The Invention of Waterloo (Canada’s Technology Triangle) | Hacker News Reader

The Invention of Waterloo (Canada’s Technology Triangle)

walrusmagazine.com

112 pointsDanBC72 comments

In my opinion, the engine of Waterloo's success is the university's unique co-op program. UW operates on a four-month rotating co-op system, each student does four months of school, then four months of internships, repeat for the duration of their degree. Many of us land in the Valley, or NY, or London, and bring what we learn back here. Most of my friends have multiple google/facebook/valley start-up internships on their resume by the time they graduate.

I was a little disappointed that they didn't mention our vibrant start-up scene. I write this now from Velocity, the university's start-up incubator, from which four YC companies have graduated. There are Union Square and Sequoia-funded companies in town, and we account for every Google acquisition in Canada, ever.

As a UW alumnus doing a full-time startup a few blocks from UW, I actually don't see much of this "vibrant start-up scene" happening.

This is entirely my fault, which leads me to the question I've been wondering about for a while now:

Where in town would I go to get hooked in?

VeloCity has always been on my radar, but their site is terribly uninformative and doesn't give much of a place to start.

I hang around the university quite a bit but this hasn't gotten me any leads, either.

A lot of stuff are going at the Communitech Hub (i'm in the Velocity Workspace) and the Accelerator Center. There is free drinks & food for startups Jan 11th 5:30 - 7:30 at the Accelerator Center.

Check out Gary Will's blog:

http://blog.garywill.com/

and StartupCampWaterloo:

http://startupcampwaterloo.org/

Come visit DevHouse for some informal tech discussions and presentations: http://groups.google.com/group/waterloo-dev-house

(Originally founded by the PostRank people that have now been acquired by Google and have thus moved to California)

Funny, I came here to say the exact opposite--how the four-months-at-a-time thing doesn't make any sense to me because I've always experienced the vast majority of learning during the 4-12 month range of my employment periods.

University of Toronto (my alma mater) does 18 month coop terms which make marginally more sense to me. I'm generally anti-coop for people who would have no trouble finding a job when they graduate without coop.

> We [Waterloo grads] account for every Google acquisition in Canada, ever.

That's completely untrue. There are plenty of UofT grads acquired into Google, off the top of my head: Bumptop[1] (or even myself[2] if you count that). A bunch more from BC and Montreal, I'm sure. I'd be skeptical of a claim that Waterloo even accounts for a majority of Canadian acquisitions into Google.

[1] http://en.wikipedia.org/wiki/Bumptop

[2] http://venturebeat.com/2011/10/10/google-acquires-socialgrap...

Exactly. Waterloo have had some solid pops, just as everywhere else. Waterloo simply seems to be some of the most visible.

Going by List of acquisitions by Google [1], and from my knowledge of the founders (which is not complete by any means):

Reqwireless - UW founders

BumpTop - UT founders

Zetawire - Uvic / UT founder

SocialDeck - UW founders

Pushlife - UW founder

PostRank - UW founders

[1] http://en.wikipedia.org/wiki/List_of_acquisitions_by_Google

Mhmm, though I'm certain this is not a complete list, and SocialGrapple was listed under USA until I corrected it. :P

>I'm generally anti-coop for people who would have no trouble finding a job when they graduate without coop.

I don't care how good a coder you are when it comes to personal projects, or how well you do in ACM comps, the skills you gain from working on large-scale projects are invaluable to employers. True, the top 5% of CS students might have no trouble finding work anyway, but co-op can turn the next 30% from risky hires into pretty (relatively) sure bets.

Agreed, and I worked on some really cool large-scale projects when I got my first job right out of school.

I didn't have great grades, I didn't have the top scores on coding sites, but I did have some personal projects and I networked, interviewed at a lot of companies, got a few offers and chose the best one.

UW alumnus here, IMO the PEY makes very little sense to both the student and employer. From the employer side, you're committing yourself to 18 months of full-time employment for someone who is an unknown value - I've heard this from multiple employers that the four-month terms are more attractive, since it's not nearly as damaging to make a bad hire. Worst case scenario you let the kid sit around and twiddle their thumbs for the last month or two. Long terms lead to more conservative hiring, leading to less placements overall.

