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TotalPave Preps for Autumn Launch


More than a year after capturing the $192,000 first prize in New Brunswick’s Breakthru competition, brothers Drew and Coady Cameron are deep into the development of their TotalPave product and preparing for a launch in the autumn.

It’s a smartphone app that helps municipalities and their contractors test road surfaces at a fraction of the current cost. It has drawn the attention of a few local governments and at least one private company, all of whom are impressed by its simplicity and cost-effectiveness.

The concept won the 2012 national Nicol Entrepreneurial Award for a new technology coming from a Canadian university, and the 2013 Breakthru competition, the New Brunswick Innovation Foundation’s biennial contest for the province’s top new startups.

In addition to winning several awards, TotalPave has just gone through the ACclr8 program at Planet Hatch in Fredericton, where their mentors were Jeff Thompson, the founder of UserEvents, and Ryan Strynatka, the chief adoption officer at Salesforce Marketing Cloud.

“What we’ve been doing in the last three months is a huge focus on development,” said Coady Cameron in an interview in Planet Hatch last week. He added that they have completed the first of three phases of the product’s development. “By September, we hope to have all three pieces done, and then we have to sell the thing.”

The Cameron brothers were students at the University of New Brunswick — Drew in business, Coady in engineering — when they got the idea for TotalPave. In the TotalPave system, the user mounts smartphones into standard municipal vehicles to collect data on road surfaces as these cars and trucks drive around on their customary routes. They relay this data to a central facility that automatically assesses it and reports on what roads need repair most acutely.

Getting such data is critical because a typical road will maintain its surface for several years, but once the roadway starts to break down it will do so quickly and dramatically. If a municipality detects the deterioration at the right time, it can make minor, inexpensive repairs promptly rather than paying a lot of money to repave the road.

According to the 2012 Canadian Infrastructure Report Card, 52 per cent of Canadian roads are in bad repair and it would cost an estimated $92 billion to repair them all.

Coady Cameron said the first phase of development involved the manual input of programs and logarithms, and this has been finished. The next phase involves mounting the phones in cars and collecting data. In the final phase, the company will complete its web portal.

TotalPave now has one full-time employee, Coady Cameron, and it has been contracting out the development. Under the company’s sales strategy, TotalPave will allow clients to download the app on as many phones as they want, and then the clients will pay every time they use the system.

The company is looking to secure its first clients, possibly starting with a private contractor, in the fall. That means they could test it before snow falls and spend the winter analyzing the data and working out any bugs.

The Cameron brothers so far have financed the development from their Breakthru winnings and a few government programs. They will consider whether they need to raise capital after they complete the development.

Press Release: Modest Tree, CGTrader


Modest Tree, the Halifax startup whose software-as-a-service product reduces the cost and time involved in making three-dimensional training programs by as much as 85 percent, has put out the following press release:

Modest Tree and CGTrader.com announce partnership to streamline access to 3D models and creation of 3D interactive scenarios

HALIFAX, Nova Scotia, July 21 2014 – Modest Tree Media Inc. ("Modest Tree"), an innovator in 3D authoring software, and CGTrader, a leading 3D model marketplace are pleased to announce that they have formed a partnership to streamline coordination between access to CGTrader’s marketplace of 3D models and Modest Tree’s 3D authoring software.

Customers of Modest Tree’s 3D authoring platform, Modest3D, will be referred to CGTrader’s marketplace, as the preferred off the shelf model provider, which houses a library of over 65,000 models. Modest3D is currently in beta and will be commercially released in the fall of 2014. CGTrader’s 3D modelling customers will be able to bring their 3D models to life by creating 3D interactive scenarios in Modest3D.

Modest Tree’s Modest3D uses a drag-and-drop framework to apply behaviours, animations and interactions to 3D models to create an interactive scenario.  “Partnering with CGTrader is a natural fit as it provides our clients with access to an impressive library of models that fit well in Modest3D’s asset pipeline, as well as access to curated designers for custom projects. ”, said Sam Sannandeji, CEO of Modest Tree.

For CGTrader customers the partnership provides 3D authoring software to rapidly create 3D interactive scenarios using the CGTrader models. “Modest Tree empowers anyone to create animations and interactive scenarios without any programming experience, and with CGTrader no 3D modeling skills are required as well. We are very excited to make the creation process seamless for both our and Modest Tree customers by working together.” said Marius Kalytis, CEO of CGTrader.

CGTrader and Modest Tree are both part of the growing movement to demonstrate and view the world in 3D.

About Modest Tree Media Inc.

Modest Tree is an innovator in 3D authoring software and training solution services. Modest Tree was founded to bring the power of authoring 3D visualizations to all, by simplifying the development process of creating 3D interactive scenarios. Modest Tree is the creator of 3D authoring software, Modest3D. Modest3D empowers users to bring their 3D models to life by applying animations, behaviours and interactions to 3D models to rapidly create 3D interactive scenarios. Modest Tree also provides services for developing 3D interactive solutions.

For more information, visit http://www.modesttree.com

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Press Release: Teen Startup Weekend


Startup Weekend New Brunswick has announced a 54-hour event for teenagers next month in Fredericton. Following is a press release for the event:

Startup Weekend NB (Youth Edition) is coming to Atlantic Canada for the first time!

On August 22-24, 2014, Startup Weekend New Brunswick will be putting on a youth event for 14-18 year olds. The event will be happening at Planet Hatch in Fredericton, New Brunswick. The event will begin at 5pm on Friday, August 22.

Startup Weekend is a global grassroots movement of active and empowered community leaders, and entrepreneurs who are learning the basics of founding startups and launching successful ventures. All

Startup Weekend events follow the same basic model: participants have the opportunity to pitch, but anyone is welcome! Teams organically form around the top ideas (as determined by popular vote) and then it’s a 54 hour frenzy of business model creation, coding, designing, and market validation.

Participants engage with community leaders, entrepreneurs, mentors and leave the event better prepared to navigate the chaotic, but fun world of startups. You can find out more at http://startupweekend.org

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Through workshops, mentors, and collaborating with other young people, participants will gain essential skills in creating, pitching, and building ideas. We are inviting students from across the province to join us for a weekend of creativity, collaboration and connection.

To register and for more information, check out our community site: http://nb.up.co

Nova Scotia Revamps VC Funding


The Nova Scotia government unveiled a new policy on business development on Thursday, which will result in a three-pronged approach to venture capital investment in the province.

The most immediate change will be Innovacorp, the provincial innovation agency, becoming the sole Crown corporation responsible for VC investment and adopting a simplified procedure for seed investments. Nova Scotia Business Inc., which has a portfolio of 12 companies, will no longer make venture capital investment. Its primary roles will be business attraction and the development of businesses and trade.

Meanwhile, government will release a Request for Proposals in the autumn for proposals from the private sector to launch a new investment vehicle that would use public and private funds.  

The third prong is Build Ventures, the regional private VC fund for follow-on financing, which all Atlantic Provinces and the federal government have committed to funding.

Michel Samson, the minister of Economic and Rural Development and Tourism, said the government is not saying how much it will contribute to the new Nova Scotian investment fund, preferring to first review the proposals it receives.

"The private sector has told us … that government needs to be more responsive to the needs of business," said Samson in a statement. "This means having experts who understand solid business cases and the need for quick turnaround.”

Nova Scotia has had two publicly owned VC funds, with Innovacorp tending to invest in early-stage companies and NSBI doing later stage investments.  Innovacorp will now consider whether to take over some members of the NSBI portfolio, said CEO Stephen Duff. (There are a few companies, such as Oris4 and Health Outcomes Worldwide, that have received investment from both organizations.)

Innovacorp has adopted a new policy in which it will offer a simplified term-sheet to companies receiving seed investment, of say $250,000 or less. More thorough negotiations may still be required for larger investments.  Duff said the goal of the simplified term sheets is “to introduce speed, lower costs and more efficiency when we’re reaching agreements.”

As for the new VC vehicle, Samson said the government wants private operators to look at gaps in the current financing ecosystem and propose a system that would improve it. In a brief interview with Entrevestor, the minister said his department is aware of reforms now being introduced in Newfoundland and Labrador that could serve as a model.

Newfoundland will put money into a fund managed by GrowthWorks Atlantic, and members of the Newfoundland and Labrador Angel Network will also be invited to invest. NLAN members putting money into the fund will be eligible for an investment tax credit.

“I’m pretty sure the Newfoundland model will be something we’ll be looking at,” said Samson.

Meanwhile, a spokesman for NSBI said the organization is reviewing the future of its investment portfolio, and the team headed by Peter MacNeil.

NSBI will assume some of the business development duties -- including the Capital Investment Rebate and the Small Business Development Program -- now handled by the Department of Economic and Rural Development and Tourism. It means the government will no longer operate the Jobs Fund, which had been criticized as a political slush fund.

Thursday’s announcement came about after the government received three reports in the last year: the report of the OneNS commission led by Acadia University President Ray Ivany; a report on venture capital by consultant Gilles Durufle; and a review of economic development tools by former Dalhousie University president Tom Traves.

The companies in the NSBI portfolio, as listed on the Crown corporation’s website, are:

Azorus

Industry: CRM Software Development

Authorized Investment: $2,500,000

Dynagen

Industry: Energy Control Management

Authorized Investment: $1,000,000

Halifax Biomedical

Industry: Life Sciences

Authorized Investment: $2,000,000

Health Outcomes Worldwide

Industry: Healthcare/ e-health/ technology

Authorized Investment: $1,500,000

Impath Networks

Industry: Software Development

Authorized Investment: $4,000,000

Intelivote

Industry: Electronic Voting Software

Authorized Investment: $2,800,000

Kytogenics

Industry: Medical Product Development

Authorized Investment: $2,000,000

LED Roadway Lighting

Industry: Renewable Energy

Authorized Investment: $11,000,000

Origin BioMed

Industry: Health

Authorized Investment: $7,928,000

Oris4

Industry: Enterprise Technology

Authorized Investment: $1,000,000

Techlink 

Industry: Responsible Gaming Software

Authorized Investment: $13,000,000

Unique Solutions

Industry: Apparel and Health

Authorized Investment: $5,628,108

Stressing Economics in Social Ventures


There’s a common misconception that you have to be naive or idealistic to create a socially responsible business.

In fact, establishing social credentials makes sound business sense, believes Kristy O’Leary, co-founder and lead impact strategist at Halifax communications agency Scout & Burrow.

“Lots of people think that because you want to create social change you’re some kind of flake,” O’Leary said as she sat in the May Street office that still feels new 11 months after the agency opened.

“But companies need to look at their social and environmental impact. Studies show that more than 80 per cent of consumers want to know what companies are doing to make the world better.”

O’Leary and co-founder Carly Murray established Scout & Burrow in August last year with the aim of helping businesses increase their impact for social good, and thus boost their customer base and their profits.

“It doesn’t matter what you did yesterday. Today, you can build a better company or organization,” she said.

“Advertising corporate social responsibility is powerful, so do it right and create impact. Then let people know about it.

“We scout for clients that demonstrate the will to be better,” she added. “It doesn’t matter what industry they work in.”

An increasingly popular way in which companies demonstrate their social responsibility is by acquiring B Corp (Benefit Corporation) status, O’Leary said.

A U.S.-based initiative, B Corp certification requires companies to demonstrate their commitment to social good by scoring at least 80 out of 200 in four key areas: workers, governance, environment and community.

Traditional companies score an average of 44.

O’Leary and Murray went ahead and acquired B Corp status for their own agency and now they assist many of their clients in the process. O’Leary said she believes Scout & Burrow to be the only B Corp certified marketing group east of Toronto and the only female-led B Corp in the Maritimes.

“B Corp matters because it’s a third party saying you’re not green washing or social washing,” she said.

 “You can’t fake it. Of our for-profit clients, 100 per cent are going for B Corp certification. A year ago, no one in Nova Scotia knew what B Corp was, but it’s starting to filter into consciousness.

“We’re aiming for 10 new B Corps in Nova Scotia by the end of the year,” she continued. “At the moment, there are just four — us, Common Good Solutions, Maritime Tidal Energy and EcoAdvisors.”

Many companies take several attempts to achieve B Corp status. But weakness in one area can be offset by strength in another. For example, a tire maker can increase their score by developing community projects.

Originally from Smiths Falls, a small town in Ontario, O’Leary, now 36, has been in Nova Scotia for nearly 11 years.

Her parents ran a general store which was decimated by the arrival of big-box stores, she says. Jobs were lost in the town when big businesses closed local operations.

That background gave her a natural interest in social justice which she developed initially through art.

She was a NSCAD artist-in-residence and completed an archiving project that documented the changes caused by climate change and witnessed by seniors on Nova Scotia’s South Shore.

In 2008, she entered the advertising world, cutting her teeth on food and energy clients. “I wanted to help consumers make choices on an ethical level,” she said.

She and Murray are still bootstrapping their business and have been assisted by completing the B4 Change accelerator program for social entrepreneurs at the Pond-Deshpande Centre at the University of New Brunswick.

“There is a lot of interest in our process and we are working on our first companies that have huge scalable potential. We are going to change the game,” she said, her eyes brightening at the thought.

Press Release: Peter Zimmer Retires


CarShareHFX, the Halifax-based car-sharing outfit, has issued the following press release:

CarShareHFX cofounder retires

CarShareHFX announced today that its cofounder and co-owner, Peter Zimmer, is retiring from his position of general manager. Peter has grown CarShareHFX into a Halifax institution with almost 1000 members and 25 cars.

