Communitech‘s five-year digital strategy is producing big results after just three years, according to a report card released earlier today. In mid-2009, Waterloo Region-based Communitech set out to:
- Support the creation of 100 new digital media and mobile computing companies
- Help generate 2,000 new jobs within startup companies
- Help create and retain 5,000 new jobs in existing technology companies
- Attract more than $100M in equity investments to digital media and mobile companies
The results from 2010-2012 are striking:
- 863 new startup companies have been created since 2010, generating more than 1,600 new startup jobs
- Close to 4,000 new jobs have been created in existing tech firms – Waterloo Region’s tech & digital media cluster has close to 1,000 companies that generate more than $30 billion in annual revenue
- Client companies have attracted $350 million in equity investments
Recent work with Deloitte Consulting has pegged the 2012 economic impact of Communitech’s digital strategy at more than $14 for every $1 of public investment (measured in terms of GDP), and the cost per job created at just $3,800. Deloitte also carried out work to quantify the collective impact of Communitech’s small and mid-sized client companies, estimating more than $900 million of economic impact, which encompasses client revenue, capital raised, new job wages and client deal flow.
Other follow-on impacts of the strategy include the longevity of startup companies in the Communitech network: 83 per cent of startup companies in the Waterloo Region ecosystem are still in business after five years – far outstripping the industry average of 45 per cent in other global locations.
Communitech CEO Iain Klugman points to the results as evidence that public and private sector investment in Communitech’s strategy are paying huge dividends. “We set out to build a world-class commercialization centre at the Communitech Hub, and to connect that centre to a world-class network through the Canadian Digital Media Network,” explains Klugman. “And the economic impact of those investments is really powerful for Ontario and for Canada.”
Both the Province of Ontario and the Government of Canada are key investors in Communitech’s digital strategy. “The Communitech Hub’s start-up coaching, collaborative R&D and outreach activities are helping Ontario strengthen the economy and create jobs,” said Ontario Minister of Research and Innovation, Reza Moridi. “Communitech is a stellar performer – for every dollar Ontario has invested, Communitech has helped its clients raise $13 in investment equity. We’re pleased to be a partner in advancing Communitech’s digital strategy.”
“Communitech’s efforts are connecting entrepreneurs to capital and paying dividends for Canada’s digital economy,” said the Hon. Christian Paradis, Canada’s Minister of Industry. “Results like this are exactly why our Government increased our support for incubators and accelerators in Economic Action Plan 2013. We remain a proud partner in their efforts to grow, compete and create jobs for Canadians.”
Entrepreneur John Baker, CEO of Desire2Learn Inc., credits Communitech’s support for helping his company to grow. “Communitech has been with us every step of the way,” said Baker. “If I look back to when we were two people, we were already being put in front of the whole community to give a five-minute pitch on what we were up to – and this was before there was the massive startup culture that exists in the community today.”
OMERS Ventures CEO, John Ruffolo, calls Communitech the model for tech ecosystem development in Canada. “They support companies throughout their lifecycle, connecting them with the capital and talent that are critical to growth. Communitech’s strategy is bringing huge value to Canada.”
Academic partners include the University of Waterloo, Wilfrid Laurier University and Conestoga College. Industry partners include Google, BlackBerry, Desire2Learn, Christie Digital, OpenText, Agfa HealthCare, COM DEV and Canadian Tire, which announced last month that its new innovation team will be headquartered at the Communitech Hub.