From the student side, co-op isn't just about learning how it is to work in-industry, but also to gain a breadth of experiences and find out where you want to be (or more cynically, where you stand a chance). I had 6 co-op terms spread over 5 companies, and it's been a huge career accelerant - I started off working at a no-name code shop, which paved the way to a brand-name code shop, which convinced someone at a highly algorithmic code shop to take me on for 4 months, and that finally got the Big Boys (Goog, Facebook, Amazon, MSFT, etc) to take me seriously enough to hire me. I simply could not have achieved the end result after graduation if I was limited to only a single co-op term.

The way I see it, UW's co-op system takes your first few years of ladder climbing and compresses that into, well, almost no time at all. I've been able to bypass a great deal of the drudge work right off the bat simply by having good names and solid reviews on my record.

Correct me if I'm wrong but there is no employment obligation for 18 months. You go through the same interview process and you can get fired just like any other employee. This is no different than hiring any other employee.

> Long terms lead to more conservative hiring, leading to less placements overall.

I would argue that less higher-quality placement is a Good Thing.

> From the student side, ...

As a student, your goal is to start building your value and getting proportionally compensated as quickly as possible. Since most value as an engineer is gained well after the first few months of ramp-up you experience at every new job, you end up getting very minimal value out of a bunch of 4 month terms. Not to mention you won't be getting paid nearly as well as someone who is not labelled as a "student".

18 months is marginally better because you're actually growing your skillset, integrate as an important and dependable part of the team, and gain valuable engineering experience. On the other hand, you're still under-compensated and it's trickier to switch jobs half way through if you realize that you've made a mistake.

Finally, my argument is that the most optimal path is skip coop/PEY and find a relevant job right out of school. Even if it's not the best job in the world. You'll be far better off sticking around for 12-18 months, quitting, and getting a second real job, than to do 18 months of PEY and getting your first real job. Both in terms of real valuable experience and compensation.

When big companies look at your "industry experience", the counter doesn't start until you're no longer a student. I've been building and selling software since I was 14, but none of that went into account with HR of big companies when they were deriving the offer for my salary or position. Negotiation and positioning, on the other hand, did make a big difference. But that's another story.

The best value for coop/PEY/internships is to students who lack confidence or experience in finding a job right out of school, or they simply have no idea what they want to do when they grow up or want to drag out their student status for as long as they can. These are all very valid reasons.

I think you'd be surprised to see how much responsibility is given to co-op students after their first or second work term, and how well they are remunerated for doing so. My last work term was in Sunnyvale, came with a $5,000 US a month salary, $1000 monthly rent allowance, $400 a month car allowance, plus a travel allowance for 2 trips home. Upon graduation, most of my class went into "real" roles at their companies, none of this entry level bullshit that usually beckons for new grads who have never shipped code before and can't be trusted to handle anything north of double checking bug reports. Finally, the variety of work experiences helps you find a niche in terms of the types of projects and companies you'd like to be associated with post graduation. It's a giant red flag to see employees move on to new gigs every 4 months after graduation, so even if you hate your job you're somewhat obligated to stick around for at least a year to prove you're capable of fulfilling a "commitment". Why not start off doing something you already know you'll enjoy, with people you've worked with before, and a pay cheque that gives you proper credit for what you've already proven you can do?

There's no single correct answer here, because each person operates under unique long-term goals.

If your goal is to build a large business network, then -probabilistically- more jobs is better than fewer. By virtues of UW CO-OP, whenever I meet someone new in silicon valley, very frequently we have mutual friends.

What does an 18 month co-op give you that graduating earlier and starting work doesn't?

The thing I liked about 4-8 month co-ops at UW was that I didn't necessarily know what I wanted to end up doing. This way I got to try working in a whole bunch of situations to find what I ultimately enjoyed most. I did co-ops in southern California, Silicon Valley, NYC, and around Canada. I worked for startups, big companies, and even the government. I hopped around in different industries too: semiconductors, fuel cell research, mobile devices and internet. Ultimately by the time I graduated I had tested the waters of industry in a variety of ways, gained a ton of life experiences, gotten really good at having a big impact at work in a short period of time, and had an offer to return full time to my last (and favourite) co-op employer.

