Toronto’s transformation to Silicon Valley North | Hacker News Reader

Toronto’s transformation to Silicon Valley North

theglobeandmail.com

64 pointsfaramarz30 comments

As someone that's grown up in Waterloo and Toronto and also worked in SV for about a year it's a little annoying when writers compare one city to all of SV. SV is the corridor that runs from and includes San Fran down to San Jose. This is quite similar to how the Toronto to London corridor is setup. Except in Canada's case you have the 401 instead of the 101, no Caltrain equivalent, and there's quite a bit more farmland in the middle.

Overall though the past few years has seen a huge number of new and exciting tech companies pop in this corridor. Primarily In Toronto and Waterloo.

What'll truly make this place a force to be reckoned with is if we have two or three more big corporate HQs. Right now it's really just RIM. The problem is that as soon as a company starts getting pretty big they get bought out by an American for lots of cash. That's not a problem for the people doing the company of course, but that common path prevents a huge company growing here, and I doubt any major Corp is going to move their hq here.

For reasons why Canadian companies are more likely to sell out than try to make it big on their own I'd have to guess it's a combination of more conversative attitudes and the lack of big vc financing. It's just a different culture here. Most of the successful companies in this area are not VC financed. We like to blame that on the VCs but I have a suspicion that the entrepreneurs here are also less VC friendly in general.

Either way it's an exciting time to be here and this place is going to be very different in 5-10 years. Waterloo especially.

Not to pick a nit but as someone who grew up in the San Francisco Bay area,

San Francisco is very tech heavy but is separate from silicon valley. I put the Northern most edge of SV at the Oracle complex in Redwood Shores. But back during the bubble that was too far north for some.

Also SF seems to be gaining more traction with Web 2.0 then with the 1.0 trend so my statement may be facing a shift with companies like twitter and digg making their homes in SF proper.

There are tons of tech companies that are north of that Redwood Shores complex, virtually all the programmers I know work north of there actually.

I'm not actually disagreeing with you, I'm just saying that at some point there's an edge of SV and it does not actually reach as far north as SF.

Wikipedia at least seems to agree (though of course it doesn't have an edge instead saying "Southern Peninsula") http://en.wikipedia.org/wiki/Silicon_Valley

Also remember the term actually didn't refer to software companies originally it referred to the semi-conductor and chip makers who pretty much stayed in santa clara county.

Well said.

One thing I really agree with is the point in the article about needing a big Canadian buyout. the money will trickle down to a new generation of startups, much like the Paypal ecosystem. Freshbooks, Shopify, Tripharbor are on that track IMO.

Also, it's worth nothing the Bumptop acquisition by Google basically validated our new VC regulation changes which passed few months ago.

Edit: Worth noting... not nothing. typo.

> Also, it's worth nothing the Bumptop acquisition by Google basically validated our new VC regulation changes which passed few months ago.

Faramarz, can you elaborate on this?

Sorry for the typo, I mean worth noting

I'm referring to the tax break for foreign investments and streamlining the acquisition process by outsiders (where as before, it would take months and months to do the paper work) Read about it here http://techcrunch.com/2010/03/08/canada-now-somewhat-less-an...

Interesting, thanks for the link.

I actually misread it as noting anyway, so our errors canceled out :-).

I think we need to stop trying to coin the phrase "Silicon Valley North". Toronto, or Ottawa, or Montreal or Vancouver can not, and never will be SV. The infrastructure, funding and talent just isn't here. Instead, Canadians should be proud to create new companies that aren't part of the "echo-chamber", but are instead profitable, disruptive and innovative. We should be trying to model NYC and the companies they are pumping out rather than trying to be a whole other ecosystem.

While I value the positive press, assigning the words "Silicon Valley" to Toronto is quite a misnomer. As a lifelong resident of Toronto / member of the tech business community, I've watched many of our best business/tech minds get sucked south of the border - leaving local businesses with a real lack of high quality senior tech talent. I can't blame them - lots more opportunity down there, and businesses in the US on the whole more welcoming to new entrants than up here in government-sanctioned monopoly land.

At the end of the day, I think if you look at Chicago, Boston, or any other big US city you will find an equal if not larger number of successful tech startups.