“Peter is a true pioneer for starting CarShareHFX. It was his passion and dedication that enrolled me into the partnership and made it happen operationally. He’s created a real legacy for Halifax”, says President Pam Cooley.

For ten years, Zimmer gathered the knowledge, resources and passion he would need to start CarShareHFX, before he teamed up with Pam Cooley in 2008 to launch the ideas into action. To date, CarShareHFX has taken 250 personal vehicles off the road by offering residents an alternative mode of car ownership. Now Zimmer is ready to pass on everything he knows.

“I’m the resource,” says Zimmer, who will be close at hand for guidance and support. “I want CarShareHFX to benefit from the things I’ve learned.”

Zimmer’s position will be filled by John Laroche, from Ottawa. Laroche spent the last four years in various positions at Vrtucar, Ottawa’s carsharing company. There, he saw the company grow from 50 to 100 cars and 1,000 to 2,500 members. Laroche is ready to drive the same growth at CarShareHFX. One of his first tasks will be to oversee the addition of five more cars to the fleet over the summer, bringing the total to thirty and creating more value for CarShareHFX’s members.

“Halifax is extremely fortunate to have John’s experience imported from Ottawa!” says Cooley. Car sharing is a game changer for cities that want to have a mobility mix that creates a higher quality of life. We are an important part of that mobility mix.”

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About CarShareHFX

CarShare Atlantic Limited (“CarShareHFX”) is a year-round service that provides Halifax businesses, institutions, organizations and household members with easy, self-service access to a fleet of vehicles that can be rented on an hourly basis. CarShareHFX aims to make Halifax greener, by providing a viable, convenient alternative to vehicle ownership.

Bluelight Partners with Henry Schein


The world’s largest provider of health-care products and services has begun to offer Halifax-based BlueLight Analytic Inc.’s main product to its customers in Canada.

Henry Schein, Inc., the Melville, N.Y.-based medical product distributer that had US$9.6 billion in sales last year, issued a statement last week saying its Henry Schein Canada subsidiary will be the first distributor of checkMARC, BlueLight’s main product. CheckMARC is the world’s only independent and accurate measurement system for testing the amount of light dentists use for curing the resin in their patients’ dental fillings.

 “We’ve been doing things with Schein almost from the very beginning,” said BlueLight CEO Colin Deacon in an interview. “They’ve even lent us dentist chairs at conferences so we could do demonstrations. Then about a year ago we really began to talk seriously about doing something together.”

Deacon said BlueLight is also talking to “about half a dozen” other private sector companies about distributing checkMARC. The company is now four years old and Deacon said it is starting to bring in meaningful revenues in 2014, though he declined to provide details.

 “What’s really great about this deal is that they (Schein) are paying for the first test provided to each dentist,” said Deacon. “They see checkMARC as central to the quality of care.”

Built from an idea generated at Dalhousie University, checkMARC addresses a sizable problem in modern dentistry. Dentists make more than half their income from resin-based fillings, but have never been able to ensure they are using the right amount of energy when curing the resin. CheckMARC lets dentists check their curing lights and make sure the energy levels are optimal.

BlueLight provides the checkMARC equipment and software to Henry Schein. and then earns revenue each time they are used to test a dentist’s curing light.

 “Henry Schein customers rely on us to provide the latest innovations in products and services,” Peter Jugoon, Henry Schein Canada’s vice-president, marketing and planning, said in the statement.

 “BlueLight’s checkMARC service brings cutting-edge technology to dental practices, helping to improve the quality of care and patient experience.”

In January, Deacon gave a presentation on checkMARC to the U.S. military at an event in San Diego, and he said the talks with the military are ongoing. The American forces provide medical and dental treatment for all their personnel, and spend more on dental services than all of Ireland.

 “What’s exciting about the U.S. military is that they have the payer, the provider, and the patient all in one organization,” said Deacon. “They’re unique from that perspective and we can provide them a unique opportunity.”

Still, the driving force behind the company’s growth now is the dealings with private sector distributors, including Schein. The company has 10 full-time employees, is now searching for two programmers, and will soon announce other openings.

BlueLight so far has been funded by angel investors, and has just closed a round of $750,000 in equity funding.

Verafin’s Culture Led to $60M Deal


One week before he announced the deal that would transform his company, Verafin CEO Jamie King came home to his alma mater to describe the secret to his company’s success.

King and two co-founders had started Verafin, which develops software that helps banks fight money laundering and fraud, at the Genesis Centre at Memorial University of Newfoundland in 2003. The story is often told in St. John’s that they set out to develop software for the mining industry. But they soon realized there was a better market in helping banks prevent fraud and money laundering, so they pivoted.

On Thursday May 8, King delivered the closing address at the Open House being held that day by the commercialization centre of the Newfoundland university.

He made a vague reference to the pending $60 million buy-in by Spectrum Equity, saying only that he’d been talking to investors and hoped to have an announcement soon. One week later he would reveal that the Boston and Silicon Valley-based private equity firm would take a major stake in the company, allowing several early investors to exit. During his speech, what he wanted to detail for the students and entrepreneurs at the Open House was the culture that makes Verafin unique.

“I realized years ago our continued success as a business would not be based on my ability to write code or algorithms all day that would detect and prevent fraud,” he said. “Our business success depended on developing a company where innovation could flourish.”

And Verafin has undeniably become a success. It attracted its 1,000th customer in March 2013, and has kept growing. It has 200 employees, and its revenues this year are expected to increase 50 percent to $30 million. King plans to continue growing and to add as many as 150 employees in the next two to three years.

And the company meets a definite need as debit fraud losses could reach $20 billion by 2015 and the United Nations Office on Drugs and Crime estimated in 2009 that the amount of criminal proceeds laundered globally each year reached $1.6 trillion.

Verafin frequently learns of its software being used to catch people engaging not only in white collar crime but also drug trafficking, terrorism, elder abuse and human trafficking – news that invigorates the entire staff.

King stressed in his speech that Verafin is perpetuating its winning formula by developing a corporate culture that stresses six facets: purpose, value, growth, reward, freedom and joy. And the speech demonstrated that Verafin goes beyond the usual clichés in addressing these values.

“Verafin has been a great company to be associated with, both in their product and their approach to management,” said Mark Dobbin, the head of Killick Capital, an early investor in the company. “I’ve learned more from being on their board than from working with any other company I’ve been associated with.”

Case in point: when Verafin opened its first office, King and his cofounders didn’t like the factory-made cubicles that were available because they didn’t engender teamwork or creativity. So they bought plywood and built their own tables – circular and portable. They could be moved anywhere. That means employees can sit around a table one week and move around the next as teams reconfigure. Some staff sit at a different table each day, depending on who they need to sit with.

Verafin encourages “continuous improvement” throughout the entire organization, King said. Once a month, there are hackathons in which a team proposes a new product and has 24 hours to come up with a prototype. King said the benefits of such innovation radiate throughout the organization.

Verafin also has each of its divisions set its goals for the coming quarter, and detail those goals to the entire company. That means 30 teams, quarter after quarter, set higher standards for themselves and fight to meet those standards.

“People love it,” said King. “Do you know what they like about it? They love it because no one is telling them what their target will be. They’re setting it themselves.”

Much of the culture in Verafin rests on the employees setting their own standards, and having their performance assessed by their peers.

Rather than performance reviews set by managers, Verafin encourages peer reviews so everyone – even King himself – is assessed by other staff members.

The company aims to reward its employees, but not necessarily with cash. There are no performance-related compensation packages, even for the sales people. King said the sales team is paid well but not with commissions.

So how does it reward employees? The employees – sales people and others – compete to see who can make the most noise when they meet their quarterly targets. (King’s slides included photos of cowbells, fog horns, gongs and other instruments of mass dissonance the staff use.)

Any team hitting a target can celebrate by making all the noise they want. A big sale calls for a chain of high fives. That means every employee (as many as 200 people on any given day) line up and the sales person who scored the sale runs through the office high-fiving them.

There may be fewer than 200 people on some days because Verafin employees are allowed to work wherever they want, at home or at a coffee shop, as long as they meet their targets. Or they may be on vacation. Verafin does not track its employees’ vacation. “We’re talking about adults here,” said King simply.

King also said he and the company founders have had their own book club since they started the company. They read and discuss the same books to mine the ideas of leading business thinkers. “If you ever want to build something impressive, never, ever, ever stop reading,” said King, who is trained as an engineer. “If you stop reading, you’re done.”

Finally, King said his staff likes to have fun. The company has been known to clean out the nerf gun section of Toys R Us so the staff will have guns to play with. If he’s walking through the office and gets hit by a nerf dart in the side of the head, he just keeps walking because it’s just another day at Verafin.

As King delivers his speech, it’s necessary to keep reminding yourself that this is a company that successfully foils the world’s leading crime syndicates in their essential goal of laundering illicit funds. And the company that hands out nerf guns to its staff is good at fighting financial crime, as $30 million in revenue and a $60 million buy-in will attest.

 

This article first appeared in the Spring 2014 Entrevestor Intelligence report, which can be found here

Marli MacNeil, BioNova Part Ways


BioNova, the Nova Scotia life sciences association, has adopted a new strategic course that has resulted in the departure of Marli MacNeil, who was the group’s executive director since its founding 12 years ago.

MacNeil said in an interview Friday that her position ended last week and is now taking time to enjoy the summer and consider her options.

“I’d love to be able to continue working to help the life sciences companies because I continue to believe we’ve got some super companies here.”

BioNova was founded early in the century when there were a handful of life sciences companies in the region, but the sector was embryonic at best. A group of founding members understood there was huge potential to commercialize the research being carried out at the hub formed around Dalhousie University’s medical and dentistry schools and the hospitals in Halifax.

In 12 years, the sector has grown to the point where it could be on the cusp of becoming a significant hub on a national or international level.

Several of the life sciences companies in the province are now gaining notice, because of impressive sales or the potential of their technology or both. For example, Halifax Biomedical of Mabou has landed some huge sales lately.

ABK Biomedical of Halifax has received funding recently from First Angel Network of Halifax and other angel groups across North America. It also received a $2.1-million Atlantic Innovation Fund loan to commercialize new biomaterials that will simplify and enhance the delivery of chemotherapy and radiotherapy for patients.

MacNeil said a group of BioNova members recently attended the BIO International Convention for life sciences in San Diego, where Immunovaccine of Halifax was “the talk of the town” because of new-found interest in immune system-based medicine.

She said BioNova and the sector overall now need to determine ways to move these and other companies on to “the next level.” Essentially, the industry has gone through a lot of company formation and now has to gain expertise in helping these startups grow into bona fide companies.

“We’re great at having babies, but what are we going to do when they’re teenagers?” MacNeil said.

Asked what is needed and how to provide it, she said BioNova is beginning to determine what is required and what to do, and more work will be needed to plot the next chapter.

BioNova is now headed by a 12-member board of directors chaired by Brian Lowe, the head of ABK operations and co-founder of First Angel Network. The three-member staff is now led by managing director Scott Moffitt.

MacNeil’s news marks a changing of the guard at two of the leading startup support organizations in Halifax. Milan Vrekic, executive director of Volta Labs, the city’s main tech startup facility, said this month he will be stepping down in the autumn to pursue other opportunities.

MacNeil said she hopes to stay in Nova Scotia and will always support the local companies in any way she can.

“My job has always been to be a cheerleader for these companies, and now I’ll be cheering from a different side of the field.”

BioNova could not be reached for comment.

Kinduct Buys HealthMet Tech


Kinduct Technologies, the Halifax health-technology company, has acquired Vancouver-based HealthMet Technologies for an undisclosed sum to extend its reach in the community and corporate markets.

Founder and CEO Travis McDonough said in a statement Saturday that the combination of the two companies will accelerate their growth in key markets.

Kinduct has developed a technology platform that helps medical professionals, trainers, coaches and other improve the health and fitness of people.  The platform is multi-faceted and can be adapted to specific markets. For example, it includes the world’s largest databank of medical animation, which can help physicians to explain procedures to patients and to educate them.

Now the Halifax company will be able combine its work with HealthMet, which has spent two decades developing scalable programs to deliver health training to the masses. Its three main programs are the Corporate Challenge, Community Challenge, and 60-Minute Kids Club Challenge. These will now be offered under the Kinduct brand.

“Both Kinduct and HealthMet are passionate about the benefits of healthy living,” said McDonough. “But we know most people have trouble attaining – and maintaining – the health and wellness levels they need. Together our products offer a powerful combination of information, motivation, accountability, tracking, behavior change tools and analysis that is currently lacking in the health, wellness and performance marketplace.”

HealthMet founder and CEO Matt Young will remain with the enlarged company and said he perceives benefits of combining the two companies’ operations.

“Kinduct’s technology platform is so robust and scalable that it has exponentially boosted the power and reach of the HealthMet program,” Young said. “Existing and future clients will see enormous benefits in functionality and results.”

Kinduct has been growing this year in part because of the partnerships it is striking with complementary groups. In April, the company joined with Capital District Health Authority, OrthoMX Inc., both of Halifax, and Laval, Que.-based Emovi to form Mobility at Capital Health, a $2.6 million project designed to accelerate the treatment of patients with mobility issues. The project received a $1.7 million loan from the Atlantic Canada Opportunities Agency’s Atlantic Innovation Fund.

O’Brien Capitalizes on B Corp Status


With less money and staff than corporations, community groups and non-profits often struggle to make their websites and social media effective. To help them, Kelly O’Brien, a Fredericton-based web designer, has established BBoards.org to allow non-profits to easily post and share content.