See the response I gave to potatolicious. Because you didn't know what you wanted to pursue and wanted to sample around, I'd say you're within one of the cases where coop is a good value.

Another issue with the 18 month coop is that, at least from the UW students I speak to, most go with startups. All of the UW students I personally speak to are receptive of doing a coop with a startup.

It is significantly harder for startups to commit to 18 months of anything. Having any form of structured work environment, guaranteed capital, or even if they will still be around.

On the flipside, I find less of the UT students are willing to coop with a startup vs. a larger firm.

(This is just my experience, so chalk it up how you like. Clearly, it may not be indicative of the students as a whole).

Before graduating from Waterloo, I had the opportunity to work in three different countries (Canada, USA, Japan), on everything from web services to embedded C. While I was a good student, and I doubt that I would have had any trouble finding a job with or without co-op, getting the breadth of experience was incredibly valuable - this would be something much harder to get after graduating.

I generally dislike competition of school brands (ie. Waterloo vs. Toronto), because I am fairly certain that education is 95% work ethic. The co-op program I firmly believe is exceptional, however.

Alright, I am convinced that Waterloo students get more joy out of doing four four-month jobs than Toronto students get out of doing one eighteen-month job.

What I'm not convinced of is the resulting value-add to the student's career. The way I see it, the best things you can do to your career, in order of bestness:

1. Graduate as quickly as possible while freelancing summers, get the best job you can, quit after 18 months and get another different job to experience some diversity.

2. Take a year off in your 3rd year, work at a startup, then do the rest as #1.

3. Do an 18 month PEY term while being a student, get as much valuable experience out of it as you can, then graduate quickly and do the rest as #1.

4. Do four 4 month coop terms while being a student, experience as much diversity as you can, have as much fun as you can, then do the rest as #1.

5. Take a year or two to travel while being a student, have as much fun as you can, start collecting a jar of wisdom, then do the rest as #1.

> "quit after 18 months and get another different job to experience some diversity"

You really can't sample very much after you graduate. Let's be honest, in almost all places in this industry, hopping around every 1-1.5 years looks ugly after a while. You can pull it off once or twice before it starts reflecting in your interviews.

That's the point other posters are making - more, shorter co-op terms is basically the penalty-free way of job-hopping and sampling everything. It's also a way of rapidly expanding your professional network and filling it with people who can vouch for your work.

To be clear, unless they've changed it recently it is six four month co-op terms, not four. Also to be clear, students do frequently spend two co-op terms at the same company.

If you're really ambitious, nothing will hold back your career. An ambitious person will use co-op for exactly #1 and #2. A lot of (or at least many) people spend their six terms at six different start ups in NY, SF and other technology hubs, and meet a ton of people. The nice thing about being a student is that everyone just wants to help you, and you get a heck of a lot of business cards.

The reality is that there also a lot of people who are smart and get things done, but don't necessarily have the motivation or are too risk adverse to really reach out there and try things. Or some people still have a sense of loyalty, and once they've accepted a job they don't want to jump around every 18 months. Or after they graduate they are ready to start a family. The beauty of co-op is that it lets smart people experience a lot without needing that career ambition, and it exposes a lot of people to things that they would otherwise not get the opportunity to experience. This also inspires entrepreneurship, as people can tour software companies (and not software companies!) and really see what culture is like, what they like, what they don't.

Internships are great too, but the risk of an internship is that you end up with a bad placement. I had a friend who got a job as a tester (they lacked the self confidence and interview skills for something more), and that shattered them - they went from timid yet smart computer scientist to burned out in the 18 months (I am sure that there are people with great internships too). With co-op, there are bad placements, but you get many chances to get it right.

I can only speak for myself, but my 4-month coop terms are the only reason I managed to graduate. I studied computer engineering at UW, and it was more intense than anything I've had before or after university. I definitely would have burned out by third year without my coop terms.

