Is Canada Ready to Appoint Its First Public Chief Entrepreneur? 

Safeguarding domestic ownership, new head offices, and our talent necessitates the introduction of a Chief Entrepreneur above the bureaucratic, non profit-led, and politically driven approach of public-funded startup venture capital and community economic development throughout Canada. 

A thorough transformation of the public investment framework is essential. This update is crucial for achieving our public investment objectives, which involve retaining domestic ownership, promoting careers in the local living economy with a focus on integrating the Seventh Generation Principle, and addressing social and environmental inequalities. Such transformation requires placing special emphasis on providing and strengthening capital for potential ventures pre-revenue, transfering entrepreneurial wisdom with a sense of urgency, and facilitating a controlled incubation and acceleration of applied research through commercialization. 

Why Canada Needs a Chief Entrepreneur

The primary objective of these endeavors is to boost our return on investment in economic development and promote the expansion of domestic head offices and ownership. This is achieved through our commitment to developing a “made in Canada” solution, positioning us at the forefront globally.

As part of a provincial task force focused on the emerging economy, and later through my interactions with entrepreneurs and stakeholders within these economies, I identified three questions or areas of inquiry.

1. Can we substitute publicly funded venture capital (private can do as they like) with private equity to preserve head offices, ownership, and careers, eliminating the need for venture capital throughout the commercialization process within our country?
2. Would engineers, innovators, and applied researchers who may not see themselves as entrepreneurial founders benefit from a commercialization-as-a-service model?
3. Is the presence of Chief Entrepreneurs within public institutions such as post-secondaries and economic development agencies essential to propel Canada toward the emerging economy?

What is evident today is that following substantial public investment in Canadian applied research, commercialization, and startup and scale-up supports, foreign capital ultimately gains ownership of our most revolutionary innovations. An example of this is Cohere, a Canadian Artificial Intelligence firm. Our top serial entrepreneurs migrate to more entrepreneur-friendly countries, just like Stuart Butterfield of Slack did, and our academic institutions, economic development initiatives, and venture capital seem to have minimal impact on both the startup business ecosystem and on retaining domestic ownership and head offices. 

Transforming Investment Approaches

Knowing this, it becomes obvious we need to expedite our applied research in new ways, especially when one considers both the typical investment horizon of venture capital and the suggested timelines for addressing the challenges of global warming. I also have a suspicion that identifying alternative economic sources for public royalty revenue, especially those associated with the extraction of natural resources such as coal, will provide policymakers with clear avenues to quickly adopt the emerging economy. 

Historically, our established public investments in economic development, technology transfer offices, incubators, accelerators, and venture capital were considered acceptable and in many ways experimental, giving them all a lot of latitude. This occurred prior to the widespread discussions on climate science in politics and mainstream media, leading to a sudden call for prompt action in translating applied research into exportable commercial solutions. Adapting to this sense of urgency could prove highly challenging for current public leadership and the prevailing culture of public funding, given our inclination to adhere to familiar networks, training, and past experiences.

At present, there is a financial disparity between conventional grant funding for applied research and publicly funded venture capital. This incongruity serves as a reminder that both of these avenues are currently supported by revenue derived from public royalties tied to natural resource extraction. Reflecting on this aspect is crucial as we seek ways to mitigate practices that contribute to greenhouse gas emissions.

For example, outside the USA and China, institutional venture capital typically focuses on funding rapid growth rather than the pre-revenue stage, as we do in Canada. Acknowledging this disparity and politically recognizing the importance of climate science, there is a strong argument for exploring a new investment platform, particularly when considering the optimal approach using public investment. For example, a Canadian-centric strategy could entail collaboration between publicly funded granting agencies and publicly funded capital allocators to direct capital upstream after thorough due diligence. 

Ideally, this collaboration between the founder(s) and investor should occur during the pre-intellectual property phase, also known as Technology Readiness Level Two (TRL2). In redirecting public capital investments upstream to TRL2,  we could consider integrating public-private equity alongside private venture capital using a sliding scale regarding equity, creating new royalty streams to fund public services. This will position Canada at the forefront globally with a two tier investment model to accelerate the flow of capital towards pre-revenue innovation, thus allowing us to also attract foreign innovators with our domestic investment making this very interesting.

The incorporation of public-private equity provides a unique avenue to propel applied research through a controlled commercialization process. This would be a unique commercialization-as-a-service model designed in Canada and pioneered domestically for other nations to emulate. 

This public investment approach would also allow our scientific community to concentrate on applied research, by implementation of fractional business specialists and a Chief Entrepreneur into a made-in-Canada commercialization-as-a-service accelerator. 

Driving Entrepreneurship in Canada

Taking this one step further, the need for Chief Entrepreneurs, even on an ad hoc basis, becomes more evident when we assess the economic progress of government officials and post-secondary institution leaders on applied research and innovation. We must note of the value public entrepreneurs can add to public leadership as we look to maintain service levels, diversify our economy, and reduce greenhouse gas emissions. 

Today, there is a glaring shortage of serial public entrepreneurs in bureaucratic leadership positions on a national level. Consider, for instance, incubators, accelerators, and economic development agencies primarily led by well-educated not-for-profit executive directors, often looking abroad for models to emulate and manage. Isn’t this a clear sign of our deficiency in Chief Entrepreneurs?

Here are the factors we need to consider:

• There is a restricted flow of investment capital flowing upstream for pre-revenue applied research innovation at TRL2
• Canada has an absence of Chief Entrepreneurs in both government and post-secondary institutions who are able to urgently drive innovation
• There is insufficient support for engineers, scientists, and innovators who don’t want to be entrepreneurs
• Canada is abundant with business specialists across experience levels eagerly wanting to contribute

Given all these factors, one can conclude it is time to rethink how we grow our economy responsibly, knowing we have all the assets and just need to update our approaches with a made-in-Canada algorithm for commercialization and retention.

This remains especially valid if our focus is on prioritizing the establishment and maintenance of new head offices, as consistently emphasized by our elected officials. It is essential to scrutinize the fact that publicly funded venture capital typically leads to foreign ownership in almost all instances, with only a handful of exceptions.

Canada’s Future Chief Entrepreneur

It is time for our Governor General to appoint our first Chief Entrepreneur, positioned at the highest level, for example within our Prime Minister’s office.

This could include a network of Chief Entrepreneurs appointed by our Lieutenant Governors within the Premier’s office, and deploying Chief Entrepreneurs at all our applied research universities within the university president’s office. This will actively break down silos with a sense of urgency across Canada.

Furthermore, holding political parties accountable for public investments in economic development while prioritizing commercialization should be essential for Canada as we embrace the emerging economy and position ourselves as global leaders in attracting, retaining, and commercializing innovation with a made-in-Canada business model.

Introducing a commercialization-as-a-service model in all our applied research universities will allow for community access and frictionless support from our traditional publicly funded granting organizations. All publicly funded venture capital can be directed toward a publicly traded private equity holding company managed by, for example, the Business Development Bank of Canada or a new entity if needed. We must consider methods to open up investment accessibility for all citizens, institutions, and foundations.

Lastly, the urgent initiative of utilizing private equity to direct investments to vital upstream climate sectors must be pursued. This effort should be complemented by the establishment of a proficient Chief Entrepreneur, effectively propelling us into a prominent global position while diversifying our economy with a sense of urgency.