March 12, 2012 10:45 AM
Canada’s technology market is underachieving due to a lack of support by the private sector and a securities exchange structure that sets tech entrepreneurs up for failure, according to Jos Schmitt.
Schmitt is CEO of Alpha Group, which was created in 2007 by nine of Canada’s leading financial institutions to increase equity trading efficiencies and to make Canada more globally competitive. Through operational innovations, Alpha Group has developed an alternate trading space on which about 20 per cent of TSX-listed securities are now traded. Not ready to stop there, the company last December received approval from the Ontario Securities Commission to form the Alpha Exchange, which, Schmitt said, will focus on tech and other under-served sectors..
“The real issue is that we don’t have in Canada the ecosystem to build around technology companies to help them be successful,” he said, “while we all know that technology is fundamental to the future growth of our economy.”
Schmitt said Canada isn’t lacking in entrepreneurs, education or innovation, but rather funding and financing and the strong management necessary to grow. Because of these deficits, Schmitt said many early-stage companies with great ideas migrate south, become acquired outside Canada or set themselves up for failure by listing too early on the TSX Venture Exchange to try to secure funding.
Alpha Exchange, expected to launch in April, will take a stricter approach to listing requirements, Schmitt said. Still, he recognizes the need to support early stage companies to get them there, so the organization is working with others to bring together innovators, mentors, marketing and legal experts, investment bankers and other relevant resources. The first of these efforts is the Alpha Exchange Innovation Campaign with Backbone Magazine.
The idea will result in an exchange that acts like an accelerator.
This piece is part of our on-going coverage of innovation in Canada. Please check out our big innovation contest at www.backbonemag.com/Startmeup.
Thanks to our sponsors: Alpha Group, HP Canada, WCIT 2012, Wildeboer Dellelce LLP, Export Development Canada (EDC), RBC Capital Markets, Orion, Ryerson Digital Media Zone, BCTIA Centre4Growth, Ceridian Canada, Financial Technology Partners, OCE Discovery 12.
Lawrence Cummer is a freelance writer with over 15 years of experience writing for periodicals, business and communications agencies. He is former senior writer and editor of the technology trade publications Network World Canada and Communications & Networking Journal, respectively. As well, he has been a senior contributor to a variety of publications.
A frequent writer for Backbone Magazine, Lawrence currently covers a range of topics, including general business, information technology, telecommunications, physical security, occupational safety, and home construction and general contracting. Lawrence can be reached at firstname.lastname@example.org.