they make it possible for you to have a great experience. These folks essentially cough up a relatively small amount of money for a logo, a blog post, and the hope that events like DemoCamp make Toronto a great place to find and retain talent.