It also helped that coop paid for everything: tuition, rent, food, etc. (Although, I don't smoke/drink/do drugs/drive/have expensive tastes...) I graduated with a net (albeit tiny) profit instead of the massive debt most students seem to end up with. An 18-month placement probably would have been financially equivalent, but I would have had to take on debt before my third(?) year to benefit. Judging from my friends in other programs, having money troubles or taking on jobs while in school is extremely stressful.

(Aside: One could argue that since I admit to struggling to get through without frequent rest that I am under-prepared for work, but having been in a full-time position for some time now, I can see that university was artificially intense. Nobody in "real life" expects the same rate of output. Although, now I feel somewhat under-challenged because I had just managed to get used to the amount of effort required to do well by the time I graduated!)

My error, I believe this was true at one point, however. We do account for the majority, however. Fraser's post below me gives a near comprehensive list.

Waterloo grad here - The 4-month co-op is the rule, but that doesn't mean the school isn't flexible. There were placements in Japan that required 8 month co-op terms (you just switch "streams" when you get back to school and can still graduate on time). I did a 12 month co-op in Japan and they had no problem with it. Great experience.

I don't know where you're getting this 18-month number from. The maximum co-op term on PEY is 16-months, and a large number of people have opted for 12-month terms. They have also accepted terms as low as 8 months in some circumstances (lay-offs, overseas, other employment, etc.)

"I've always experienced the vast majority of learning during the 4-12 month range of my employment periods."

I've had 4 4 month co-op terms and 1 12 month co-op term as well as 5 full time jobs since graduation. In every single case I learned more in the first 4 months than I did subsequently.

I went to Waterloo as well and absolutely loved the 4-month co-op terms and would have hated being limited to a single 18-month term with a single company. You get to try a little bit of everything. I did big companies (BNR, NT in Toronto), a smaller Toronto startup and mid-size (Novatel in Calgary) and after freezing my a in Alberta for a winter term went to southern Brazil for my next two terms.

Totally agree with this. By the time I'd graduated I'd spent 4 months at a large communications company, 4 months tutoring college-level math, 4 months coding in an astronomy/astrophysics lab and 4 months writing medical physics code at a privately funded research institute.

Getting to experience 4 different work environments/subjects (in 4 different cities) was much more valuable to me in the long run than it would have been sticking at one place for 16-18 months. Those varied experiences also look great on a job/grad school application.

Many of the programs do (did?) allow you to go for an 8month co-op as well.

The tragic thing is that software companies in Waterloo don't pay that well. Microsoft, Google, Amazon, Facebook, etc. are offering new college grads around $100k salary, while companies such as RIM and OpenText in the Waterloo region pay maybe $60k, so all of the talent in the region leaves. Having gone through Waterloo's co-op program, I found that Canadian software companies tend to be very management heavy, which is not what an ambitious college graduate is looking to get into. There is a lot of potential, but there are some big cultural problems that I think need to be fixed.

The salary is scaled to the cost of living. Even Google doesn't pay the same if you're working in Mountain View or Waterloo or Australia.

$100k base salary in Waterloo adjusted for cost of living would be like an $180k base salary in Mountain View. (Disclaimer: From personal experience, don't have a citation on the exact ratio.)

I suspect people leave to Silicon Valley for the opportunities, tech culture, and weather far more than the salaries.

Your point is valid in theory, but having spent the last 3 years in the US and keeping in a keen eye on the market continent-wide, it just doesn't bear out in reality.

I started off after graduation in Seattle, where the living costs are downright identical to what you would find in Vancouver or Toronto - except I was making $100K+ total comp. Compare this with the $50-55K offers I was getting from Canadian companies, and it was a complete no-brainer.

The gap has only widened - I'm now in SF making over double what my going rate in Canada would be. The cost of living is higher (well, mostly just the rent, everything else is similar), but it doesn't even come close to canceling out the raw pay difference.