“We want to help non-profits and social enterprises around the world find their voices and connect with each other,” said O’Brien, who has more than 20 years of technical experience in product and business development for names like U.S. Surgical Corp. and NBTel Global.

“A few years ago, I became engaged with non-profits and I realized how few tools and resources they have to deliver on their mandate compared with corporations,” he said. “It struck me as unfair and I did a mid-life pivot from the global IT marketplace to help these organizations keep up online.”

Born in Halifax, where he worked for Enercom and AT&T, O’Brien has been developing BBoards.org in collaboration with many partners and has just completed the B4 Change accelerator program for social entrepreneurs at the Pond-Deshpande Centre at the University of New Brunswick. The six-month program helps those who found a business that meets a social, economic or environmental need and turns a profit.

“B4 Change made me feel part of the growing global social enterprise movement,” he said. “They also introduced me to the idea of the Benefit Corporation (B Corp).”

A growing U.S.-based initiative, B Corp certification requires companies to meet high standards that demonstrate their commitment to social good. Acquiring B Corp certification is tough, but O’Brien went ahead, becoming New Brunswick’s first B Corp in the process.

“It took a couple of months to get B Corp certification. There were challenges, but B Corp status demonstrates that we think differently, operate differently, and are not going to change. For instance, we’re not going to clutter our customers’ boards with adverts. We even have non-profit shareholders. It helps us establish credibility among the people we want to support.”

So far, most BBoards.org clients are Canadian, although there are a few in the U.S., Mexico and Latvia.

The venture has high-profile New Brunswick business accelerators as clients, as well as some small businesses that have been attracted by the system’s ease of use and ability to share content. Pictures, videos, links and supporting documents can all be shared in one bulletin, O’Brien said. A single click allows the bulletin to be shared to social media where links direct the viewer back to the home page where there is a donation button.

“We also provide analytics; we give clients real-time feedback on the content people are engaging with,” he said. “And we allow organizations to connect and syndicate their content on each other’s boards; it’s co-operative, not competitive.”

BBoards.org’s basic cost is $19 a month, but discounts for early adopters and groups are available.

O’Brien said he is currently talking to interested First Nations communities and plans to target large umbrella organizations that often shelter thousands of smaller groups, such as Lions Clubs International.

During these years of hard development work, O’Brien has had little time to play his treasured Les Paul guitar or listen to vinyl, but things are coming together.

“We’ve had people volunteering to help us,” he said. “It’s been a wonderful and challenging experience to bootstrap this and it’s exciting to be getting to market now. We’re aiming to build a global community of change-makers.”

 

Assessing the First Half of 2014


Looking back on the first half of 2014 in the Atlantic Canadian startup world, there’s not a single event, company or story that stands out as a singular highlight.

So in writing a wrap-up of the first half, I think the dominant feature would really be a state of mind that didn’t exist six months ago. It’s a new-found maturity.

There were lots of candidates to be highlights of the first half. The Big Data Congress in Saint John and Atlantic Venture Forum in Halifax were both successfully held for the second time. St. John’s held its first Innovation Week. There were exits by UserEvents of Fredericton and Compilr and Newpace, both of Halifax. PropelICT of New Brunswick and the P.E.I. BioAlliance both received federal funding under the Canada Accelerator and Incubator Program that will change the scope of their work.

All of those are great, but there’s a bigger story in this sector. People were pleasantly surprised when Entrevestor reported in March the startup community now directly employs about 3,000 Atlantic Canadians, and is indirectly responsible for about 15,000 jobs in the region.

Yes, that was a shameless plug, but the findings of our survey were reported in the National Post and several regional media outlets. And they set a baseline from which to assess future employment growth. They also showed that young innovative companies are becoming a force in the economy.

That message was borne out two months later when 26 companies pitched to investors from the region and across the continent at the Atlantic Venture Forum. As we reported recently, 22 of these companies revealed their revenue for the past two years, and in total they booked $4 million in 2013. For this year, they’re expecting revenue of $13.8 million — an increase of almost 250 per cent. Eight of the companies are expecting revenue of $1 million or more.

Here’s the thing about the Atlantic Venture Forum pitchers: they weren’t out of the ordinary. Yes, there were some great startups that were pitching, but I believe the organizers could have chosen another 26 companies with no decline in quality.

There are a handful of Atlantic Canadian startups that are shooting ahead of the pack and there’s a lot of buzz about Smart Skin Technologies of Fredericton, Blue Light Analytics of Halifax and Halifax Biomedical of Mabou, among others. Marching behind them is a regiment of companies that are growing at an impressive pace.

If I were asked to name one thing to watch for in the next six months, I think the answer would be the biotech sector. The digital segment so far has captured most of the attention in the startup world, but I think life sciences could be about to correct that. Two biotech companies — Neurodyn of Charlottetown and DeCell Technologies of Halifax — captured the top award for pitching at the venture forum. The segment as a whole could produce a lot of news in the last half of the year.

Of course, all of this means the bar is being raised across the startup community. Weaker companies are being left behind, and support organizations have to let them die. Financial and human resources need to be concentrated on the best companies. Is that a harsh reality?

Nope. It’s just part of being in a more mature ecosystem.

Vrekic to Step Down at Volta


Milan Vrekic will soon step down as the Executive Director of Volta Labs, the organization that has established itself as the hub of the startup community in Halifax.

In an Interview Tuesday, Vrekic said he is eager to return to his first love, which is building young companies. He said he is considering three options, one of which is in Halifax, and his preference would be to remain in the city. He is aiming to leave Volta on about Sept. 1, but it will depend on the ability to find his replacement.

“We basically agreed from day one that this should be a temporary role,” said Vrekic. “We don’t want to build a cult of personality. The role should always be fresh. … The way to do this is to have someone in the role for a year or a maximum of two years.”

Having previously served as Co-Founder and CEO of the secure document-sharing startup TitanFile, Vrekic joined Volta Labs when it opened in May 2013 and played a key role in establishing the startup house and setting its tone.

The facility on Spring Garden Road is home to about a dozen startups, houses Build Ventures and hosts regular events.

Vrekic said the continuity in the organization will come from the staff members and from the board, which includes Jevon MacDonald, Co-Founder of GoInstant, and Patrick Keefe, Partner at Build Venture.

In filling the new position, it’s possible the board will opt for an entrepreneur-in-residence rather than an executive director so the focus will be on working with startup founders.

“We’re looking for someone who has done it [running a startup] before – someone who entrepreneurs can relate to,” said Vrekic. He said his replacement will have to work with inexperienced entrepreneurs and show them how to structure and manage their company, attract investment and land clients. The person should also have a network of contacts in and outside the region to help open doors for entrepreneurs.

Whether Vrekic’s successor is an executive director or not, the Volta team is now looking at expanding its operations and searching for a larger physical space. The startup house has formed a partnership with PropelICT of New Brunswick, which will soon offer 12-week accelerator programs at the facility.

It wants a larger space because it wanted to house more startups, including space for more late-stage companies. (The current tenants are now expected to move on after a year.) 

ACOA Unveils $43M AIF Funding


The Federal Government on Tuesday announced that it has awarded $43 million in loans to research projects in the region through the Atlantic Canada Opportunities Agency’s Atlantic Innovation Fund.

The AIF lends money to startups and public organizations to conduct market-oriented research, usually over a period of years. The ACOA press release said the projects have a total value of more than $123 million, and will bring in an additional $80 million from a variety of private and public sector sources.

The following is a description of the projects and the amount they will receive:

Nova Scotia

Capital District Health Authority

AIF funding will allow the Capital District Health Authority to develop push-button MRI diagnostics to ultimately improve diagnostic capabilities and aid in clinical decision making to improve patient outcomes. 

AIF Amount: $2,959,855

ABK Biomedical Incorporated

ABK Biomedical’s project will focus on the development and commercialization of new biomaterials that will simplify and enhance the delivery of chemotherapy and radiotherapy for patients.

AIF Amount: $2,140,000

Dalhousie University

This project will help to improve the performance of underwater sensors and instrumentation by developing an innovative acoustic wireless modem that performs complex signal processing.

AIF Amount: $2,321,299

Metamaterial Technologies Inc.

With AIF funding, Metamaterial Technologies Inc’s project will develop and commercialize a thin, transparent film that can be applied to the windscreens of airplanes in order to protect against cockpit laser illuminations.

AIF Amount: $3,000,000

New Brunswick

Forest Protection Ltd.

AIF funding will allow Forest Protection Limited to develop new products and techniques to intervene early in spruce budworm outbreaks in order to mitigate pest-related impacts on forest integrity, timber supply, and industry productivity.

AIF Amount:  $10,000,000

Enovex Technology Limited

Through this project, Enovex Technology Ltd. will develop an adsorbent material that produces nitrogen at lower costs compared to existing products in the industrial gas market.

AIF Amount: $2,319,554

Prince Edward Island

iWave

iWave will develop and commercialize a new software solution designed to provide an efficient and effective tool for prospecting and fundraising initiatives undertaken by non-profit organizations.

AIF Amount: $1,994,624

Pan-Atlantic

Springboard Atlantic

With AIF funding, Springboard will continue its focus on programs and activities that help accelerate academic innovation, push technologies to market and attract industry demand for university research.

AIF Amount: $8,500,000

HotSpot Aims for Third City This Year


Now that it has completed the Launch36 accelerator, Fredericton startup HotSpot Parking is gearing up to roll out its solution for downtown shoppers and merchants in its third Atlantic Canadian city.

HotSpot Parking began as a product that allows consumers to pay parking meters remotely through their cellphones. But as it passed through two accelerators — ACelr8 at Planet Hatch and Launch36 — the company has refined its product and the focus of its technology.

When he presented the company at the Launch36 DemoDay last month, CEO Phillip Curley said the company is now operating in Fredericton and Saint John and hopes to be on the streets of Halifax in the autumn. And the aim is to help to sustain downtown businesses in these and other cities.

 “What we’re all about is connecting cities,” said Curley. “Every city is growing but the downtown cores are in trouble.”

The HotSpot technology allows the remote payment of parking meters. Drivers can feed the meter without interrupting their shopping or meetings. Or merchants can use a cellphone to pay a customer’s parking, rather than have the customer run out of the store to feed the meter and never return.

But that’s only what the driver sees in the solution.

In the past year, Curley and his team have advanced their system so it produces invaluable data for downtown businesses. Hotspot Parking allows these businesses to advertise directly to customers through their cellphones. And because of the geolocation capabilities of cellphones, the company can track how many people respond to their ads, who returns and who spends money.

The system is now bringing in about 20 to 40 customers a month for a restaurant, said Curley, enough of a boost that it makes it worthwhile for the operator to subscribe to HotSpot.

Curley said that a small business can now spend $2,000 to $4,000 a month on radio ads, which is not focused on its customers and has no way of tracking the ad’s effectiveness. But with HotSpot parking, the business proprietor knows when a customer is nearby, can send a targeted ad and see whether it works.

 “It doesn’t matter if I only brought in five customers as long as I can prove I brought in those five customers,” he said.

There are now about 100 businesses in New Brunswick that use the service, up about 10 fold from late last year. The company has a strong pipeline of other companies planning to subscribe. And about 3,500 individuals have signed up for the parking app — a figure that is growing 20 per cent per month.

 “We’ve got to keep growing it. There are 12,000 people in the Fredericton downtown daily, so what can we do to excite these people and get them enrolled.”

Curley is still looking to grow the company. In terms of geography, HotSpot has identified 400 advanced cities in North America and has already contacted 175 of them. In terms of products, the company is looking at expanding into a transit service.

The company has already raised $325,000 in equity funding from angels and other investors, and added about $175,000 from government programs.

Startup Cape Breton Event Monday


Startup Cape Breton, the new group promoting entrepreneurship on the island, will hold its inaugural event Monday, July 14, from 4 to 6 pm at the Verschuren Centre of Cape Breton University.

The event aims to explore new opportunities in technology, business, and education and will feature speakers from Cape Breton, Atlantic Canada and outside the region.

Startup Cape Breton said it aims to develop a startup community on the island to capitalize on its strengths in creativity and human resources. It wants the island to be a “place that is home to hundreds of startups — small and medium-sized technology and innovation companies, working in everything from healthcare and the health sciences, to energy and transportation, to government and education.”

The guests at the event will include: Gavin Uhma, CTO , GoInstant; Valerie Fox, CEO, Digital Media Zone;  Wes Gould, COO, REDspace, Annette Verschuren, Chair/CEO , NRStor Inc.; David Rae, Dean, Shannon School of Business, CBU; Rachael Mackeigan, Coordinator, Community Access Program, Darren Gallop, CEO, Marcato Digital Solutions, Dale Keefe, VP, Academic & Research, CBU; Andrew Swanson, CEO, Verschuren Centre, CBU; Sheldon Levy, President, Ryerson University; David Wheeler, and President, Cape Breton University. 

Dan Martell: Tier 1 Accelerator Needed


Whenever we build a component of the Atlantic Canadian ecosystem, we have to model ourselves on the best examples in the world.

So we need to develop an accelerator in the region that meets the criteria of the Global Accelerator Network, or GAN, the governing body of startup accelerators. That means there has to be an Atlantic

Canadian accelerator backed by a fund, and that invests in the companies it mentors.

It’s the model used in the U.S. by Y Combinator, TechStars and 500 Startups. It’s also being used in Canada by such leading groups as Grow Labs in Vancouver and FounderFuel in Montreal. It’s simply best practice in the accelerator world. You can’t be recognized by the GAN without it.