> *"I've watched many of our best business/tech minds get sucked south of the border"

This is something a lot of Canadians do not realize. I don't consider myself the best, but I am currently south of the border because the going pay is nearly twice what anybody in Canada is willing to offer (note: I am fairly young). I've seen senior folk drift back to Canada - as you age your own health care, as well as that of your family, makes the USA less attractive overall.

Hell, many of my most talented peers from school in Canada are now State-side - the brain drain is real, and it is indeed massive.

Very true, payscale just doesn't match to what the offerings are south of the border. Some say there more attraction for 'senior' talent - with families,with reliable and free healthcare and fairly family friendly city. That is however not what startups need. They need daring fresh talent, and such talent requires a fertile soil to be planted on.

Just as article pointed out, Haze of Finance covers everything. That may mean smarter, brighter people will go to finance in Toronto, or go south work on exciting projects.

One great thing Toronto, has rest of Canada has less of, it 'lets do it' attitude. Whats hindering it though, very canadian attitude to seek consensus. We like to get permission, something disruptive business models do go against.

It seems there is a lot of hurdles Toronto has to overcome before making it huge as an IT Startup Hub. I believe New York is also having some sort of cultural issues as well in trying to grow up as the fertile place for starups. [ Its this whole east coast thing :) ] my 2c

Admittedly anecdotal, but I found for me, after taking into account higher cost of living and higher payroll taxes in the US, the pay scales are comparable.

Agreed. This is very true of many wannabe SVs. I worke in the Bay Area (Mountain View, Palo Alto, San Francisco, Redwood City) for 10 years. I then moved to Europe following a trail of jobs (London, Lyon, Paris) and I now live and work still in software in Portland Oregon. There is nothing like the Silicon Valley. Every city or metro area who tries to mimic its unique ecosystem is better off charting its own trail with a different approach I think. There is only room for one Silicon Valley but other metros can create a unique distinctive environment for very focused types of industries (Open source in Portland for instance - Linus T. even chose to live here ;-) Also, not every senior software person wants to deal with the Bay Area's urban and suburban environment ; and the lack of diversity (non-tech industries) it certainly features.

As an American, who's tried for years to do business in Canada. The appetite to purchase stuff is strangely not there. I found similar stories amongst colleagues in other companies as well. Endless demos, pitches and such, just like you might do anywhere else -- but almost never a P.O. at the end of the process.

I've had far more success in Australia, and I've heard similar as well. I only bring the Aussies in because of the similar population dynamics, small population, large land area, a few major metro areas.

I can only imagine that it's similar north of the border, trying to do business internally, as well.

Not a fan of the the use of the phrase "Silicon Valley North", but good press for the Canadian startup scene is ... good.

One of the great points made in the article is about the pick-up mechanism:

"""“Say you’ve got three brilliant young people graduating – one from Waterloo, one from Ryerson, one from U of T. They’re best buddies, and they start a company – and it fails.”

When a region has a thriving ecosystem, talented workers land on their feet instead of decamping.

“In Silicon Valley, they just pick up the pieces. Others say, ‘You’re fabulous people, come work for us now.’ We don’t have that pick-up mechanism.” """

Toronto is getting closer to this. Montreal too. Almost there.

I'm Toronto-based. While I was working on my first startup, I received many more job offers than when I was salary-based. A large part of this is, of course, that when you're working on a start-up you do a lot more networking, by necessity.

The offers were from other startups or small companies, though... are large companies in Toronto willing to pick up entrepreneurs? I don't know.

There are signicant "Valleys" in Ottawa, Montréal, Vancouver, and in the province of Alberta. I would speculate that the more "relatively" active software companies since dot com have surprisingly been in Quebec. In the past, Vancouver has been home to many gaming companies, and being in the Pacific northwest it is close to Seattle, Redmond, with some direct influences from Silicon Valley.

  EA - Montréal, Vancouver (Black Box & EAC), Edmonton (Bioware)

Toronto's "Valleys" are primarily in the outlying suburban cities: Markham / Steeles Avenue, and Mississauga. Ottawa and Kitchener / Waterloo are fairly distant cities from Toronto. Waterloo is home to RIM and the university: http://www.cs.uwaterloo.ca/

  RIM - Waterloo, Mississauga, Ottawa
  Nortel  - Mississauga, Belleville, Ottawa (2)
  Oracle - Mississauga, Markham, Ottawa, Toronto - Steeles, Toronto (Numetrix)
  Microsoft - Mississauga, Ottawa, Toronto (MSN)
  IBM - Markham
  AMD - Markham
  Apple - Markham

Lets not forget

  Ubisoft - Montreal 
  Softimage - Montreal

And many more of course.