But sometimes the pay is a red herring - I know a lot of Canadian expats in the USA who would love to go home, and many are willing to take substantial pay cuts in exchange for Canadian QOL, including myself. In fact, some of us have actually investigated this option thoroughly, and the ugly truth is:

There just aren't that many interesting, challenging jobs for programmers in Canada. It's a country full of code sweatshops and satellite-office monkey labs. Interesting, fulfilling, high-impact jobs are few and far between, and incredibly hotly contested where you do see them. Compare with being in SF, where someone practically begs me to go work on their interesting, world-changing problem every week. So in order for me to go back to Canada, I'd not only have to take a >50% pay cut, but also resign myself to ye olde cubicle and TPS reports. Entirely unacceptable.

We're a tech startup in Vancouver. If you're interested in coming back to Canada, please look us up. We've build up our company to be very much like what you can find in the US (i.e. ownership, high quality of talent, cool things to work on). We're always actively hiring, and we compensate very fairly, since we know we're looking for the best hackers in the world. :)

Ya, I know this sounds like a pitch, but if anyone in the US is thinking of moving back to Canada, please contact us. We've written about our reasons for opening up our primary dev shop up here, and one of them was specifically for the really great devs that wanted a cool place to work in Canada.

Our website is www.athinkingape.com It might look like a social games development shop, but it's actually much more. ;)

> $100k base salary in Waterloo adjusted for cost of living would be like an $180k base salary in Mountain View.

Um, no. Even though SV is a high-cost location in a (relative to the U.S.) high-tax state, personal income taxes are still substantially higher in Canada. Housing might be somewhat more in Waterloo than in SV, but the net take home at the end of the year would still be higher.

Assuming you're married and can file a joint tax return w/ your spouse, the U.S. tax advantage goes up even more.

There is no question that if you want to make a lot of money in tech, the U.S. is still the place to be. I say this as someone who has lived and worked in Canada, Southern Californian and now Australia.

Actually, here are the 100k tax rates for Waterloo, Ontario, Canada vs. SF, California: Waterloo:

26% Federal + 11.16% Provincial = 37.16% http://www.cra-arc.gc.ca/tx/ndvdls/fq/txrts-eng.html

San Francisco: 28% Federal + 9.3%x(0.72) State = 34.7% <-- (9.3%x0.72 because you can deduct your state taxed amount in certain scenarios)

http://www.efile.com/tax-rate/federal-income-tax-rates/ https://www.ftb.ca.gov/forms/catxrate_exmpt07.shtml

Once you get above 174k/year, it's sill similar, with:

Waterloo: 29% Federal + 11.16% Provincial = 40.16%

San Francisco: 33% Federal + 9.3%x(0.72) State = 39.7%

So at 100k, Canadian taxes are very slightly higher higher, and is almost even at 174k.

If you're working at a startup, Canada may even be more advantageous because of how capital gains taxes are treated on privately held CCPC's. Also, you have health care. :)

Except that you deduct your state/local income tax from your federal income tax.

Edit: Your statement that you can deduct income tax is True IF you don't take the standard deduction. Basically in your deduction, you can choose to take the standard $5800 deduction, or deduct the total taxes you paid for california (at $100k, it is only marginally over $5800). At over 200k, you are likely to get hit with AMT, so the deduction would be limited.

I've updated the tax rates above to be more indicative of the adjusted rates in the best case scenario, but California vs. Canada is still VERY close.

http://www.irs.gov/publications/p17/ch22.html

Yup, this is true. I updated my posts to reflect this. However once you get above 200k range, AMT starts to kick in and you can't deduct the full amount.

Health care is a given in the U.S. if you're making that kind of salary so for me it was always a non-issue.

Try re-calculating the tax rates if you have a non-working spouse (as was my case since I was on a work visa) and you're significantly better off in the U.S.

"If you're working at a startup, Canada may even be more advantageous because of how capital gains taxes are treated on privately held CCPC's"

This is huge. Read as "the first $750K of your startup windfall is tax free".

As a former Waterloo co-op (and founder of a YC company), I'd have to say that the 4 month co-op program added a LOT of value. I learned more in each of those 4 month co-op terms than each of my school terms. Additionally, from all my interviewing experience (i.e. interviewing for full time hire's), those that come from a co-op program (any co-op program, even UofT's) are way better prepared and have much more practical knowledge.

