The Rapid Growth of Montreal’s Cleantech Sector

Published on August 18, 2021

Takeaways

Governments at all levels are throwing their support behind the cleantech sector in Montreal and Quebec, allowing for a major boost in startup growth.
Collaborative approaches spearheaded in Montreal have enabled businesses to much more effectively convert from lab to commerce.
Montreal has no shortage of key talent and innovative entrepreneurs entering the cleantech space to push for more innovation.

Action

The cleantech sector in Montreal is evolving rapidly, buoyed by a number of supports from all levels of government. But to reach its full potential, there is much work that must be done to assist the commercialization of clean technologies coming from Canada’s academic institutions.

What does Cycle Momentum do?

Cycle Momentum is a startup accelerator and an innovation enabler for large corporations. We strive to grow the cleantech startup space in Quebec over the next three years and to 50 companies accelerated per year. We cover all the areas of cleantech from clean energy to waste transformation, urban tech, and agtech.

What does cleantech mean in the Quebec context?

Cleantech is any technology that has a positive effect on greenhouse gas (GHG) reductions. It has to have a positive impact on GHG emissions but also on air and water quality. We are adding the water component to our focus as well.

What differentiates the cleantech ecosystem in Montreal and Quebec from other parts of the world?

Cleantech is an emerging sector in Quebec that enjoys strong support from government, investors, the tech sector, and the startup space. There is a focus on certain key areas like batteries, hydrogen, water tech, and agtech. We recently launched an Open Innovation Challenge program with Hydro Québec and other greenhouse producers of Quebec.

One sector that we do not talk a lot about is water tech. If there is one place on this planet where we should be developing intellectual property (IP) around water tech, that place is the Province of Quebec. Quebec has natural resources, a high number of lakes, and the St. Lawrence River, which used to be an economic powerhouse and is now a geographic landmark here. I am quite bullish long-term on water tech. Cycle Capital, which we are part of, launched the first water tech-dedicated fund, the BleuImpact Fund, in fall 2020. We are putting our money where our mouth is and that is one trend that is going to be emerging.

What are Montreal’s competitive advantages when it comes to attracting foreign investment in cleantech?

Attracting investors is a key component to growing the startup ecosystem in Montreal. In March, we launched the Partner Funds’ Circle at Cycle Momentum. The goal is to attract and bring together investors from different geographic areas. We started with local investors that have a cleantech practice but three or four weeks ago, we announced new members in that Partner Funds’ Circle. We added Clean Energy Ventures from Boston, RiSC Capital from Toronto, and GreenDev from Toronto. The goal is to build that list to 50 key investors that have a cleantech focus over the next three years. We want to have a community of investors from all over in the Quebec cleantech space.

What are the supports available for cleantech entrepreneurs and innovators in Quebec?

There are many programs. The federal government announced several programs recently. They are yet to be fleshed out in detail but on the Quebec level, there are many programs stemming from the sectoral branches of government.

The Ministry of Energy and Natural Resources has programs supporting the cleantech space. There is MAPAQ, which is the Ministry of Agriculture, Fisheries and Food, which has several programs supporting entrepreneurs and agtech entrepreneurs as well. The Ministry of Economy and Innovation has programs specifically for startups in cleantech. There are a plethora of programs for entrepreneurs that are very interesting and come at the right time to support entrepreneurs, whether they want to grow their business or if they are starting their business at different stages. The municipal level also has programs. The municipal government recently launched a call for projects from April to May to support entrepreneurship in cleantech and the circular economy.

“There has never been a better time than today to be an entrepreneur in cleantech in terms of the availability of government support.”

There has never been a better time than today to be an entrepreneur in cleantech in terms of the availability of government support. There is a lot of enthusiasm and focus on that space whether it is in batteries, agtech, industry 4.0, or reducing GHG emissions and having a cleaner industry.

What is the availability of talent in the cleantech space in Montreal?

Montreal is perfectly positioned to become competitive at an international level. We have five university centres based out of Montreal with thriving engineering schools and computer science programs. On that front and in terms of research, our challenge is to make sure that we are converting from lab to industry to commerce more than we have in the past. The challenge lies in going to market with these burgeoning, budding technologies, and that is something that we are going to want to contribute to over the next few years. There are programs that are set up right now to help convert these university projects into businesses. Polytechnique Montréal and ETS Montreal are working on that. McGill University, through the Dobson Centre for Entrepreneurship also has a program for entrepreneurship. These are just a few of the ways to help convert from lab to market.

What are some exciting recent developments in Montreal’s cleantech ecosystem?

I am in a lot of talks with large enterprise right now and there is a lot of enthusiasm for open innovation and collaborating with the startup ecosystem. Collaboration between big enterprise and startups is a healthy sign that we are going to be looking at a much brighter future for cleantech. It is a green light flashing on my dashboard for sure.

“Digital tech entrepreneurs have experience in developing rapid and agile roadmaps, and they can bring that mindset and operational experience into cleantech.”

We are seeing more entrepreneurs wanting to convert from digital tech to cleantech. I come from digital tech myself with 20 years in the industry. Then, I co-founded a company in the cleantech space in 2015 called Téo Taxi. Most entrepreneurs that are in digital tech do not necessarily think about crossing over to cleantech but I am seeing that more and more right now and that is encouraging. Digital tech entrepreneurs have experience in developing rapid and agile roadmaps, and they can bring that mindset and operational experience into cleantech. This resolves one of the issues in the cleantech space: long roadmaps.

“There is demand for a large pipeline of entrepreneurs.”

Cycle Momentum has the ambition to multiply the number of companies accelerated in our programs by five. Typically, we were running two programs per year, which gave us 10 companies from 2014 to 2020. This year, we doubled and are now at 20 companies accelerated. We want to triple that next year, bringing it to 50 companies accelerated. There is demand for a large pipeline of entrepreneurs. That is what we want to help contribute to for Montreal. We want to change the perception that there is no deal flow or enough entrepreneurs in Montreal. On the contrary, we are seeing an emerging space. There is a ton of enthusiasm for the cleantech sector, from investors to governments and corporations. I see a bright future ahead of us.

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