In November 2020, KPMG launched the British Columbia Expertise
Report Card – Tackling the Scale-Up Problem (the “Report
Card”) which offered a priceless glimpse into the present
state of the British Columbia know-how sector as in contrast in opposition to
different sectors in BC and different tech sectors throughout the
nation. B.C.’s know-how sector scored high marks
in comparison with different industrial sectors throughout the province.
Nevertheless, when evaluating B.C.’s know-how sector to the
know-how sectors in different provinces, the Report Card gave B.C.
solely a “B” grade.1 Whereas the Report Card
gave B.C. usually good grades throughout the board, its know-how
sector rating relative to different jurisdictions is one space the place
extra focus and enchancment will help make B.C.’s
know-how sector a pacesetter in each Canada and globally.
Fortunately, as outlined in McMillan’s June 2020 bulletin Making B.C. an Emerging Economic
Leader, the B.C. authorities has already acknowledged the
want for change to enhance the competiveness of the province’s
industries, together with by selling versatile practices and insurance policies,
harnessing intangible capital and mental property, growing
variety within the workforce, and minimizing air pollution and
environmental degradation.2 The province has begun
to implement these modifications by funding analysis and improvement and
coaching packages for individuals within the know-how sector.
Regardless of this, the Report Card discovered that trade leaders and the
provincial authorities should take additional steps for the know-how
sector to proceed to develop.
How Did B.C. Rating?
By reviewing and evaluating B.C.’s sector efficiency in
relation to different provincial industries, different Canadian know-how
sectors and different home and worldwide jurisdictions, KPMG
concluded that, whereas B.C.’s know-how sector is mostly
wholesome, it has not grown as shortly or as large as could be
anticipated. Partly, it’s because B.C. tech corporations have
usually tended to stay small and promote early. The
conventional enterprise mannequin amongst many B.C. know-how corporations is
to determine an awesome concept or piece of know-how, commercialize it,
after which promote the corporate to a bigger participant. Because of this,
the B.C. know-how sector has did not foster the expansion of
start-ups or rising know-how corporations into giant corporations
which are able to anchoring a big know-how sector.
A consequence of this shortcoming is that the B.C. know-how
sector has been unable to scale-up to achieve its full potential.
As recognized within the Report Card, the B.C. know-how sector has
underperformed in relation to the variety of medium to giant sized
corporations working in that sector in B.C. Their absence
limits the sector’s skill to develop to the heights
anticipated. As well as, whereas the variety of small and
medium-sized corporations has remained comparatively constant because the
final Report Card in 2018, there are nonetheless solely 22 corporations in
B.C.’s know-how sector that make use of no less than 500 folks.
The Report Card concludes that the brink for being among the many
high 10% of know-how corporations in B.C. is to have no less than 50
workers. By means of comparability, the identical threshold in Canada
is 100 folks, 150 in Germany, 200 in Israel and 500 in
To deal with this shortcoming, the Report Card requires extra
sustained multi-year public funding packages to assist smaller
know-how corporations develop from small to medium-sized and from
medium to large-sized. The BC Tech Affiliation’s
President Jill Tipping highlighted in her foreword to the Report
Card a transparent want for the province to advertise sustained multi-year
public investments in accelerator packages, which might give
smaller corporations entry to management coaching, new markets,
subject material specialists, and mentors and advisors.5
Based mostly on the Report Card outcomes, Ms. Tipping additional concluded
that by offering extra alternatives for corporations to scale-up,
B.C’s know-how sector might be extra prone to create jobs,
entice funding capital, spend money on analysis and improvement, and
create financial prosperity.6 The Report Card
serves to spotlight that, whereas B.C has a powerful know-how sector,
extra emphasis, consideration and focus is required to assist construct smaller
corporations into sector leaders or else run the danger of merely
sustaining the established order.