This is a core reason why we still recruit heavily in Waterloo, for both co-op's and full-times. In fact, we're going to be in Waterloo on January 19th, 2012 for a tech talk with YC and a number of other YC companies. Please feel free to drop by if you're in town.

have a link for the event?

Yup: http://www.athinkingape.com/events/

Hope to see some of you there.

awesome, thanks

If you are interested in hiring Waterloo co-ops at your company, they intern in four month intervals year round: http://hire.uwaterloo.ca/

Here is a good guide for hiring UW co-ops: http://barbaramacdonald.ca/post/11153941771/how-to-hire-the-...

Written by my cofounder

I'm a recent UW grad and though I think there is huge value in the co-op program I think the main driver is the University's tech-driven culture. Just go to Davis Center (Waterloo's tech library) for an hour and it will be hard not to get swept up in a discussion about new technologies, innovative new applications and interesting points of view. Even the humanities curriculum has a tech twinge; I graduated with a BA in Economics being able to code concisely, and use an arsenal of open source tools to solve problems the are discounted as being "too mathy/techy" by other economics programs.

You are going to see a whole lot more creativity coming out of Cambridge as well. The architecture program has created some of the most talented designers in the world and the admin are doing some great new things to have students apply those skills to UX.

I'm a recent alumnus of the UW Architecture program. I know the faculty there are pushing hard to incorporate emerging technologies into the core undergrad curriculum and many of the graduate students there are doing really interesting work in computational design and UX.

Additionally I can't say enough good things about the co-op program. While I was there every single one of my classmates got a placement every term at a firm within our industry. The economy was better then, but most of us had our pick when choosing what city we wanted to work in abroad. And this is on top of the compulsory term at the school's Rome studio in 4th year.

Some of my classmates have gone on this year to create non-tech start-ups of their own, such as Our Paper Life (http://ourpaperlife.com/) here in Toronto and Factory Five (http://www.wearefactoryfive.com/) in Shanghai.

I wouldn't trade the education and the diversity of my experience there for anything.

One thing nobody has mentioned is also that most Waterloo students come out of there with more money than they had going in. No crippling student loans to deal with. Co-op terms aren't just great experience they also pay quite well.

(Unless things have changed, I graduated in 1993 and this was the case back then)

Tuition was de-regulated in the 90's and went up 15% a year through most of the 2000's. I'd say it's doable but not a given.

I graduated in the mid-90s from UW and I can say from my classmates and friends from a variety of faculties most had $20k+ loans to repay (though that first year after a lot was forgiven by the govt program).

At that time, in the mid-90s, the majority of students weren't in co-op at UW. Even those in Math, CS, Eng, Sci and Actg who did get co-ops usually it was at breakeven or a slight net positive for the experience, given the extra expenses of travel to Ottawa, Toronto or other cities with accommodation, plus 4-month rentals in KW were more expensive than 8-month.

UW engineering tuition is through the roof now. It's so bad now that I'm not sure what I would've done had I had the unfortunate luck of being born 3-4 years later. Breaking even with co-op is out of the question for a lot of students, though it still helps a lot.

After all, without co-op, for most UW engineering programs you're now looking at $40-45K tuition + living costs + supplies/books... A $80-90K loan is not at all out of the question.

Is that per year or for the whole degree? I was living in Waterloo and the students I talked to were paying $5-$15k a semester. To put that in perspective for an American, at RIT I was paying $40k a year + all of those living expenses.

That's for the whole degree. Waterloo engineering is $10-12K per year at this point for just tuition. Stack living costs on top...

Definitely not as bad as the Americans have it, but education is starting to approach unaffordability, and it'd be a shame if we had an American-style system in Canada.

But there's no venture capital in Canada so it's nearly impossible to build a large tech company. Most successful Canadian startups sell out early because they know they'll hit major roadblocks. No capital plus a monopolistic telecom industry backed by government makes for a particularly hostile environment for small companies. Example: Kik got sued by Research in Motion IMMEDIATELY after receiving venture funding. The Canadian government actually encourages this type of anti-competitive behavior and does literally nothing to support any kind of small-business tech innovation. Any "technology innovation" tax incentives are geared toward saving oil companies billions of dollars per year, and do absolutely nothing to help small businesses.