Atlantic Canada now has a few accelerators and there are discussions about developing more. We have groups that call themselves accelerators, but fall short of the accepted model. But what we need is a mentorship group backed by private sector investors who can attract the best companies from anywhere in the world, as well as companies grown in Atlantic Canada.

By developing an accelerator backed by a fund, we will suddenly occupy a different position in the global market. Investors will insist that the accelerator be able to court the best companies anywhere and attract them to the region.

That doesn’t mean we’d be crowding out Atlantic Canadian companies.

It means that local startups have to make sure they are as good as any in the world to gain entrance to the accelerator. If they’re not at this level already, they have to up their game to get in – which is the whole point of an accelerator, isn’t it?

Many of the companies that would come to Atlantic Canada to work in the accelerator would end up staying here. That has certainly been the experience of Startup Chile, which follows the fund-backed model and has been attracting entrepreneurs from around the world. TechStars is based in Boulder, Co., and 35 to 40 percent of the companies that enter TechStars end up staying in the Boulder area.

The accelerator will need to focus on a specific growth segment – such as 3-D printing, drones, bitcoin, big data, biotech or stem cell – to differentiate itself from all the other accelerators out there. By focusing on a specific sector, this accelerator would become option of choice for startups around the world operating in that specific growth industry.

To attract the best companies, you can’t be the fourth or fifth option for startups that couldn’t get into Y Combinator. You have to be their first choice. And that means developing an accelerator that is recognized globally.

It would not take a ton of money to launch this initiative. TechStars was started with an initial funding of $118,000. Half the money could come from local entrepreneurs and the other half from a fund-of-funds. There would have to be physical space – another criteria of the GAN.

The biggest challenge will be finding the right person to run the accelerator. It would have to be a seasoned entrepreneur with experience in the specific segment chosen by the accelerator. And if we find that unique person, we could create an accelerator in Atlantic Canada that would gain an international reputation quickly.

 Dan Martell is the Founder and CEO of Clarity.

 This article first appeared in our Spring 2014 Entrevestor Intelligence report, which can be found here

Financing Ugandan Entrepreneurs


Eight years after it was founded to save a sick child, Uganda Venture and its dedicated managing director, Fadi Al Qassar, are getting high-profile help in its efforts to finance Ugandan entrepreneurs.

Among its many valuable projects, Uganda Venture reduces poverty in rural Uganda by providing entrepreneurs with access to capital through micro-credit loans of between $300 and $750.

There is huge need, and the group is struggling to meet demand. It’s hoping that with the help of a local entrepreneur who is part of California-based tech giant Salesforce.com, that effort will receive a boost.

Salesforce is well known in the region after buying into several Atlantic Canadian companies, including New Brunswick’s Radian6, co-founded by Marcel LeBrun. It was sold to Salesforce for $326 million in 2011.

“Marcel LeBrun is now senior vice-president and general manager of Salesforce Radian6 and he is going to be mentoring me for six months,” said Al Qassar by phone as he strode the streets of Halifax, keen to catch up on local work after spending seven weeks in the village of Tabiro, the venture’s Ugandan base.

“We’ve been able to provide loans to 25 individuals since the micro-loan program launched in May 2013,” he said.

“People are expanding their businesses, paying us back and living sustainable lives, but many others would benefit from this kind of loan.”

Al Qassar said that, among other things, LeBrun will advise him on raising funds through crowdfunding, the collection of money from many backers that usually occurs through the Internet.

“It will be great to have the help of someone who has a lot of knowledge in the area of bringing a digital product to market.”

Born in Jordan, Al Qassar joined Uganda Venture as a student volunteer in 2006, when the connection between Halifax and Tabiro was forged through the work of Halifax physician Wally Schlech.

While working in Uganda, Schlech met Dorcas Nazziwa, a teen with a heart ailment. Schlech and his colleagues brought Dorcas to Halifax for treatment free of charge. Sadly, Dorcas did not survive, but her illness created a profound connection between the two communities that endures and strengthens.

Back then, Al Qassar had already completed a commerce degree with a major in marketing. He was working in advertising and offered to re-design Uganda Venture’s logo and help with the fledgling group’s marketing plan. Since then, Uganda Venture has been a central focus of his life, and he is often on the road.

The last few months have been exciting. In addition to linking up with LeBrun, Al Qassar has participated in the first cohort of the social entrepreneurship program at the Pond-Deshpande Centre at the University of New Brunswick. The six-month B4 Change accelerator program helps social entrepreneurs — those who found a business that meets a social, economic or environmental need and turns a profit.

“Often, accelerators are focused on technical organizations, but B4 Change had a good mix of social entrepreneurs,” Al Qassar said. “It brought in intelligent people who wanted to learn where we wanted to go and who wanted to help us bridge the gap.”

Additionally, the centre awarded Uganda Venture $15,000 toward its work providing micro-credit.

MBA students from Halifax’s Dalhousie University have also provided assistance. They gave accounting and financing training to the recipients and provided valuable evaluation of the group’s first year providing loans.

According to LeBrun, the Uganda Venture team is led by special people who have accomplished amazing things in Uganda and for the Canadians who have partnered with them.

But Al Qassar feels he’s the lucky one.

“For me, it feels awesome, satisfying and a privilege to be working with the people I’m working with and serving the people I’m serving.”

Building Startups in Rural Areas


Having spent a career in rural economic development, Andrew Button was blown away when he discovered the potential of startups in creating jobs and wealth. Now he’s using the startup model to encourage economic growth in rural communities.

He was the CEO of the South Shore Business Growth Association when he began to notice a few years ago that new tech businesses were growing strongly. He heard about the growth prospects from entrepreneurs like Blair Ryan of the Rounds and Leah Skerry of Norex, two Halifax tech companies.

 “I was working in the business development role for eight years, and none of this hit my radar,” said Button, sitting on the sun-strewn deck of a Mahone Bay coffee shop last weekend. “This got me to thinking that businesses in my community are just not aware of this.”

As a result, Button formed MashUp Labs, an organization devoted to nurturing startups on the South Shore. Button, who is also chairman of the Acadia Centre for Entrepreneurship at Acadia University, has a network that spans the province, and he intends for MashUp Labs' reach to extend throughout the province, the region and beyond.

Button has been studying how startups are formed and the resources they need. He said the model can be exploited more fully in rural settings. MashLab is not an accelerator like Launch36, he said, but it can bring entrepreneurs together, flesh out their ideas and prepare them for such accelerators.

So far, MashUp Labs has worked with the Hub South Shore in staging events to bring together entrepreneurs and potential entrepreneurs and familiarize them with the ways of startups. It has invited Ryan and others to come in and talk about their businesses and held instructional sessions on methods in growing lean businesses.

For example, Alistair Jarvis, executive producer of gaming studio Orpheus Interactive, led a session on the uses of a lean canvas, a digital device entrepreneurs use to plot the course for a business.

What was interesting about the session was the range of entrepreneurial pursuits of the 20 or so South Shore residents who attended. One person was developing a data analytics startup, another a mobile app and another a biotech company. One is working on a project to recycle coffee grounds.

Button stressed during the interview simply how many businesses — and people who have ideas for innovative businesses — there are in rural communities. They simply need some guidance in getting these off the ground, he said.

Button plans to continue with these programs and to link the startup community with the young, growing businesses on the South Shore. Beyond that, he said he wants MashUp Labs to work with a range of startup entrepreneurs.

 “It’s not a stretch to think, how do we bring this to any community with socio-economic challenges in North America, and combining it with the work of, say, a Launch36.”

Using Social Media to Fight Violence


LifeRaft, a Halifax startup focused on detecting signs of dangerous behaviour on social media, will launch its beta test this week with the participation of several educational and law enforcement groups.

LifeRaft is a social media monitoring tool that detects language signalling threats, cyberbullying and other signs that people may pose a threat to themselves or other people.

While most social media monitoring systems are used in marketing or measuring public opinion, LifeRaft is designed to help educational bodies and law enforcement agencies ensure public safety.

The company is being spun out of Citrus Mobile Solutions, a Halifax tech consultancy best known for its mobile real estate product TxT2look. The firm has spent about eight months developing LifeRaft and is now launching a 30-day test.

Three U.S. universities, a Canadian university and half a dozen law enforcement agencies are participating in the test. Citrus is planning a full public launch of the product once it assesses the results.

The tool “allows us to listen to what’s going on in social media and drill down and see what’s happening on a granular level,” said Citrus CEO Brian Perry. “We can understand the context of their discussions and in most cases can identify their geo-location.”

LifeRaft aims to help solve several serious issues. It can detect cyberbullying and therefore help schools, universities and school boards intervene before bullying results in a crisis. It can help identify people who strongly resent authority or the police, or could even be planning violence at a school.

Using LifeRaft, authorities can tell in real time who posted the questionable material and where they are, and can even see an archived street view of the building they are in. Authorities can also follow people of interest to make sure their social media posts don’t indicate they’re about to do something violent or harmful.

Perry said the device does not violate people’s privacy because social media posts are public information and police departments already monitor it. For example, the New York Police Department already has 12 employees assigned full time to monitoring social media. LifeRaft will simply improve the efficiency of such work, said Perry.

Citrus has been working with several partners in developing the product, including the Saint Mary’s University Sobey School of Business and the computer science department at Dalhousie University.

Perry said Citrus plans to develop LifeRaft as its own company, with the new entity employing about eight of the 10 people now working in the service company.

He said Citrus expects to be able to continue with its other work, in part because it contracts out to overseas developers. In the past year, it has even helped two of these programmers move to Halifax from Uruguay.

To finance the early development of LifeRaft, Perry and his team are now working on raising $1.5 million in seed financing. They have started talks with a few potential investors, he said.

Citrus’s main activity is custom software development, focusing on building and managing SMS communications and mobile technology platforms. The company evolved into this line of work by initially launching and operating SaaS text message solutions for the real estate and mobile marketing industries.

Our Anti-Spam Policy


As Canada’s new anti-spam legislation went into effect yesterday, we want to assure our readers that we respect their privacy and to clarify our policy on spam.

Every single person receiving our daily email does so because they left their email on our website. We therefore felt no need to pester people with emails asking them to confirm their wish to continue.

If you now receive the emails and wish to stop, please use the unsubscribe function at the end of each email. If that doesn’t work, please contact me at peter@entrevestor.com and we’ll remove you from the list.

At the same time, if you don’t receive our daily updates and would like to, please leave your email address at the bottom of our homepage. 

The Mentra Grows in Atlantic Canada


The Mentra Co-operative, a new initiative dedicated to developing a network of mentors throughout Atlantic Canada, has launched in New Brunswick and is looking for members from other provinces.

In early June, The Mentra hired as Executive Director Janna Hare, a coach, management consultant and training expert. And the organization is now building an online platform that will serve as a dating service between mentors and mentees.

Mentra was created by a group of organizations in New Brunswick that identified the need for a broader and deeper pool of mentors to help entrepreneurs develop their business. As it’s the home of the Launch36 accelerator, New Brunswick already has the best pool of business mentors in the region and now they want to improve it.

“There are a lot of organizations that are keenly excited about this,” said Hare in a phone interview on Friday. “The vision for the Mentra is to become a centre of excellence for mentoring, and we’re going to partner that with several organizations and develop these relationships to make it happen.”

Hare’s mission now is to train not only more mentors but more mentees as well. One of the curious aspects of mentorships is that the parties receiving lessons have to be prepped as thoroughly as the teachers themselves, otherwise the advice falls on deaf ears.

Hare is a certified coach and she plans to build coaching skills into the fabric of the program to encourage the development of both mentors and mentees.

She said the online platform for the group is now in development and the full service should be launched by the end of the year.  The beauty of the platform, said Hare, is that it allows the co-operative to link mentors and mentees in different locations. Entrepreneurs participating in the program will be asked how important it is to them to meet face-to-face with their mentors. If it’s not important, the network could allow founders to work with mentors in other locations.

One of the priorities now is to attract member organizations from other provinces for two reasons: first, it will allow more companies to benefit from the project; and second it will broaden the pool of mentors, in terms of numbers and expertise.  

“I have had a couple of conversations with Innovacorp in Halifax,” said Hare. “They’re keenly interested in the training program. Entrepreneur’s Forum will be in the list. I’m reaching out to people to see … how to have a strong mentoring network in all four provinces in Atlantic Canada.”

The development of the Mentra began last year when the New Brunswick Government put out a request for proposals for an organization to mentor entrepreneurs, and seven organizations came together with a single proposal, which won.

The Mentra will operate out of the Venn Centre (formerly Tech Southeast) on Main Street in Moncton. The founding members are: The Wallace McCain Institute; BioNB; the New Brunswick Business Council; Planet Hatch; the Pond-Deshpande Centre; the Venn Centre ; and the New Brunswick Social Policy Research Network.

They have held discussions with other members who may become members, including: Propel ICT; the New Brunswick Information Technology Council; the University of New Brunswick's Dr. J. Herbert Smith Centre for Technology Management & Entrepreneurship; the New Brunswick Community College; 21inc., and Conseil économique du Nouveau-Brunswick.

 

 

Press Release: EY’s Analytics Centre


EY, the global accounting and business consultancy, announced the opening of the Canadian Centre for Advanced Analytics in the following press release:

EY opens Canadian Centre for Advanced Analytics in Nova Scotia

HALIFAX, June 27, 2014 - EY is empowering Canadian businesses to capitalize on the transformational power of data analytics, with the launch of its Canadian Centre for Advanced Analytics (CAA) in Halifax today.