B.C’s Expertise Surroundings
B.C.’s know-how sector remains to be a “high 5″
sector within the province.7 Compared to different
sectors throughout the province, the B.C. know-how sector contributes
extra to B.C.’s economic system than a lot of the province’s different
conventional industries, comparable to forestry, mining and oil and
gasoline. As well as, on a nationwide foundation, the know-how sector
is starting to catch as much as the opposite giant provincial know-how
sectors when it comes to GDP and income. In reality, when put next
to different Canadian provinces, B.C.’s know-how sector has the
quickest progress charges in each GDP and income throughout the interval
between 2013 and 2018.8 Regardless of this constructive reality
nonetheless, as a result of the B.C. know-how sector is underperforming in
phrases of the variety of mid to large-sized corporations, it continues
to lag behind the know-how sectors in different provinces comparable to
Ontario and Quebec.
Employment in B.C.’s know-how sector grew by 70% since
2003, outpacing all different provinces, whereas greater than doubling the
Canadian common9. Employment progress elevated at
a five-year compound annual progress price of 4.8% from 2013 to 2018,
largely due to the rising variety of multinational corporations and
general progress of native know-how corporations.10
B.C.’s progress throughout the previous 5 years is double that of the
progress in Ontario and Quebec. Encouragingly, common weekly
wages in B.C.’s know-how sector have grown considerably
sooner than the nationwide common since 2016. Having mentioned
that, since 2018 wages in B.C.’s know-how sector have
stagnated which is a worrisome improvement.11
Lastly, B.C. know-how exports have risen at a five-year
compound annual progress price of almost 11%. Whereas that degree
of progress is constructive, B.C. has the potential to considerably
broaden its service exports. The B.C know-how sector
accounts for six.4% of the province’s whole exports, and 12.1% of
its whole service exports. This proportion of exports,
in comparison with different industries, continues to lag behind these of
different provinces and falls under the nationwide common for exports
associated to know-how companies.12 If B.C. can
elevate these exports to a degree according to the averages of its
provincial and nationwide counterparts, there’s the potential for
important progress in know-how service exports from B.C.
B.C.’s know-how sector is among the strongest and
fastest-growing industries within the province, as indicated within the
Report Card, however there’s work to be completed for the sector to achieve
floor on different Canadian know-how sectors.
A transparent discovering within the Report Card is that B.C’s know-how
sector, whereas performing moderately nicely, has struggled to create
an surroundings during which corporations can scale-up to a measurement the place they
can present long-term provincial financial power and
stability. Smaller corporations are sometimes nimble and early
adaptors or creators of recent concepts and applied sciences, however an absence of
available, expert and gifted sources, analysis and
improvement expenditure, entry to patented applied sciences, and
entry to the required progress capital is impeding the event
of a really world main know-how sector.
Nevertheless, a renewed concentrate on this subject by key provincial gamers
is a constructive signal. The Report Card confirmed that there’s
potential for a cloth enchancment within the skill of B.C.
know-how sector companies to scale-up, and the B.C. authorities,
via Innovate BC, the crown company that connects B.C. innovators
with B.C authorities funding, instruments, sources and assist, has
already begun to concentrate on this subject by internet hosting 2020 B.C. Tech
Summit particularly on “Scaling Up for World
Development”.13 As well as, the BC Tech Affiliation
launched a brand new HyperScale program which is a personalized mentor
strategy which gives seminars led by international specialists to
CEO’s, firm founders and govt groups to assist high-growth
tech enterprises scale-up to grow to be the following era of
provincial anchor corporations.14
The BC Tech Affiliation additionally launched a sequence of 11 key
coverage suggestions to help within the scale-up of B.C.’s
know-how sector together with, amongst others, introducing a
province-wide collaborative platform known as “ScaleUp BC”
and establishing a metamorphosis fund for B.C. tech
The BC Tech Affiliation states on this tech report that the
scale-up of the know-how sector in B.C. would deliver new
alternatives for progress, profitability and effectivity, and
financial stability to each sector. As well as, the BC Tech
Affiliation report concludes that scaling-up the B.C. know-how
sector will create nicely paying jobs and employment safety.
What Does This Imply for Your Firm?
Because the B.C. authorities, the BC Tech Affiliation and different
entities with an curiosity within the progress and scaling-up of the B.C.
tech sector flip their consideration to how the province will help
facilitate the event of a know-how trade which is actually
a Canadian and international chief, what you are promoting could have alternatives
to ascertain itself as a key participant in that trade.