Canada is an absolutely horrible place to do a technology startup, I do not recommend it, this article does not change this fact.

What a ridiculous statement. Don't get me wrong, there are a lot of challenges that entrepreneurs encounter when starting or scaling a business here, but it's time to stop using the crutch of VC/Government/Telecom interference to support the assertion that Canada is "an absolutely horrible place to do a technology start up. The bottom line is that if you still think this is the case, you haven't been paying attention to what's been happening over the past few years in this country. Do the names Fixmo, Shopify, Achievers, Accedian Networks or BeyondTheRack ring a bell? How about HootSuite or FreshBooks? A Thinking Ape, Vidyard, Allerta, Upverter, Enflick, GoInstant, Wave Accounting, Well.ca, Chango...the list goes on and on - all world class companies run by entrepreneurs who spend their time executing, not complaining. Radian6 and Q1Labs sold for almost $1B combined - is that large enough for you??? Last time I checked none of those companies were being sued by RIM, being squeezed out of SR&ED credits by oil companies or being held in check by Rogers/Bell/Telus. We (iNovia Capital) have even funded some of them, and are proud to stand behind them and every other entrepreneur in Canada who are working their asses off to prove you wrong.

I am speaking from my personal experience. None of the Canadian investment firms, or incubator even replied to my emails, let alone give any reasonable valuation. The Canadian YC-copycat incubators seem more like vultures that scoop 25% equity for $50K in seed funding which is pretty ridiculous compared to what you can can get in the US. I was denied SR&ED and am currently in the process of receiving venture capital and moving my startup, and all the technology I've developed, to California far away from this abysmal environment.

I think you need to distinguish between the types of startups that are encouraged in Canada and in the US. For example, the MaRS (Medical and Related Science) Discovery District (http://www.marsdd.com/) is the largest incubator of its kind in the world.

One bad experience should not tarnish an entire national ecosystem. There are incubators like GrowLabs and FoundersFuel who offer terms that are on par or better than YC, and there are investment firms that have invested hundreds of millions of dollars into Canadian startups over the past few years, and SR&ED claims seem to function smoothly for all our portfolio companies. I obviously don't know the details of your particular case, but don't mistake it for the status quo.

Well that's nice for them, but for me I’ve received a much warmer welcome from Silicon Valley, including first class flights, an office, and funding for several years of development.

karamdeep perhaps everything looks great because you are on the other side of the table... and not creating a startup yourself...

Canadian VCs suck, no question. That's why most good Canadian start-ups have investors from the valley.

Most Canadian start-ups that have investors from the Valley also have investors from Canada.

This is true, but they're usually local angels, not VCs.

agreed! York Angeles, ONE Network et al, 25% for $25k... what a joke. Not to mention the lack of investments in Consumer-centric startups... Valleys the way to go.

Hi there. While I agree with some of your points, i.e. issues with certain large companies being anti-competitive in the startup environment rather than being supportive, and the fact that the tax incentives offered could be better structured to be more accessible to technology startups, I still think Canada is a great place to build a company. Why? Well:

1. Canada does have great tech talent. Finding them is a bit more difficult, but talent retention is much better. And if you reward your employees well (i.e. competitively with any other company out there), you can attract world class talent.

2. Building a great company does not necessarily mean raising a huge VC round. In fact, if you can build a business that is growing quickly without the need for VC, they'll come looking for you. One thing that some people get hung up on is that you absolutely need to get funded to start a company. That's not true at all. Although, when the time does come to raise money, most US investors are actually comfortable with investing in Canadian companies.

There are a few things I do notice though. Canadian culture is a bit more conservative (i.e. less willing to take big risks, which also explains a bit of the lower valuation). It makes a bit of sense, since most of the larger industries are around 'traditional' sectors, like natural resources and finance. But this is changing. And as more and more successful tech companies emerge, the startup community will only get stronger.