"In times of increased competitive pressure, businesses are constantly looking for innovative ways to grow and improve bottom line performance," says Jim Lutes, EY Atlantic Managing Partner. "Data analytics can help organizations improve their performance through driving better business decisions. This Centre exemplifies our commitment to supporting clients through the acquisition of talent, delivery of resources, technology and, above all, analytics insights."

EY's Centre will leverage the rich talent pool right here in Atlantic Canada to build its dedicated team, which will serve clients across Canada and around the world.

"Atlantic Canada – Halifax in particular – has been selected as the hub for analytics in Canada at EY and we're very proud of that," says Steven Maynard, Performance Improvement Partner in Halifax. "EY's investment to grow this capability in Atlantic Canada, along with our recent acquisition of Ambir Solutions, the leading independent IT and business consulting firm in Atlantic Canada, will support our efforts to respond to the significant demand for analytics.  We are currently serving clients from around the world from our new state of the art Centre at RBC Waterside place.  We will continue to expand both in numbers and capabilities in the coming months."

EY's opening of the Centre for Advanced Analytics is not only a benefit to its clients, but also represents a boost for the Atlantic economy.

"Private sector investment is vital to Nova Scotia's economic growth, and EY's new centre is a positive example of the impact it can have in our province," says Nova Scotia Premier Stephen McNeil. "It also reinforces the strength, drive and innovation of our province's biggest asset — its people."

About EY's Centre of Advanced Analytics

The Center of Advanced Analytics (CAA) consists of a team of highly specialized Advisory professionals, part of EY's Performance Improvement Advisory practice. The CAA will support Canadian and Global EY clients to enable them turn data driven insights into improved productivity, competitiveness and growth.

About EY

EY is a global leader in assurance, tax, transaction and advisory services. The insights and quality services we deliver help build trust and confidence in the capital markets and in economies the world over. We develop outstanding leaders who team to deliver on our promises to all of our stakeholders. In so doing, we play a critical role in building a better working world for our people, for our clients and for our communities.

EY is proudly celebrating 150 years in Canada. For more information, please visit ey.com/ca. Follow us on Twitter @EYCanada.

EY refers to the global organization and may refer to one or more of the member firms of Ernst & Young Global Limited, each of which is a separate legal entity. Ernst & Young Global Limited, a UK company limited by guarantee, does not provide services to clients. For more information about our organization, please visit ey.com.

CTA@Boston Seeks Applicants


The Canadian Technology Accelerator at Boston, or CTA@Boston, is calling for applications for its coming cohorts.

The applications for the four-month program open on Wednesday and run until July 23.

The following is a description issued by the Canadian Consulate in Boston, which operates the program:

The Canadian Technology Accelerator in Boston (CTA @ Boston) is a 4-month immersion program that connects your business to the unique resources and contacts in New England to help accelerate your growth. The benefits of participating in the CTA and the resources in Greater Boston are highlighted below.

Program Placements:

Fall/Winter

Winter /Spring

Spring/Summer

WHO:

Accelerator candidates are small to mid-sized Canadian companies from Life Sciences, ICT (Including Green IT and Health IT), Robotics and Security technologies, and emerging food product sectors, with initial traction in the market, differentiated technology, and potential to scale the business through the CTA experience in Boston.

WHY: Benefits of participating in the CTA@Boston:

•Space/services at the Cambridge Innovation Center in Kendall Square for up to 4-months

•Trade Commissioner's Assistance – including connections in the territory to help meet your goals.

•Mentors – from the Canadian Entrepreneurs in New England (http://www.TheCENE.org)

•Pitch Coach to refine your investor, partner, or client-focused presentation

•Member privileges at key industry associations

•Introductions to potential industry partners/funding groups/customers

•Weekly CTA Client Newsletter highlighting upcoming events/opportunities

You’ll find the following resources in the Greater Boston area:

•Over 400 biotechnology companies

•R&D sites for global pharmaceutical companies

•Strong tech cluster (Microsoft, Google, Amazon, EMC, Akamai, IBM,Nuance,…)

•World renowned research institutions (MIT, Harvard, Tufts, Northeastern)

•Venture Capital Firms, Corporate VCs and Angel investors interested in Canadian technologies

The online CTA@Boston application opens Wednesday, July 2, 2014 through Wednesday, July 23, close of business. 

Press Release: Oris4-Box Deal


Halifax-based Oris4, which has developed a cloud-based document-organization system,  has issued the following press release:

Oris4 Integrates with Box to Simplify File Migration and Discoverability

Palo Alto, Calif. — June 30, 2014 — Oris4 today announced a new integration with Box. The integration makes it easier for businesses to search for content across various software applications and provides the option of migrating it to a centralized cloud-based platform like Box.

When files are stored on numerous applications, such as network drives, email or legacy software, users often lack a secure and simple way to find what they are looking for from any device. According to an IDC report, information workers waste a significant amount of time each week dealing with a variety of challenges related to working with documents. This wasted amounts to a loss of 21.3% of the organizational total productivity. For organizations with 1000 employees, this time wasted would equal hiring an additional 213 workers.  Many organizations try to solve this challenge by building expensive interfaces between systems that are expensive and difficult to maintain. Instead, the Oris4 and Box integration greatly improves the discoverability of content with an easy point and click search method that gives a centralized view of an organization’s files, while also providing customers with an affordable way to either synchronize or migrate their content to the cloud.

“The biggest organizational expense firms are trying to grapple with is the time wasted searching numerous information repositories” according to Reza Kazemipour, CEO of Oris4. “People just don’t know where it is or how to find it. Box is a powerful platform for content management and collaboration in the cloud, and their customers are challenged with migrating all of their most important files from disparate, legacy solutions. We make finding all of this easy but clients were asking us if certain content can simply be moved directly into Box making it the ultimate online repository.”

The partnership between Box and Oris4 does just that providing a simple UI making things findable and by offering enterprise the ability to sync or migrate content from a current source into Box.com. 

About Oris4

At Oris4, we automate the organization of content. Oris4 is an easy to use and scalable cloud content management system that delivers real ROI for business as soon as you install it. The system gathers and indexes information from sources such as Box, Salesforce, network drives and email, organizing it in a manner that lets you find anything in a few clicks. Each file is linked to the people or companies you are working with and available to you regardless of how and where it was saved. For more information visit Oris4.com/box.

Ryan’s New Take on Maternity Wear


Like most women, Danielle Ryan struggled to look stylish when she was pregnant with her daughter, Penny-Laine.

Her clothes strained at the waist and it was hard to feel comfortable. The lifelong fashion lover decided women needed clothes that would expand throughout their pregnancies. When she failed to find the clothes she wanted, her company Penny Posh was born.

That was five years ago. Ryan, previously a director of business development for an Alberta land company, turned herself into a clothes designer, coming up with two novel garments: a sleek faux-leather jacket and a cosy hoodie. Both have subtle stretch panels in the sides that expand as the mother’s body grows and shrink back after she has given birth, while still allowing space for a baby to snuggle in close to Mom’s body.

St. John’s-based Ryan launched her venture in November. Her clientele is now growing and so is her product line.

“I was surprised at how difficult it was to find maternity wear that would fit my blossoming body and still allow me to feel sexy and stylish at the same time,” she said by phone from her Newfoundland base.

“The St. John’s climate reminded me of the need for maternity jackets that will zip up over a growing belly and remain zipped. When I was pregnant, I had broken zippers all the time,” she said with a laugh.

It took Ryan four years to learn how to design clothes. She was helped by Julia and Bonnie Cook, a mother and daughter team who co-own Newfoundland company AbbyShot Clothiers.

“I would send over sketches and Julia would forward them to their technical designer,” Ryan said.

“Bonnie helped guide me on the business side of manufacturing, and they also facilitated my manufacturing overseas.”

The new entrepreneur has also been fortunate with her father, Bruce, who is her financier.

“After watching me work on these designs for four years, Dad saw my passion and financed my whole project.”

Ryan’s garments are sold at Bellies & Bundles Maternity Boutique in St. John’s, but her focus is on growing her online market because online retail allows her to keep more of her profits and expand her client base nationally and even internationally.

So far, most of her clients are based in St. John’s and Ontario, but she is working with a branding firm on putting together a pitch in the hopes of selling her clothes to large American department stores.

“Our fake leather jacket currently sells for $139. Our mid-level price points are perfect for medium- to higher-end department stores. We think it’s a good fit,” she said, “excuse the pun.”

Despite being new to this line of work, Ryan feels she has got off to a good start. She credits her early Facebook party and her launch, which was held in conjunction with the national Oh baby! magazine, for giving her business an initial splash and attracting early clients.

“I’d highly recommend this kind of partnership to anyone starting out. You want to reach as many people as you can.”

She had initially planned to call her company Penny-Laine after her daughter and was disappointed to find the name heavily trademarked.

“But Penny Posh is working out. My faux leather jacket is posh. It looks and feels real. It’s the image we’re after. The name flows nicely.”

She is working on new designs for a blazer and leggings that will be available this summer. Jeans, which are unexpectedly tricky to design, are planned for the fall.

Stewart: Lessons in Civic Open Data


I like to think of myself as a pretty creative person. This past weekend, however, I got to meet a whole lot of creative people – many much more creative than me. 

I was privileged to experience firsthand what happens when you put a bunch of these insanely creative people in the same room for two entire days.  This is exactly what happened at the True Growth Civic Hackathon this past weekend.

Hosted by the University of New Brunswick’s Maker Space, this civic hackathon was incredibly timely considering the perfect storm that is now under way. With the current trend for global urbanization, leaders need to find innovative solutions to make their infrastructures work in ways that they were not originally designed for. The convergence of technology and the vast amounts of data now available translates to an infinite number of innovative possibilities.

Today’s cities have access to inexpensive technologies capable of capturing and storing huge amounts of data. This data can be sensor data taken from wireless traffic cameras, infrastructure monitoring of buildings and bridges, mobile health and fitness, and people tracking to name a few. Government organizations also have access to many sources of data ranging from property tax assessments, geographic mapping, and location based service information.

It has been recognized that sharing such data can lead to things like smarter transport, lower energy consumption and increased efficiencies and productivity.

Over the course of the sunniest weekend that I can remember, this civic-minded event focused on ‘people solving problems for people’ using open data. That is, data that organizations make available to the public without restriction on usage or distribution. Making such data open has the ability to transform a city by increasing transparency of governance and enabling outside expert collaboration. The reality is, most government agencies do not have the resources to create innovative solutions, nor do they typically enjoy a culture that allows for failure – a prerequisite of innovation. Allowing citizens to apply their specialized skills and localized knowledge from an outside perspective is a powerful model that benefits from experimentation.

The group of 20+ civic hackers present was complemented with people traveling from other cities, and even other provinces to compete. Imagine, people care enough about making a difference that they are willing to invest in traveling to another province to help solve problems. Good food, great conversation, and new friends made sitting inside during this first weekend of summer awesome.

At the end of the weekend, there were three amazing products completed.  These ranged from a portal to all pertinent information on a given address (see civic311.com), an interactive virtual city tour, and a service to find the location of the most desirable parking spots in the city.  All of these were built using open data, which, as we all quickly found out, is scarce.

This event should serve as proof of the value of open data. Despite how open the government claims to be, we still have a long way to go.  For example, we may have ‘access’ to property tax information, but it is not ‘open access’. 

Open means unrestricted.  Open means sites like propertize.ca would flourish – the very site that property assessors are rumoured to use themselves because it is better than their own site.  Need another example?  Try to obtain your city’s geocoded civic addresses, something you can create yourself if you know how, just to see the restrictions placed on it and anything you build on top of it.

The true smart city empowers its citizens from the bottom up to create a living lab.

The true smart city empowers its citizens from the bottom up to create a living lab. While there are glimmers of brilliance being shown in the innovative work being done across city departments like transportation, energy, and public safety. This is just the beginning as the real data mining and analytics opportunities arise from opening all data and combining these datasets together. Powerful transformative insights exist in these combined open datasets, and they are just waiting to be unlocked to provide useful patterns, trends and predictive power. Tim Berners-Lee tells us of the innovative power that comes from blending different data sources together to enable people to do “wonderful things in ways we would never have imagined”.

‘Government 2.0’ should be in stark contrast to the opaque, “we know better” attitudes of current bureaucracies and needs to embrace the power, innovation, and insights that the crowd will bring to advance good governance. Government should not squander the opportunity to shine a very bright light on its practices with open data (such as pseudo-open policies that attempt short-term gains by monetizing access rather than seeking the big time savings that will come from innovation by allowing open access by all to all).

Every elected government in the free world claims they are simply interested in improving on the cost effective delivery of their systems and programs; if this is indeed a core value, then there should be no hesitation in inviting the electorate to scrutinize their performance and provide valuable feedback and innovation to achieve improvements in cost and service.

There are very few options for governments to both reduce spending while increasing economic activity, but embracing an open access approach just might provide that opportunity. The spoils will go to the government who chooses to take a leadership role in fostering technology innovation in big data analytics by adopting true open-access.

 

James Stewart James Stewart, Ph.D. candidate,  is an intelligence analyst at Predexa Analytics and teaches data mining at the University of New Brunswick. This blog first appeared on the Predexa website. 

 

 

SimplyCast Aim: Double Sales Monthly


As he prepares for a lengthy sojourn in Silicon Valley, Saeed El-Darahali laid out a lofty goal for his Dartmouth company, the multi-channel marketing startup SimplyCast.

He wants it to at least double its revenues monthly.

That’s right. Double its sales or better. Every. Danged. Month.

