Canada and TSX Gain Traction in Silicon Valley
Last week, Michael Kousaie, Head, Business Development (Technology), Toronto Stock Exchange (TSX), dispatched to San Francisco to attend an exclusive meetup featuring chief executives from some of Canada's top early- and growth-stage technology companies (both private and public), senior representatives from large U.S.-based Venture Capital (VC) firms and private equity funds, and other key supporters of the vibrant Canadian technology sector.
Over the last few years, Canada has developed into a hotbed of tech entrepreneurship and many new technology and innovation companies are turning heads on both sides of the border. With a robust start-up financing pipeline, a revitalized and engaged Canadian tech community, and public policies that are wholly supportive of a resurgence in the tech sector, the newest and next wave of Canadian tech companies are poised to break out on the world stage.
What became apparent during the meetup is that Canada's technology ecosystem is building a strong reputation throughout Silicon Valley, and that entrepreneurs hold a public listing on TSX in high regard as they explore ways to scale up and grow their companies to new heights. Below are Mr. Kousaie's key takeaways from the meetup:
- Canada's tech ecosystem is the real deal. Several great technology companies are being founded, built and funded in Canada. A prevailing theme throughout the event was that U.S. investors and companies highly admire and respect the encouraging signs on display north of the border (i.e. high-quality talent, excellent universities and innovation hubs, supportive government policies, strong entrepreneurship culture, etc.)
- Public markets are reliable growth platforms. With availability of VC funding at near historic highs, many companies have been able to delay their IPO plans. However, with several success stories of tech companies growing significantly on TSX – Shopify Inc. (TSX: SH) and Kinaxis Inc. (TSX: KXS) come to mind – there is a renewed sense of optimism for an appropriately timed public listing as part of a tactical growth strategy.
- All parts of the Canadian tech ecosystem are working in concert. Promising founders are being supported by accelerators and industry associations; government programs at the federal and provincial levels are encouraging innovation and entrepreneurship; angel investors and venture capitalists are backing exciting companies, both new and established; management teams are executing their growth strategies; IPO investors are providing attractive exit alternatives; and strategic buyers are stepping up with worthwhile valuations.
Momentum in the Canadian technology and innovation sector is also clearly apparent on TSX and TSX Venture Exchange (TSXV):
- The tech and innovation sector on TSX and TSXV is #1 by the number of IPOs and new listings, with over 50 since the start of 2015.
- More than $15 billion in equity capital has been raised by tech and innovation companies listed on TSX and TSXV since the start of 2015.
- Investors in the sector have also seen strong returns: the benchmark Canadian tech index has outperformed the S&P/TSX Composite Index and the S&P 500 over the last one, three, five and 10-year periods.
- And it is not just the public markets that are doing well: angel and VC funding trends are also very strong in Canada, which is allowing the next generation of great Canadian tech companies to start up.
TSX and TSXV are proud to strengthen Canada's tech ecosystem and remain committed to helping emerging companies and entrepreneurs scale up, grow and commercialize their innovations.