Also, the tax incentives are well intentioned, however the way they're structure has been a 'one size fits all' approach. The rules put in place make sense for some industries (e.g. medical R&D), but make it a bit inaccessible to tech startups without a lot of effort.

> "Finding them is a bit more difficult, but talent retention is much better."

As an employee this seems alarming to me. My impression of the Canadian tech scene is that you've got a small number of innovative companies with great work environments amidst a sea of sweatshops and incredibly mind-numbing code outfits. When your alternative is that, of course retention is better.

For an employee it means you've essentially got them over a barrel. Don't rock the boat, don't ask for too much, because it's this way or work at some soul-sucking enterprise shop on Bay St.

I'm not sure I can ever return to an environment like that, where my employer holds all of the cards and I hold practically none.

I'm sorry that you feel that way, but let me clarify that statement a bit. Finding them is difficult, not because people don't want to work here, but Canadians are usually the ones more willing to work at Canadian companies, so the overall tech talent pool is a bit smaller to work with. In the US, you've got people from all over the world vying for positions. Canada has to present itself as a technology hub to attract more international talent.

Retention is better, not necessarily because there is a lack of innovative companies. In fact, there are definitely a a number of great companies to work for in Canada that aren't the sweatshops that you mention (and I would like to count ours among the innovative and great places to work).

The retention aspect is more about the mentality of people in Canada when they join a startup. In silicon valley, there are A LOT of companies, and every week it seems like there's some hot new startup. Given that, a lot of tech people there have the mentality of hopping from company to company just to maximize their own short term gains. We personally don't feel that that type of employee behavior is healthy.

Compare this to another area in the US which has a healthy tech scene, but WAY better retention. Seattle. There are definitely a significant number of tech companies there (Amazon, Google, Facebook, MS, etc.) with great working environments. But the reason retention is better there is because it's a bit further away from the silicon valley hype.

Similarly, in Canada (Vancouver), we try to offer something very similar. Great work environment, competitive compensation and a general good tech place to work. As employer's, we will NEVER hold all the cards (heck, all our guys could go get a job at any tech company in the world, including silicon valley). It's just that the people we've managed to find up here have been more focused on long term growth potential than short term gains.

I'm always wary of the sentiment that "good-fit" developers at location-foo or company-bar don't think it's [healthy,smart,reasonable] to [optimize,maximize,consider] "short term" gains. Across the whole industry, especially if you discard the few gigantic outliers like Facebook and Google (but really either way), long-term loyalty to startup-trajectory companies is rarely paid off. You take the gains from equity and spread them across the years of employment and end up with a track record of bonuses that look good (only very rarely "great") but have a built-in survivorship bias that hides the extreme risk the developer took relative to other options.

Personally, I think the pendulum has swung too far in the "invest yourself with your company" direction, too far away from the "pay attention to your own bottom line, because you're the only one who will" direction. Developers should be more conscious of their short-term bottom line, not less. Developer interests are almost never aligned with that of a company's owners.

Like it or not, if you're not willing to move out of town on a moment's notice for your next job (ie, if you're over 27 or so), working in a market with fewer attractive employers is worse than working in a market with lots of them. It is a real disadvantage. It's not an emotional thing and it's not something you can paper over with mindset.

(Incidentally, all the things that make taking a job in a "backwater" market make starting a company in a backwater market more attractive. Talent is sticky. Every major market, whether it's first tier or third tier, has amazing talent that can't move because nobody is going to relocate their 4th and 6th grader kids to another state for an employee #8 role at a startup.)

All that said, Montreal is a beautiful city. I'd look for reasons to work there if I could.

This is, for whatever it's worth, exactly what the tech scene in Ann Arbor Michigan was like, and I'm reasonable sure the management at the (relatively enlightened) company I worked for in A2 knew it.

Hilariously enough, I'm currently working in a satellite office of a company based out of Ann Arbor Michigan... I'm pretty happy with how things are run so far, but there's always the thought that maybe things are only great because of how mobile I am, and the worry that if I make myself immobile things will take a turn for the worse.

I've seen it happen to people more talented than I am...

Reply on news.ycombinator.com