SimplyCast was founded in 2009 as a platform-as-a-service product that would help companies and organizations carry out marketing and communication campaigns over email, social media and a range of other channels. A year ago this month, after three years of development, SimplyCast launched its flagship product, the 360 Automation Manager, which allows incredible ease of use in these campaigns.

The product is selling, and revenues are rising at 30 per cent per month, but that’s not enough for the company’s founder and CEO.

“I want growth percentage up to triple digits per month,” said El-Darahali in an interview at the company’s headquarters. “Five per cent is OK, and 50 per cent is good but not good enough. But 100 per cent would be super.”

El-Darahali has never lacked ambition. When the native of the Middle East left his job as a fund manager at Innovacorp in 2009, he said his goal was to build a $1-billion company based in Nova Scotia. He’s never deviated from that goal and never lost his belief that SimplyCast could be such a titan.

The company has grown to 34 employees, virtually all of them in Dartmouth. (One is in South Korea because his wife took a job there.)

The company is not on a hiring binge because El-Darahali believes he has the firepower he needs to drive sales with the 360 Automation Manager.

Certainly, customers have been rolling in lately. On June 3, the company, which already had clients in 175 countries, reported that customer totals of SimplyCast 360 increased 266 per cent in the first quarter.

Customers who have signed up include the Make-A-Wish Atlantic Provinces foundation and cartoonist and marketer Stu Heinecke. SimplyCast has not revealed all its customers, but El-Darahali said they include two banks in the United States and several government agencies.

El-Darahali said the focus of the company is on revenue growth, whereas for the first three years the critical mission was building the platform.

“We couldn’t have had the revenue growth that we’re now seeing if we’d focused on revenue at the start,” he said.

SimplyCast was formed with $758,000 in financing from Innovacorp and Nova Scotia angels. El-Darahali has never raised money outside Nova Scotia. He said he’s been approached by two or three potential investors, purchasers or strategic partners every week but has so far not signed a deal.

“We continue to look for the right partner, but we don’t need the money,” he said. “We haven’t found the right partner yet, and we’re not on our knees.”

Yet within the next two months, he will head to Silicon Valley to meet with potential partners. His options for financing further growth include a public listing, venture capital, private equity or a strategic partner. But he emphasized his main goals for the company — a billion-dollar enterprise based in Nova Scotia — have not changed.

“The public markets are one of the options we would look to in the future. But we want to build this company properly and keep the headquarters in Nova Scotia.”

Revolution in Newfoundland Funding


There’s a quiet revolution taking place in seed funding in Newfoundland and Labrador.

When Newfoundland and Labrador Finance Minister Charlene Johnson unveiled in her spring budget that the province would participate in two venture capital funds, she was signaling her government’s commitment to improve funding for companies on the Rock.

The province’s government is on board with a strategy to develop more startups and is therefore radically altering the seed funding of young tech companies.

Most visibly, the province has announced it will invest $10 million in Build Ventures, the regional VC fund. More quietly, it is working with GrowthWorks Atlantic, the Newfoundland and Labrador Angel Network and an as-yet-unnamed financial institution to develop the Venture Newfoundland and Labrador Fund. Complementing this effort, the government will soon allow private investors in the Venture fund to receive equity tax credits for the fund’s investments. In total, it will mark a huge advance in funding startups in the northeastern province.

“I hope that we can develop a community of funding societies here in Newfoundland and Labrador and across Atlantic Canada so that more of our entrepreneurs can be supported and help to grow our economy,” said Mark Dobbin, the founder of Killick Capital, one of the province’s prime funding bodies.

The most visible announcement so far was the investment in Build Ventures. The other investors are the three Maritime Provinces, the Business Development Bank and private investors, who together with Newfoundland have committed a total of $65 million.

Build so far has invested in tranches of $1.5 million, so the Newfoundland and Labrador government also wants to improve financing in the earlier phases of a company’s development.

An official with the provincial government, who asked not to be named, said startups in Nova Scotia and New Brunswick have an easier time finding seed funding than those in Newfoundland because of bodies like Innovacorp and the New Brunswick Innovation Foundation.

This Venture fund is meant to fill that gap, but it will be structured differently to allow maximum fire power. First, it will have a private fund manager in GrowthWorks Atlantic. GrowthWorks already has several investments in Newfoundland, such as Virtual Marine Technologies, adfinitum Networks and ClearRisk.

Members of NLAN will also be invited to invest in the fund. People in the community say NLAN has previously had trouble finding lead investors to identify target companies, draw up terms sheets and lead the funding. In the future, such tasks would be taken over by the fund manager. And the angels will be allowed to receive equity tax credits based on the fund’s investments. Newfoundland and Labrador’s current equity tax credit is granted only to individuals investing directly in Newfoundland companies.

The official said the government will contribute at least as much to this fund as it did to Build Ventures, meaning the new fund will be substantially more than $10 million. The hope is there will be a substantial body of money at the inception, and over time the government’s role in the fund will diminish as it attracts more private capital.

“We really feel that this is an area we have to build up to develop these great young companies,” said the official.

 

This article first appeared in our Spring 2014 Entrevestor Intelligence Report, which can be found here.

 

Resson Unveils Deal with McCain


Resson Aerospace, a Fredericton company that uses aerial imaging to improve farm productivity, has signed a multi-year memorandum of understanding with Canada’s largest food producer aimed at improving potato production.

The company unveiled its deal with McCain Foods Ltd. at an event Monday near Fredericton, at which Premier David Alward announced the province would invest $5 million in a research and development project with McCain.

The other startups involved in the project include Eigen Innovations, Solanum Genomics, Envirem Organics and Hyton Innovation.

Resson was co-founded by Peter Goggin and Rishin Behl in 2013 while they were studying at the University of New Brunswick. They came up with an idea to use aerial drones as surveillance mechanisms and develop software that can analyze the data they collect. The first application they came up with was an agricultural product, gathering and analyzing a range of data that can improve crop production.

Plants, like animals, undergo metabolic changes, including changes in their temperature, when they contract diseases. Resson’s system — which it calls the Resson Agricultural Management and Analytics System — detects these changes and reports it to the farm operator before the disease spreads. That means the operators can quickly address the problem in a contained area.

Tests have shown that the system decreased the chemical used in farming and increases crop yields.

“Our software is the brain behind the platform,” said Goggin in an interview. “Any imaging platform can capture images. Our software processes the information and generates the report.”

The company has just completed the Launch36 accelerator program and has been in talks with three major food producers. In April, it signed a three-year memorandum of understanding with McCain Foods to apply the management and analytics system to potato crops. The memorandum calls for a business relationship covering several years that is worth seven figures. It will produce $280,000 in revenue for Resson this year.

In his presentation at the Launch36 graduation last week, Goggin said the company continues to work with major agricultural companies involved in such crops as wheat and canola. There are other crops and industries that Resson hopes to focus on in the future.

“We’re working with McCain, working to tailor the system for potato production,” he said.

“Different crops react differently and need to be calibrated individually. But once it is calibrated, it can be used by anyone.”

It’s rare for a startup so early in its development to be working with such a large customer, and that may be why Resson Aerospace has already been able to raise about $600,000 in equity funding. Goggin said during his Launch36 pitch that the company is working on a funding round totalling $2.1 million — the largest target ever revealed in a Launch36 graduation pitch.

Goggin said one thing he and Behr learned going through the accelerator was to aim high.

“The biggest thing limiting a lot of Atlantic Canadian companies is a restrictive mindset. Launch36 taught us to go after the big fish and be a big fish. That mindset is critical.”

Press Release: Oris4’s New Features


Halifax-based Oris4, which has developed a cloud-based document-organization system,  has issued the following press release:

Oris4 to unveil latest integration at Salesforce.com event in Toronto

Oris4 will participate in salesforce.com’s Force1 World Tour event in Toronto on June 25th and unveil a new integration developed for a major telecom designed to help improve user adoption of salesforce.com’s social enterprise application, Chatter, while improving the company’s ability to quickly find files across multiple software applications like SharePoint, email and network drives via salesforce.com.

According to Google’s Eric Schmidt, “Every two days now we create as much information as we did from the dawn of civilization up until 2003. That’s something like five Exabyte of data.”  This massive amount of content is stored across numerous applications and the Internet and as a result is often difficult to find.

“Our previous integrations which automatically link files from SharePoint, email, and the most popular cloud-based file storage solutions were key in understanding how we can enhance the social enterprise experience” according to Reza Kazemipour, CEO of Oris4. “Clients were asking us how we could improve their ability to easily find previously shared presentations and relevant comments regarding the opportunities they were currently working on. Working with the client team really helped us design this offering and we’re ready to share that experience.”

According to IDC, information workers waste a significant amount of time each week dealing with a variety of challenges related to working with documents. This wasted time amounts to a loss of 21.3% of the organizational total productivity. For organizations with 1000 employees, this time wasted would equal hiring an additional 213 workers.  Oris4 helps clients gain back the lost time looking for and managing their files by providing an easy point and click search method that gives users a secure, centralized view of an organization’s files.

“During one of our presentations there was a lot of excitement. One executive said, “This will make us use salesforce even more.” said Peter Hickey, founder of Oris4. “That’s the fun part. Seeing something we built get the client excited. We’ve tied it all together; salesforce, the social enterprise, SharePoint, email and the cloud. We’re giving people a complete view of the information they require to make decisions and win business.”

Social enterprise software is gaining popularity within many organizations for its ability to share information and collaborate with colleagues organizations have adopted it as part of their culture. Oris4 allows for content shared within Chatter to be automatically organized and linked to relevant contacts, accounts and opportunities.

About Oris4

At Oris4, we automate the organization of content. Oris4 is an easy to use and scalable cloud content management system that delivers real ROI for business as soon as you install it. The system gathers and indexes information from sources such as SharePoint, Salesforce, network drives and email, organizing it in a manner that lets you find anything in a few clicks. Each file is linked to the people or companies you are working with and available to you regardless of how and where it was saved. For more information visit Oris4.com.

End

Populus Inks Major Deal in Barbados


Health information company Populus Global Solutions has won an international bid to supply the Government of Barbados with a fully-integrated national electronic health information system – its fourth major contract in the Caribbean-Central American market.

Fredericton-based Populus, which received a $260,000 investment from the New Brunswick Innovation Foundation several year ago, has commercialized software for running an electronic health information system, or HIS. It has been recognized by the World Health Organization as one of the best all-encompassing systems of its kind, said the company.

“We have developed a big data, health software product that manages more than 1 million transactions every day,” said Populus CEO Tristan Rutter in a statement. “Harnessing the power of our Canadian technology, governments like Barbados are proving that we can expand access to healthcare, reduce the burden of disease and save money all at the same time.”

Populus began to gain traction in 2007 when it sold a system to the government of Belize. Though located in Central America, Belize is a member of Caricom, the Caribbean Community, and word began to spread through the island nations of the strength of the Populus system. In the past seven years, Populus has installed national HIS products in St. Lucia and in Saint Vincent and the Grenadines, and now in Barbados.

In an interview, Rutter said the company did not set out to become a supplier to Caribbean customers but it simply gained traction there. And it hopes its success in Barbados can help it expand to other markets.

“What this really means to us is Barbados is a country that everyone knows,” he said. “The hospital is a 600-bed facility that does a full range of [procedures]. . . . “What Barbados means is to us is validation. It’s the opportunity to refine the process.”

Populus will provide every Barbadian citizen with an electronic medical record and electronically tie all its doctors, hospitals, clinics and pharmacies together under one cloud-based integrated system. The features of the system include: E-prescribing with inventory control; embedded disease management protocols; data analytics complete with real-time reporting; and billing.

“The entire system will be up and running within nine months at cost of less than ten dollars per citizen,” added Rutter.

He said the company’s priority in the near-term is to install the system properly in Barbados, but it is also planning to grow in more markets. It now has about 18 employees, 15 of them in Fredericton. It has only done one round of fundraising with NBIF and a group of angels mainly based in Atlantic Canada. The company’s board has discussed raising more capital, but has no immediate plans, Rutter said.

In the long-term, the company wants to get into the Canadian market and believes it can help governments improve service and save money. Rutter notes that Canadian healthcare spending rose 54 percent between 2002 and 2010 and that did nothing to improve mortality rates. He believes the country is at a crossroads in terms of healthcare and will have to adopt new technologies.

“Out of my office in Fredericton, I look out at the Department of Health,” he said. “Do I want my software running there? Yeah I do.”

Propel, BioAlliance Win CAIP Funding


PropelICT and the P.E.I. BioAlliance have been awarded five years of funding under the National Research Council’s Canada Accelerator and Incubator Program, or CAIP, which will allow them to expand their programing.

Prime Minister Stephen Harper announced in Waterloo, Ont., today that the federal government will devote $100 million to funding several organizations across the country, including PropelICT and the BioAlliance. Though the government did not announce the size of funding, it said no accelerator would receive more than $5 million over the five-year period and all recipients must come up with matching funds.

People familiar with PropelICT, the New Brunswick-based tech mentoring group that operates the Launch36 accelerator, say it will be sufficient to pay for a meaningful increase in the group’s work.

“It means we can finally scale our operations regionally in each of the Atlantic Provinces,” said PropelICT Executive Director Trevor MacAusland in an interview. “We’ll be taking the program and tweaking it a bit and developing programs based on various categories [of businesses].”

PropelICT was formed in Saint John 10 years ago to foster growth in the technology industry. In the winter of 2012, it launched its own accelerator, Launch36, with the goal of putting 36 startups through its program within three years. With the graduation of five companies on Monday, PropelICT has now graduated about 30 startups from across the three Maritime Provinces.

