Why Startups Should Choose Canada Over Silicon Valley • Hacker News Board

Re: Why Startups Should Choose Canada Over Silicon Valley

#51

Post by dquail » Tue, Apr 09, 2013, 1:49 AM UTC

amackera wrote: post #50

dquail wrote: post #25

Earlier quoted context omitted.

The great Canadian startups I know don't look incredibly highly of government programs (namely SR&ED and IRAP). They're great, but can be distracting, taking you away from building value in your startup and into filling out meaningless forms. That said, free money is free money, and I've seen successful startups (that aren't politically connected) leverage these programs without being distracted.

We leverage both SR&ED and IRAP at our company, but it's difficult. It is a huge distraction, taking valuable time away from actual research and development. They requirements are way too stringent in my opinion. There should be tax credits or funding specifically for startups, especially startups still trying to find their product/market fit in the early stages.

That's consistent with my experience. Not only onerous paperwork; but very poor advice wrt how to build a business. This is federal money not intended for high risk high reward opportunities. The advice I got was "you should focus more on a niche instead of a mass market. Your chances of success will be much higher"

Re: Why Startups Should Choose Canada Over Silicon Valley

#52

Post by dquail » Tue, Apr 09, 2013, 1:52 AM UTC

ryanpers wrote: post #40

vecinu wrote: post #17

Earlier quoted context omitted.

I'm glad you had a great experience visiting Toronto and experiencing the startup culture there. I'm sure I'll see the area totally different when I return from SF and I may just find a role that I fit in very well. I totally agree with you about the over inflated hype currently in the valley. While this leads to a lot of failed startups and 'wrong' ideas being funded, I think it's still a healthy ecosystem for promo…

The hype and "over-investing" is deliberate. Why? Well, let's face it, the most revolutionary things have all started sounding silly and insane. People will buy things over computers without having actually seen or touched them? Humans will fly? Will travel to the moon? Everything is actually well modelled by equations that imply that everything is a wave and has probability it exists? So just because YOU think it so…

Yes, a lot of big companies were once ridiculous ideas. The founders where tenacious, and would have succeeded regardless of any synthesized hype. I argue there's more companies hurt because of this than there are that thrive.

Re: Why Startups Should Choose Canada Over Silicon Valley

#53

Post by dquail » Tue, Apr 09, 2013, 1:56 AM UTC

jsingleton wrote: post #22

vecinu wrote: post #5

I have a few problems with this article, namely the comparisons drawn between The Valley and Canada. I am currently a Canadian citizen, working in San Francisco at a company that moved from Vancouver many years ago. The author seems to be comparing the Bay Area to the entirety of Canada. Canada is not a small area, a city or a state. It is an entire 'continent' spanning multiple provinces with very different laws and…

Agreed. A lot of people seem to be mentioning Toronto (never been) but can anyone comment on the tech/startup scene in Vancouver (loved it but it seems very small)?

Vancouver has exceptional talent, a shared time zone with the valley, and ski hills minutes away. Grow labs and launch academy are also seeding and launching legit companies. All this adds up to a pretty strong scene. I'm not aware of investors stoned Boris and Bdc ... But again, SV investors aren't shy to invest globally. In fact, many including Dave McClure, and our former investors (tandem entrepreneurs) focus on these markets.

Re: Why Startups Should Choose Canada Over Silicon Valley

#54

Post by dquail » Tue, Apr 09, 2013, 2:01 AM UTC

3pt14159 wrote: post #24

strebler wrote: post #20

Rose coloured glasses. You want to startup in Canada? Either a) have access to network with money, or b) bootstrap like there's no tomorrow. Investors in Canada have an appetite for risk somewhere in the neighbourhood of "mutual fund vs GIC" levels. For someone with Silicon Valley connections, fine it could work, but this is not good general advice. Even iNovia, which is probably the most forward looking VC in the co…

This man here speaks the truth. Without revenue, it is easier to get a $30k grant than it is to find an angel investor willing to invest for the same amount. (Source: I raised a $30k grant in about 3 meetings and 5 hours of paper work. I also spent about 6 months with two idiot "angel investors" from Ryerson Angel Network when I was young and dumb and didn't close a dime. One guy said he wanted to invest but sheepish…

Why does everyone seem to think you need to raise money from Canadian investors? We raise from US investors in our first startup. We were Canadian nobodies with nothing but a beta as a pitch deck. Yes, it's easier to raise if vc's can drive down the road to visit .... But it's a lame excuse to use.

Re: Why Startups Should Choose Canada Over Silicon Valley

#55

Post by dquail » Tue, Apr 09, 2013, 2:10 AM UTC

mahyarm wrote: post #42

ultrasaurus wrote: post #12

One thing that Canada has in it's favour is that for competent CS graduates, you're competing with stultifying companies rather than companies in the SF bubble. PagerDuty is one of those companies that I expect Canada would've been happy to keep, and we're loving it in SF, but we're fighting with a lot of similar companies for people. This year, we opened up an office in Toronto, and even though our standards are the…

But can't Canadians move to the valley too with the TN visa?