Expertise companies could have higher alternatives to draw
funding capital, concentrate on analysis and improvement, and create
employment alternatives. To make the most of these new
alternatives, B.C. tech companies might want to be certain that they
have first taken care of some essential housecleaning
To start, they may need to make it possible for they’re correctly set
up and arranged from a authorized perspective to permit for traders to
be introduced on board. As traders look to inject money into
what you are promoting, you’ll want to be certain that your organization is
structured in such a method that it’s interesting to new
traders. If what you are promoting develops new know-how, you’ll
want to verify that you’ve the correct protections and authorized
language in place with respect to the possession of any content material
created by your workers or contractors to let you take
benefit of any and all alternatives to commercialize that
know-how with none authorized wrangling over the possession of the
works. Equally, if you’re creating any know-how that’s
eligible to be protected below any type of registrable mental
property rights (for instance, emblems, copyrights, or patents),
you will want to take acceptable steps to safe your rights
in such works on the acceptable time.16
Lastly, the authorized points an organization faces because it grows from a
small or rising firm right into a medium or giant enterprise change as
nicely. As your organization scales-up, you might start contemplating
different technique of financing what you are promoting, taking what you are promoting
public, establishing credit score amenities, or creating different funding
fashions to develop the enterprise. Providing your merchandise or
companies internationally additionally brings with it particular challenges
you will want to navigate fastidiously to make sure you keep onside with
respect to all authorized and regulatory necessities. Within the
trendy tech world, cybersecurity, privateness and knowledge safety
points are paramount because of the ease with which individuals can entry
and share delicate data. Guaranteeing you could have the correct
insurance policies for what you are promoting, each in Canada and past, to deal with
these points is a key issue to making sure what you are promoting can develop
shortly and with none important authorized
The Report Card clearly reveals that B.C.’s know-how sector
is powerful and rising at a gradual tempo. Nevertheless, the
“B” grade as in comparison with different know-how sectors
displays a transparent alternative for the sector to enhance and fulfill
its potential to grow to be the spine trade in B.C. To
obtain this potential, the provincial authorities together with the
know-how neighborhood must assist know-how corporations by
creating an surroundings during which native tech companies can
thrive. Already a high 5 sector in B.C, with the required
assist and funding, the B.C know-how sector can obtain grade
“A” standing, develop and contribute considerably to
B.C.’s provincial economic system as a complete.
1 KPMG, “British Columbia Expertise Report Card:
Tackling the Scale-up problem” (November 2020), at pg. 3, online (pdf).
2 Robert Piasentin and Josh Sved, “Making B.C. an
Rising Financial Chief” (June 2020), online.
3 BC Tech Affiliation, “BC Tech and KPMG unveil 2020
BC Tech Report Card” (November 2020), online (pdf).
5 Supra observe 1 at pg. 1.
6 Supra observe 3.
7 Supra observe 1 at pg.11.
9 Ibid at pg. 21.
10 Ibid at pg. 21-22.
11 Ibid at pg. 25.
12 em>Ibid at pg. 26.
13 Jill Tipping, “2020 Predictions for BC’s Tech
Group” (6 January 2020) online.
15 C Tech Affiliation, “BC’s $25 Billion Alternative: A
Transformation Agenda” (March 2020), online (pdf) .
16 See McMillan’s June 2020 bulletin Making Innovation Work for British
Columbia on the British Columbia Innovation
Commissioner’s report for additional data on mental
property points in B.C.’s know-how sector. B.C.
scores poorly in comparison with most OECD international locations with respect to the
variety of patent registrations, commercialization of IP, and
medium-term progress of rising corporations as a consequence of points with IP
leakage, insufficient incentives, the prohibitive prices of securing
patents, and low ranges of enterprise funding in R&D.
The foregoing gives solely an summary and doesn’t
represent authorized recommendation. Readers are cautioned in opposition to making any
choices based mostly on this materials alone. Moderately, particular authorized
recommendation ought to be obtained.