Headed by Executive Director Rory Francis, the P.E.I. BioAlliance is a not-for-profit organization that has brought together government, academics and private companies to nurture the life sciences industry on the Island. Its growth has accelerated during the last 10 years as the members of the alliance -- including Nautilus Biosciences, Island Abbey Foods and Neurodyn – have increased their activity and are now coming into their own.

In recent months, senior people within PropelICT have been talking internally about “Propel 2.0”, in which the increased funding will produce a richer program offering that extends across Atlantic Canada.  The plan involves working with various partners – including Planet Hatch in Fredericton, Volta Labs in Halifax and StartupNL in St. John’s -- to develop more and better tech companies. The ultimate goal is to establish at least one billion-dollar company in the region.

MacAusland said Propel 2.0 will feature 12-week programs offered in specific locations so companies can go through the course without having to travel between provinces. The group is planning to offer cohorts at both PlanetHatch in Fredericton and Volta Labs in Halifax this autumn. Propel plans to have a program director who can travel to the various cities to conduct the programs.

In the future, Propel may offer sector-specific accelerators if it determines there is a critical mass of one type of company in one location that could benefit from the course.

“It’s incredible to have this opportunity to work organizations across Atlantic Canada and align our resources,” said Sally Ng, Executive Director of PlanetHatch. She added it is an “exciting next step in the evolution of our region and Planet Hatch.”

One of the strengths of the Propel programming has been its stable of mentors, many of whom are in New Brunswick. In the future, the accelerator will develop networks of mentors across the region, including Launch36 graduates who can help to coach a new generation of entrepreneurs.

Propel will also use the services of Moncton-based Clarity to link its entrepreneurs with thousands of international mentors. Founded by serial entrepreneur Dan Martell, Clarity links entrepreneurs and business people with the best advisers in different fields from around the world.

MacAusland said Propel, which now has two staff members, will likely expand to a staff of five this year with the goal of eventually increasing to seven people.

Propel has no plans to own a working space for its member companies as some accelerators do, largely because its mission is to mentor startups across a broad geographic area. Similarly, the group will continue to be a not-for-profit organization and will not be affiliated with a fund that invests in the companies it mentors.

The government announcement had been expected for several months, and follows an intense effort in October by a number of groups in the region to land the CAIP funding. 

Teaching Youth Art, Entrepreneurship


A strong smell of pizza, along with words like “futurepreneur” and “artpreneur” drift in the air as the first cohort of ArtPreneur 2.0 meet at the Halifax offices of the Centre for Entrepreneurship Education and Development, or CEED. This is the second of eight meetings for the young artists who are here to learn skills they hope will help them turn their talents into profitable businesses.

A collaboration between CEED and the Youth Art Connection, a group that partners with community organizations and professional artists to deliver programs that empower youth, the new eight-week business incubation program offers 15 young creators the opportunity to learn useful skills, such as creating a business plan.

“At (the art connection) we are very concerned about the issues youth are facing in Nova Scotia right now,” said Ryan Veltmeyer, co-founder of the organization with his wife Ann Denny.

“High youth unemployment rates, stress and mental-health challenges and a cultural gap with older generations, are some of the issues causing young people to leave our province for opportunities elsewhere in Canada.”

Veltmeyer, himself a musician, said it makes sense to teach artists business skills as “every artist is an entrepreneur, but artists wouldn’t think to go to CEED.”

The students are receiving business training from CEED staff and mentoring from Veltmeyer, Denny, and hip-hop artists J-Bru and Shevy Price. The young artists will also attend off-site meetings, workshops and individual coaching sessions with the goal of designing a professional-level product or service by the end of the eight weeks.

“I’m hoping I can get the tools, help and advice I need to propel my business to the next level. Currently I’m selling my jewelry through word of mouth and online, but I want to make a name for myself here in Halifax,” said participant Aaron Stevens of X.A.C. Productions.

This is the first of this kind of program for CEED, although the organization has over a decade of creating programs that connect youth to the workforce through either entrepreneurship or employment.

CEED education and small-business consultant Melissa MacMaster said the students in this group are younger than those in regular cohorts and the program has been adapted to their specific needs. Students are looking at creative industries in some depth. All the artpreneurs will present and pitch their product or service at the ArtCeleration event on July 8 at the offices of sponsor McInnes Cooper.

As he sat down, pizza in hand, ready to learn how to write a business plan, rapper Nima Tabatabaei, 18, said he has been rapping since he was 12 and had decided it was time to learn the business side of the music industry. “I’ve learned a lot so far,” he added.

AVF, Launch36 Prove Our Progress


To assess the superb quality of the companies on display in Halifax this week, we should start with Charlottetown drug discovery company Neurodyn, which captured the best growth stage company at the Atlantic Venture Forum.

It’s difficult to highlight just this company.  You could choose DeCell Technologies of Halifax, which won the award for the best early-stage company.  Or any of the five companies that pitched Monday night at the Launch36 DemoDay. Or the other 24 startups that presented at the AVF. You could even focus on topLog of Halifax, which missed these events but was at metabridge 2014 in Kelowna, B.C. as one of the Top 15 startups in Canada.

Suffice it to say the quality of these young companies was exceptional. It can be seen in the comments from visiting venture capital fund managers, who validated the feeling in Atlantic Canada that our startups can compete anywhere.

“At Launch36 last night, the teams were incredible,” Jeff Grammer, a Boston-based Partner with Rho Canada Ventures, said Tuesday. “They were equal to or better than the teams we see at accelerators across Canada. The energy and camaraderie were incredible.”

Let’s focus on Neurodyn, which specializes in treating diseases of the brain such as Parkinson’s Disease and Alzheimer’s Disease. Last year, it bought a drug candidate called Memogain, an updated compound that had already been developed and commercialized in Germany. Neurodyn bought the drug because it displayed stronger treatment powers than existing drugs for Alzheimer’s, with none of the awful side effects such as diarrhea.

Neurodyn Executive Director Bob Cervelli said the company decided to test the drug not on old people with dementia problems, but on young, healthy people. They gave some college students a battery of cognition tests, gave them Memogain (some received a placebo) and then had them take more tests. The cognitive powers of those who’d taken Memogain increased dramatically.

“We saw not side effects – we expected that,” said Cervelli. “But we noticed improved memory performance, and this is in healthy adults.”

He added the drug could have an accelerated regulatory process for two reasons: first, there has not been a new Alzheimer’s medication in 11 years so the Food and Drug Administration has lowered the bar somewhat for such drugs; and second, Memogain is a derivative of a previously approved drug and can build on previous tests.

The company, which is also developing other drugs, is now looking for $10 million in equity funding to finance the development of Memogain.

Neurodyn is a graphic illustration of the great stories being told by Atlantic Canadian startups, and I don’t have the space here to tell the others.  But the written AVF program shows how a broad range of our startups are performing, because it reveals the revenue data for 22 of the 26 startups that presented at the forum.

In 2013, these companies reported total revenue of $4.0 million. Ours is a young startup community and only seven of these companies had sales of more than $20,000 last year.

We’re now half-way through 2014 and these companies have a pretty good idea of their sales for this year. They estimate a total of $13.8 million – an increase of almost 250 percent. Eight of the companies are expecting to book revenue of $1 million or more.

As for their forecasts for 2014, you would expect startup founders to be optimistic about their prospects. So we could take this with a sizeable grain of salt. But for what it’s worth, these 22 companies are forecasting $56.9 million in revenue in 2015 – a gain of 13 times over 2013.

If these projections miss the mark by 50 percent, these companies will still report better than 600 percent revenue growth over two years. It speaks to the quality – not to mention the breadth of markets – on display this week. 

Car Service Uber Comes to Halifax


Uber, a car-for-hire service that’s created controversy across the continent, has come to Halifax.

The San Francisco company announced Wednesday that it has launched its service in Halifax, so a fleet of drivers can now use its app to communicate with customers and accept payments.

Uber, which began five years ago, provides users with a smartphone app that takes their credit card number and connects them with a fleet of cars. When users need a car, the app shows a map of their immediate vicinity and outlines what cars are nearby. They can view the ratings of each driver as determined by previous users, order the car they want and watch its progress on the map. The rider doesn’t have to fumble for change at the end of the trip because the ride is paid for through the app and a receipt emailed out immediately.

 “It’s great to see this spreading across to Halifax now,” said general manager Ian Black in an interview at the Atlantic Venture Forum in Halifax on Wednesday. “What’s important for us is to offer a high level of service to our customers.”

Uber offers taxi services in some cities and black car limousine services in others. For example, it offers both services in Toronto and just a taxi service in Montreal. Halifax will be its third Canadian city and will offer only the black car service at first.

In entering other markets, Uber has met with strong opposition from both taxi operators and those that regulate the industry. Reuters reported last year that Uber has faced licensing offences in Toronto, been declared illegal in New York, and served with cease-and-desist orders by regulators from California to Massachusetts.

The problem is that Uber either is a taxi service or performs many of the tasks of a taxi service, and taxis are a heavily regulated industry. Taxi operators usually require licences, so some jurisdictions have tried to have Uber behave like traditional taxi companies.

 “The problem is that the laws weren’t written to account for technology that exists today,” said Black. “In most cities, taxis are a large and entrenched lobby group, so they pushed back.”

What many drivers have found over time, he said, is that Uber actually helps them because the service allows them to make more money. Riders also prefer it, he said, because it allows greater flexibility contacting, selecting, rating and paying drivers.

Uber began four years ago when founders Travis Kalanick and Calgary native Garrett Camp grew tired of waiting for cabs in San Francisco, so they developed a smartphone app that would improve the experience of ordering a cab. The company has since spread to 140 cities, notwithstanding the controversy. Black said the company has lined up a fleet of Halifax drivers — he wouldn’t say how many — and users can now download the app on Uber.com.

Press Release: SHIFT in Vancouver


SHIFT Energy, a Saint John company that is developing automated energy-control systems for large facilities, issued the following press release yesterday with Canucks Sports & Entertainment:

CANUCKS SPORTS & ENTERTAINMENT IMPLEMENTS NEW GREENING MEASURES AT ROGERS ARENA

17 June 2014, Vancouver, BC

Canucks Sports & Entertainment (CSE), in conjunction with SHIFT Energy, announced the launch of a comprehensive, automated Energy Optimization System (EOS™) at Rogers Arena. As part of CSE’s commitment to environmental sustainability and energy conservation, SHIFT’s EOS solution, the first enterprise-wide Intelligent Live Recommissioning solution on the market, will allow for significant reduction in energy consumption. 

 “As a live events facility, Rogers Arena has a dynamic, complex footprint of energy usage,” Al Hutchings, Director of Facility Operations and Engineering at Rogers Arena.  “EOS™ is able to fine-tune the entire facility from HVAC to chillers to lighting - optimizing the facility in real-time, while respecting our event management needs.  We feed the EOS™ solution with our event needs and the system takes care of the energy and space planning, continuously adjusting the equipment setpoints for optimal efficiency and performance.  The result is big savings without significant changes to our daily operations.”

EOS™ began as a pilot project in June of 2013.  After six months of development and another three months of engineering implementation, EOS is live at Rogers Arena, saving 14 percent of total energy in the arena. 

“We were very pleased to have the Canucks collaborate with us on the development of EOS™,” Brock Sansom, President and CEO of SHIFT Energy said commenting about the launch. “The joint effort has produced an excellent result – establishing a new paradigm in building energy management.  When big data analytics, cloud computing and the Internet of Things are combined with engineering principles, a new era of energy waste reduction begins.  We have taken an ‘intelligent-ready’ building and truly made it an ‘intelligent building ‘.”

The sophisticated intelligence powering EOS™ is a collection of patent-pending algorithms that have been developed by SHIFT over the past five years.  These algorithms, combined with recent technological advances, have enabled EOS™ to derive a new, optimal energy plan for a building each minute of the day and immediately action the plan using the existing building automation systems.  EOS saves $.30 to $.80 per minute for each building, resulting in an average annual portfolio energy savings of 15% to 35%.

About Rogers Arena

Owned by Canucks Sports & Entertainment (CSE), Rogers Arena is home to the Vancouver Canucks of the National Hockey League and operates as one of the most active and versatile entertainment venues in North America. Rogers Arena has welcomed more than 23.6 million visitors through its doors since opening in September 1995.

In March 2011, CSE became a founding member of the Green Sports Alliance along with a num­ber of professional sports teams based in the Pacific Northwest. This alliance offers the opportunity for leagues, teams and venues to build on individual greening initiatives by working together to implement effective, science-based and measurable environmental programs. Concourse recycling and food waste disposal are now available for fans to use.

Singh Sets Sites on Incubators, Grants


When Paul Singh speaks, it’s usually a good idea to forget the F-bombs and concentrate on the wisdom and candor of the other 60-percent of his speech.

When he returned to the Atlantic Venture Forum yesterday morning, he set the tone for the discussion for the rest of the day by challenging some of the pillars of the Atlantic Canadian ecosystem, including the availability of government grants and the number of incubators and accelerators.

Singh is the founder of Disruption Corporation in Washington, D.C., which operates the $50 million Crystal Tech Fund. Last year, when he was with 500 Startups, he was the keynote speaker at the AVF. He has a tremendous global perspective because he travels constantly, visiting startup events around the world.

And his cheerfully foul-mouthed oratory Tuesday pulled no punches in telling entrepreneurs to sharpen their game and to realize they can compete with their peers in the U.S.

“I think you guys have a confidence problem,” Singh told local startup founders during a panel discussion. “Canadian founders have to realize they’re just as smart as their counterparts in the U.S.” (I must have a puritanical pen – none of the quotes I jotted down included his expletives.)

