DeepPixel, ShinyDocs founders on why Canada should stop comparing itself to Silicon Valley

Canada has developed a thriving ecosystem for technology startups and should stop comparing itself to Silicon Valley, an entrepreneur with eight years of experience in the San Francisco Bay area told the audience at Technicity, ITWC’s annual smart cities conference.

Speaking during a panel titled “Toronto as a Startup Rocket: Challenges and Opportunities” Giri Amarakone, founder and CEO of customer engagement platform developer DeepPixel, said that while Silicon Valley has some undeniable advantages over Canada, the great white north and especially Toronto enjoys an advantage many cities don’t: Its embrace of multiculturalism and open-armed immigration policies attract the best talent from around the world – a boon for the many startups that provide them with an outlet to reach their greatest potential.

“Silicon Valley is like the Vatican City,” said Amarakone, who spent seven years at the San Francisco office of chip maker nVidia and another year with Bay Area semiconductor manufacturer MediaTek. “There’s only one Silicon Valley… But I think Toronto should be proud of the fact that it’s a world-class city, and maybe even better than New York and London and Hong Kong.”

In fact, Amarakone added during a discussion with IT World Canada, he would say Toronto is a better environment for technology startups than London and Hong Kong, to say nothing of other American cities.

“If you are in, say, Salt Lake City, you can have a startup, but is your talent pool from all over the world? No,” he said. “I think that’s a benefit for Canada, and especially Toronto, that few other cities can compete with.”

“We can look at Silicon Valley as the target long-term, and that’s okay,” he added. “But we shouldn’t be disappointed that we’re not Silicon Valley, because we’re still up there.”

Amarakone was joined onstage by Jason Cassidy, CEO of enterprise data management firm Shinydocs, who said he believed that while Silicon Valley might have the greater commercial advantage, Canada has the big cultural advantage.

“I think Canada is the best place in the world to live,” Cassidy said. “We’re a tough, but polite culture, very well-educated, and I think act appropriately on most or all social issues, so far as I can tell.”

TorontoStarts founder Craig Major agreed with his co-panelists’ assessments, saying that in Toronto’s case, between eight postsecondary institutions, 70-plus incubators, federal and municipal government support, and more than 400,000 tech workers, the city has become an ideal home for startups, with his organization alone growing from 130 members to more than 7000 over the past two and a half years.

“We are having a moment,” Major said. “It’s the best time to be a startup in Canada.”

A supportive environment, for the right people

Another advantage Canada’s startup culture has over other places is its spirit of collaboration, Major said.

“We have a very open community here,” he said. “If you’re an entrepreneur you can approach any startup and they’ll be happy to have you over and talk about their successes and failures.”

More than many of their peers in the business world, Major said, entrepreneurs know that when larger enterprises like Target Canada close up shop, putting 17,000 people out of work, those jobs are not coming back. Their replacement? New startups, which hire five, 10, or 20 employees at a time.

“People want to get involved, because they know you’re small and they can have an impact,” Major said. “We’re really focused on helping the small businesses turn into big businesses here, because that grows the economy for everyone.”

That doesn’t mean there aren’t challenges, Shinydocs’ Cassidy warned, noting that each entrepreneur has their own breakthrough moment that gave them enough personal motivation to leave the security of a day job behind. For him, that moment came working in the corporate world and realizing that he craved autonomy.

For Amarakone, much of the appeal has come from the variety of tasks he gets to perform.

“You get to play a lot of different roles in a startup… and I’ve always found I’m much happier that way,” he said.

Also important to Amarakone is the opportunity a startup offers to feel like he’s making a difference in the world.

“It’s not driven by money,” he said. “You can make a lot more money working for a large corporation than a startup, but if you’re driven by wanting to make a difference, I think people can make a bigger difference with a startup.”

Two key challenges

When asked to name the biggest challenge he faced after founding a startup, Shinydocs’ Cassidy recounted how difficult it had been to secure the company’s first big customer, noting that startups should not focus on enterprises first, because you cannot prove their products’ excellence as well as their larger competitors can prove their competence.

“Big companies are risk-averse. Municipalities are risk-averse,” he said. “When you’re first selling your product it doesn’t matter if it’s the best thing ever, it has to be proven, and how do you prove yourself when you’re a startup?”

In Shinydocs’ case, the company’s first large customer was Derby (pronounced “darby”) City Council in the U.K., which hired Shinydrive to take over a previous company’s implementation of Toronto-based Open Text’s Content Suite platform.

“We had done other, smaller deals, but that was the first hundreds of thousands of dollars deal,” Cassidy said. “It was an introduction from another customer, something we nurtured over about six months, and the people there really believed in what we were doing and wanted to do it on a grand scale.”

According to a Shinydoc release, Derby went from receiving 35,000 document requests on Content Suite per month to 300,000 document requests per month after Shinydocs deployed the software – and had used the platform to add an additional three million licenses to the municipality’s records after six months.

Demonstrating the magnanimity that TorontoStarts’ Major praised, Cassidy said the trick for aspiring entrepreneurs is to make sure your company’s offering has value and associated patents, and tell its story very well.

“You just need that first win – and you’ve got to make sure it’s a win – and then keep building on that,” he said. “And we’re still phoning every customer to ask, ‘how’s the deployment? Do you need anything else from us?’ We’re not necessarily trying to sell them anything new, but everything that we learn from the health of our deployments helps us drive more business, and we discover things that we didn’t know about our customers, and new opportunities.”

Amarakone, meanwhile, said his company’s number one challenge was financing. While Canadian venture capital is not unheard of, it tends to be risk averse, he said, and few U.S. investors will cross the border for less than $10 million, which limits new startups’ access to capital.

“If Toronto wants to become Silicon Valley in 30 years, it needs to invest a mammoth amount of money into risk capital,” he said.

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Jim Love, Chief Content Officer, IT World Canada

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Eric Emin Wood
Eric Emin Wood
Former IT World Canada associate editor turned consultant with public relations firm Porter Novelli. When not writing for the tech industry enjoys photography, movies, travelling, the Oxford comma, and will talk your ear off about animation if you give him an opening.

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