One non tech but awesome company I like is Cervelo (high tech bicycles, as seen in the Tour de France) which started in Toronto by two students from McGill (I'm from Montreal so gotta point that out ;p).

One thing thing that is good about Montreal is the number of talented students from the US who come here to avoid paying expensive tuition in states like MA. It seems that it's mostly the Biotech industry that benefits the most here. Maybe with more investment in the region they could be persuaded to stay and create more tech startups.

There's definitely a lot of interesting stuff happening in Montreal these days. Notably Founder Fuel which is bound to shake things up over the next few years.

Why are you surprised? There is a ton of creative work coming out of QC.

Some more K/W companies, for comparison:

  Sybase - Waterloo
  Maplesoft - Waterloo
  AGFA - Waterloo
  Google - Waterloo
  Desire2Learn - Kitchener
  OpenText - Waterloo
  EA - Waterloo

IBM, RIM and Nortel all have pretty big labs in Ottawa. Not only that, both RIM and IBM are growing insanely fast here.

Having spent the last two years cutting my teeth in the Toronto tech entrepreneur scene, I've come to experience a lot of what I call a "if it isn't broken, don't fix it" mentality, which tends to discount visionary thinking.

Specifically, the standard form for a Toronto tech start-up pitch is to identify "the bleeding neck wound" that some large group of customers have (usually enterprises - bonus points if they are a bank!), and then explain how your solution will come in and save the day for them. This is what Weissman refers to as a "Problem/Solution" story in "Presenting to Win".

This is all well and good, as a hammer without a nail is not much use to anybody, but someone with an actual bleeding neck wound will tell you (if they had the mental clarity) that they are not too concerned about tomorrow, next week, or next year - all consciousness is wrapped up around solving the (admittedly very important!) problem at hand.

The issue is that the scene fixates on this form of storytelling to the exclusion of all others. I was trying to make this point to a member of the Toronto business community the other day by rhetorically asking what bleeding neck wound the iPad solved; the person told me with a straight face that mobile device screens were too small and that laptops were too heavy.

The "build it and they will come" visionary thinking that brought about order-of-magnitude improvements in the way things are done (the automobile, the personal computer, the Internet) is simply, and sorely, lacking in Toronto.

We could really use a strong startup city in Canada, but when your shining example is an incubator whose only features seem to be interrupting people who are working, I don't know that it's the best example. That might impress the Globe and Mail's readership, but it leaves a bad taste in my mouth.

I don't think we need to focus on getting more VCs or more incubators, what we really need is to collect all the startup-inclined geeks in one place.

The people who run Extreme University are well connected with Toronto/SV startups and have quite a bit of experience under their collective belts. Extrapolating one anecdote is silly.

As I see it, the value in programs like EU is that people graduating from places like Waterloo and UFT are less likely to take their talent with them to join a big tech company or hedge fund (more often than not, crossing the border to do so).

Toronto, or any other cities, would you want to be in the shadow of Silicon Valley and always follow whatever the trend is in SV? Or would you define your own city yourself?

There are this... um... communities or group of people... in Vancouver that tries hard to "be like Silicon Valley". At the end of the day, they only speak about "Social this and that" (Social Media, Social Gaming, Social Education, or just put "Social" with whatever comes along next) stuffs that has yet to be seen if they truly offers long-term values or solved problems.

Being away from the Toronto area for a while I don't really have my finger on the pulse of the scene there, but I've only ever seen a couple of companies from the Toronto (or Waterloo) area show up in the "Who's Hiring" threads. Is it that Toronto-based start-ups rely more on networking? Or do they just not hire many people outside of their founders?

Toronto has long surpassed Silicon Valley in the dark side of Internet Marketing such as Acai Berries, Porn and Black Hat SEO.

source?

While we're on this would HNers mind sharing some known start-up names? Personally I'm a regular FreshBooks user

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