Us Immigration sucks. But if you're a talented engineer ... You can get down there. But there's plenty of Canadians that would to prefer to stay.

Re: Why Startups Should Choose Canada Over Silicon Valley

#56

Post by schiang » Tue, Apr 09, 2013, 2:11 AM UTC

> At the end of the day, my advice to Canadian startups is to stay in Canada

I think this can apply to many cities outside of the silicon valley bubble.

Re: Why Startups Should Choose Canada Over Silicon Valley

#57

Post by dquail » Tue, Apr 09, 2013, 2:17 AM UTC

ultrasaurus wrote: post #12

One thing that Canada has in it's favour is that for competent CS graduates, you're competing with stultifying companies rather than companies in the SF bubble. PagerDuty is one of those companies that I expect Canada would've been happy to keep, and we're loving it in SF, but we're fighting with a lot of similar companies for people. This year, we opened up an office in Toronto, and even though our standards are the…

I run an internship program placing Canadian interns in the valley, and have interviewed plenty of students from US schools. There's some amazing students coming out of Waterloo and UBC in particular. Waterloo grads are as competent and hungry as grads from MIT or Stanford. I've been amazed with them.

Re: Why Startups Should Choose Canada Over Silicon Valley

#58

Post by JVIDEL » Tue, Apr 09, 2013, 2:17 AM UTC

akg_67 wrote: post #19

vecinu wrote: post #5

I have a few problems with this article, namely the comparisons drawn between The Valley and Canada. I am currently a Canadian citizen, working in San Francisco at a company that moved from Vancouver many years ago. The author seems to be comparing the Bay Area to the entirety of Canada. Canada is not a small area, a city or a state. It is an entire 'continent' spanning multiple provinces with very different laws and…

"I don't see the same enthusiasm towards tech and startup in Toronto that I see here in The Valley." Having tried establishing my startup in Toronto before, I fully agree with your statement. I know at least 6 more people who got frustrated trying to start tech companies in Toronto/Waterloo and finally gave up and moved to US/valley. Most Canadian govt funding programs for startups (I tried) are for politicians to ha…

Those are terrible news for me since we were considering moving to Toronto, and what you mention is exactly what I was afraid of.

Now that nepotism sounds more like something that happens where I live, funny that there's the same cronyism over there.

Re: Why Startups Should Choose Canada Over Silicon Valley

#59

Post by brc » Tue, Apr 09, 2013, 2:18 AM UTC

dquail wrote: post #51

amackera wrote: post #50

Earlier quoted context omitted.

We leverage both SR&ED and IRAP at our company, but it's difficult. It is a huge distraction, taking valuable time away from actual research and development. They requirements are way too stringent in my opinion. There should be tax credits or funding specifically for startups, especially startups still trying to find their product/market fit in the early stages.

That's consistent with my experience. Not only onerous paperwork; but very poor advice wrt how to build a business. This is federal money not intended for high risk high reward opportunities. The advice I got was "you should focus more on a niche instead of a mass market. Your chances of success will be much higher"

Same experience for me when trying to access government funding programs.

For one, the people you are talking to have zero experience in running a business, let alone a new one. They do have, however, extensive experience in drawing out meetings, death by powerpoint and producing forms in triplicate.

The grants generally come with a lot of reporting and strings attached, and generally require very large investments to be worthwhile.

We can get R&D tax concessions which are quite useful but the amount of money you need to spend in order to qualify excludes any sort of early-stage tech venture.

The entire process was a giant waste of time for me, and I get the impression they are political operations rather than genuine ones. In fact in my research I found out that infrequently do the funds ever actually give out all the money, but a good portion of the advertised spend (ie, $x00 million in new company grants) actually goes to the departments that spend their days handing out the money.

Not to say that the guys weren't genuinely trying to be helpful, they were. But they are hamstrung by their own reporting requirements and lack of understanding as to what people need money for, and when they need it.

My ultimate conclusion is that special economic zones with, say, 10 years of a tax holiday for a new company starting within that area would be a much better way to go about things. That would spur local investment and employment, have a specific end date and be much easier to administer. It would also favor bootstrapping as opposed to trying to capture large starting funds, which IMO for the outside-the-valley world is a better way to go.

Re: Why Startups Should Choose Canada Over Silicon Valley

#60

Post by wmoxam » Tue, Apr 09, 2013, 2:25 AM UTC

nasalgoat wrote: post #41

Being in Canada also means flying under the radar, which can be a good thing for long term viability of your product. My company does 100x the traffic of our nearest competitor but you'll never see a TechCrunch article about us, since we're in Toronto. So there's no pressure for overnight success and you can work diligently towards making a better product instead of meeting unreasonable expectations.

Being in Toronto has nothing to do with seeing (or not seeing) a TC article about your company.

TC covers plenty of Toronto based startups, including the last two that I've worked for.

Also, seeing your company on TC isn't all that useful anyways...