Funny how it takes a recession to get people talking about diversifying Alberta’s economy again. But it’s something that needs to be front-of-mind in good times as well as bad. In the past month two lists have come out that bode ill for the province’s post-petroleum future.
Report on Business ranked the 50 biggest technology companies by revenues in Canada and not one was based in Alberta. (Had they better access to private company financials as we do – we’re right now compiling the Venture 100 and PWC Private 50 lists for our September issue – they would have listed Smart Technologies of Calgary, but still that’s just one company.)
Canadian Business likewise published its Tech 100, ranking publicly traded companies by market capitalization. Here Alberta had a better showing, with seven entries. Nonetheless the top company was Internet service provider Axia Netmedia Corp., in the #34 spot. Whoohoo!
So, however much Alberta is the overachiever in Canada’s economy today, it is a pipsqueak when it comes to the corporate powers of tomorrow. Just next door in B.C. you have billion-dollar tech companies. Not here.
Just why we lag in this area is the subject of a number of interviews I’ve been doing with people connected to the technology sector that will make up a kind of debate for our Innovation Report in October. Here’s what I’ve been hearing:
- Private investors in Alberta are still unwilling to put their money into tech ventures. How can you blame them when you can get better returns in energy and real estate and not have to wait 10-15 years for the payoff?
- Provincial support was withdrawn during the Klein years and despite the Action Plan announced last summer, it takes time for the results to show.
- Federal research funds are overwhelmingly controlled by universities which have little or no accountability for producing a return on taxpayers’ money.
- Much of the talent needed to commercialize technologies must be imported and due to its remoteness, cold winters, taxes, whatever, Alberta is not particularly attractive to this cadre.
- Governments and even companies are focused on technology commercialization, which is essentially pushing things onto the marketplace. Like Research in Motion or any number of Silicon Valley startups we need to be focused on product development – creating real things that customers want to buy.
Most in the industry seem to consider the Action Plan a step in the right direction. However it may take another 20 years before, as one financier put it, technology is more than a “rounding error” in Alberta’s GDP.
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