He bemoaned the politeness and lack of aggression of the entrepreneurs he meets in Canada, and said there is a huge problem with companies exiting too early in the country.

Singh has heard that Atlantic Canada has become the development shop of Salesforce.com due to the San Francisco giant’s acquisitions in the region. But he said the problem is founders are exiting too early and too cheap. So large American companies are buying startups “for pennies” because our entrepreneurs don’t have the resources or confidence to move through the growth phase.

Canadian venture capitalists and other investors should be looking at ways to let founders remain in business longer, he said. For example, U.S. investors are now doing growth-stage rounds in growing companies that would allow the founders to take money out of the company, improve their lifestyle and continue to grow the company.

Singh also warned that the startup community has to be more aware of the costs of growing businesses. “While it’s true that it’s cheaper than ever to start a startup, it’s also true that it’s never been more expensive to grow a business,” he said. “When you hire people, you have to pay them a market rate.”

His sharpest criticisms were for our dual reliance on incubators and grants.

On incubators and accelerators:  “Most of them misunderstand their goal. Most of them are this Kumbaya  thing rather than weeding out the companies that are failing.”

He said he hates going to accelerator demodays that are celebrations of mediocre companies. On the flip side, he loves going to the Start-up Chile demoday because the organizers announce how many companies started the program and how many graduated, highlight those that fell by the wayside.

On grants: “They’re a great idea but you’ve got a lot of living-dead companies.” He said the government grants let companies survive when they should be allowed to die so their employees can join more productive businesses. “A lot of talent is locked up in things that aren’t going to happen.”

Not everyone agreed with all of Singh’s views. Keynote speaker Dan Park, the Calgary-based Vice-President of Azure Capital said he likes the opportunities for leverage that are offered by so many government programs.

Park’s speech outlined the opportunities for e-commerce in Canada. He noted the market is now dominated by Amazon, which is growing in Canada. That’s a good thing because it will lower shipping rates and develop a greater mindset among Canadian consumers to buy online. That will create opportunities for Canadian entrepreneurs.

 

Proposify Named to Techvibes 20


On the day it delivered a superb pitch at Atlantic Venture Forum, Halifax-based Proposify was named Tuesday to the Techvibes 20.

Launched in February, the Techvibes 20 is a bi-monthly list of the hottest and most promising tech startups across Canada. The list is carefully curated by Techvibes editorial staff and reflects who's making waves in our nation's tech ecosystem right now.

Proposify’s founders Kyle Racki and Kevin Springer recently sold their web design firm Headspace Design so they could concentrate full time on Proposify. Formerly called PitchPerfect, the company helps service providers produce professional-looking written proposals.

The company has about 20 paying customers and raised a funding round of $670,000, including an investment from Innovacorp and loan from the Atlantic Canada Opportunities Agency. 

Launch36’s Cohort 4 Focuses on Sales


A few hundred startup enthusiasts gathered at Pier 21 in Halifax on Monday evening to graduate the fourth cohort of tech companies from Launch36, the regional startup accelerator.

While the headline story is five more tech companies progressing into the real economy, the deeper story is about the quality of great mentorship growing out of New Brunswick and spreading through the region.

Dealing with the headline first, the graduating companies include:

Adeptio, Charlottetown, which offers software and programs for personal coaches;

HotSpot Parking, Fredericton, which allows for remote payment of parking meters and helps small businesses manage customer relationships;

• KinderGuardian, Moncton, which is developing a game monetization platform;

Qimple, Moncton, which helps companies to manage and analyze applications when hiring people;

• And Resson Aerospace, Fredericton, whose aerial surveillance system helps farmers detect crop diseases.

What was impressive about the pitches was the emphasis on revenue. KinderGuardian was only devised in January, and is therefore pre-revenue, but the other four companies are already drawing clients. Resson has signed a $1.48 million first contract. Qimple raked in $200,000 last year and is on track for $400,000 in revenue next year; its target for 2015 is $1.2 million. Hotspot has 3,000 users and has programs operating in Fredericton and Saint John. It will soon add Halifax. It’s expecting sales of $600,000 this year. Adeptio has doubled its customer base just in the 12 weeks it was in the Launch36 program and is forecasting $400,000 in revenues in 2015.

With this graduation in the books, Launch36 now has 29 alumni companies. That means that with one more seven-member cohort, executive director Trevor MacAusland will have achieved the goal he established two and a half years ago — to launch 36 companies in 36 months.

These graduates should be ready to attract investment and take their products to market. BDC Ventures has an agreement with Launch36 (and other accelerators) to assess their graduating companies, and grant a $150,000 convertible note to those it deems “investment ready.” Three of the six companies in the last cohort received these notes. The assessment of the fourth cohort will be completed in the next few weeks.

Launch36 is operated by PropelICT, a startup support group that started in New Brunswick 10 years ago and is determined to spread its work across the region. It has graduated companies from the three Maritime provinces and is working to bring in its first Newfoundland and Labrador startup. And the fact its latest graduation ceremony was held in Halifax shows its regional ambitions.

The reason this is important is New Brunswick is ground zero for mentorship in the region, and mentorship is absolutely essential in developing great companies. While more companies have formed in Nova Scotia in the past two years than in the other provinces, New Brunswick has a stronger record for whipping companies into shape.

When we surveyed Atlantic Canadian startups this year, 76 Nova Scotian companies shared their revenue data with us, while the number was 41 in New Brunswick. Those 76 Nova Scotia companies recorded sales of $35.8 million in 2013, whereas the figure for those 41 New Brunswick companies was $33.2 million.

We’ve dug down into the data and can find no single reason that New Brunswick is generating more revenue on a per-company basis than Nova Scotia. But a huge factor is that the province has a stronger, more established and co-ordinated network of mentors. It recently launched The Mentra Co-operative, which will co-ordinate and promote mentorship in the region.

Monday night’s celebration — and the Atlantic Venture Forum, which begins today — are showing the products of that wave of mentorship. It’s already spreading through the region and will continue to do so.

Bungalo Sets Up Office in Halifax


An Icelandic startup that markets cottages to international tourists is setting up shop in Halifax as the launchpad for its Canadian expansion.

Bungalo began in the wake of the 2008 financial crisis to help Icelanders in financial straits earn some income by renting out their cottages to tourists from around the world. The enterprise was so successful that it has expanded into Sweden and is now moving into the Canadian market.

“We want to start off in Nova Scotia,” said Founder and CEO Haukur Gudjonsson in an interview Friday. “We think it is the perfect market to establish our proof of concept.”

Bungalo now has 500 Icelandic cottages listed on its site, and has about 16,000 registered users. It also markets cottages in Sweden and has begun a Canadian section on its site, which features a handful of cottages in Nova Scotia. Gudjonsson intends the number of Nova Scotian cottages to grow in the coming months.

He first arrived in Halifax last October, as one of the international mentors at MentorCamp, the one-day instruction session for startups. At that time he had been planning an international expansion, possibly in the Nordic countries, but he grew excited about Halifax and the Canadian market.

Gudjonsson said the size of the Canadian cottage market is impressive and no website has come close to dominating it. He believes Bungalo has a great opportunity to gain market share because of its complete range of services – displaying the property, detailed descriptions, online booking, an international client base and a relationship with tripdadvisor.com.

The company has already hired a sales representative in Halifax and is working out of Volta Labs, while Gudjonsson himself is dividing his time between Halifax and Reykjavík.

He said the company intends to spend the rest of 2014 establishing its proof of concept in the Nova Scotian market and lining up listings for the next season. He then plans to expand across the country, building up presence in one province or region at the time.

Having been in and out of Halifax for several months, Gudjonsson has grown intrigued by the startup community that has many complementary qualities with that of Iceland. Both have young companies growing quickly among a small population base (Iceland has 320,000 people).

He is impressed with the enthusiasm of the Atlantic Canadian community, and the willingness of entrepreneurs here to help one another. Atlantic Canadian governments offer much more support to their startups than Iceland does, which Gudjonsson said is a good and bad thing. Though it supports companies through their lean years, he said, it reduces the incentive to focus on sales. In fact, he believes there is too much emphasis on fundraising over all in Atlantic Canada, even from private sources, when companies should be focusing on generating revenue.

“You have some very talented people here but I think you’re lacking a bit on the sales side,” he said.

As he develops his business here, Gudjonsson hopes to build links between the two startup communities, hopefully getting startups from each community to take part in each other’s events and combining resources.

 

33 Startups to Pitch in 6 Days


In the next six days, at least 33 startups are going to present their business cases before crowds in the Halifax area, and what’s impressive isn’t just the number but the quality of the companies.

On Monday night, the Launch36 accelerator will hold the demoday for its fourth cohort at Pier 21, featuring six presenting companies. And on Tuesday and Wednesday, the Atlantic Venture Forum will take place at the Westin Nova Scotian, at which 24 companies will pitch for international investors and others. And today starting at noon, there will be a pitching session at Volta Labs on Spring Garden Road. (A few are pitching twice)

The activities of the next week comprise an opportunity to take stock of where the startup community in the region is today.  It’s easy to be impressed by the volume of companies with 33 presentations, but the quality of the companies is really strong. That will be borne out by the presentations and their demonstrations of traction. It’s also impressive that the audience in most cases will include a range of investors from around the continent.

Here are the companies that are presenting:  

Fourth cohort of Launch36:

Adeptio, Charlottetown

HotSpot Parking, Fredericton

Hyton Innovation, Fredericton

KinterGuardian, Moncton

Qimple, Moncton

Resson Aerospace, Fredericton

Presenting companies at the Atlantic Venture Forum

Growth Stages Companies

Atlantic Hydrogen, Fredericton

Chelation Partners, Halifax

Chemgreen Innovation, Sackville, NB

Eigen Innovations, Fredericton

Halifax Biomedical, Mabou, NS

InNetwork, Halifax

Livelenz, Halifax

Marcato Festival, Sydney, NS

Neurodyn, Charlottetown

RtTech Software, Moncton

Sagecrowd, Halifax

Zed Creative Inc. Spot

Early stage

Adeptio, Charlottetown

Cellufuel, Halifax

DashHudson, Halifax

DeCell Technologies, Halifax

DeNovaMed, Halifax

FoodTender, Shediac, NB

Heimdall Networks, Sydney, NS

Hyton Innovation, Fredericton

Island Water, Stratford, PEI

KinderGuardian, Moncton

Proposify, Halifax

Spring Loaded Technology, Halifax

Presenting companies at the pitching session at Volta (all from Halifax):

Fundmetric

Modest Tree Media

Email Opened

Swapskis

Athletigen

Databoliks

 

Pond, UNB, Kilfoil Win National Awards


Atlantic Canadians captured three Startup Canada Awards at a gala affair at the CN Tower in Toronto last night, shining the spotlight on mentorship and education in the region.

Gerry Pond, the chairman of East Valley Ventures, captured the headlining Wolf Blass Lifetime Achievement Award for his years of contribution to startups and innovation in the country. 

Mary Kilfoil, who heads the Starting Lean Initiative at Dalhousie University with her husband Ed Leach, took home the Entrepreneurship Educator of the Year award. And the University of New Brunswick was named Most Entrepreneurial Post-Secondary Institution of the Year.

There’s certainly an educational theme the selections in Atlantic Canada. Though many think of Pond as an investor first and foremost, I think he has two roles that are of greater value. First, he’s tremendous at building the ecosystem, a pursuit in which he’s tireless. And second, he’s a great mentor, and his lessons on sales and getting to market are timeless.

In a similar vein, the other winners are devoted to imparting knowledge, wisdom and lean methodology on a new generation of entrepreneurs.

As well as being the home of the Pond-Deshpande Centre, UNB has a long history of blending engineering and/or scientific research to produce great companies. One interesting feature is that the Dr. J. Herbert Smith Centre for Technology Management & Entrepreneurship, headed by Dhirendra Shukla, is part of the engineering school, highlighting the link between development and commercialization at the university.

Kilfoil and Leach have been teaching their Steve Blank-inspired entrepreneurship course for almost two years, giving birth to several startups along the way. They are also the driving force behind Canada’s Business Model Competition. 

I’d like to congratulate Rick Spence of the National Post for winning the Media Person of the Year category. The runner up for this award was Rob Lewis of Techvibes, while I received an honorable mention.

Runners-up from Atlantic Canada were Rob Cowan of McInnes Cooper in Professional Services Organization of the Year, and Startup Fredericton in Startup Community of the Year.

The other people who received honourable mention were Bob Pelley in Community Builder of the Year, Dan Martell of Clarity in Entrepreneurial Effect Award and Robert Zed in Mentor of the Year.

BioNova Recognizes Acadian Seaplants


Acadian Seaplants Ltd. has received recognition from BioNova as the Good News Story of the Year.

The Dartmouth company, a global leader in the processing of seaweed-based products, received the award last night at BioNova’s annual Good News and Blues bash in Halifax. The party celebrates one good news story from the past year and features three bands made up of people from the life sciences community – one from Innovacorp, one from Dalhousie medical research, one from ACOA. Somehow, it works.

Acadia Seaplants, which exports products to more than 80 countries, won the nod for its recent acquisition of Arramara Teoranta, Ireland’s largest seaweed company, and the completion of its enhanced production facility in Cornwallis.

BioNova said that Acadian Seaplants announced in 2009 – when most companies were downsizing -- it would expand its Cornwallis plant to improve quality, boost productivity and increase exports. The grand opening of the Deveau Centre, which has improved production capacity by as much as 80 percent, takes place next week. 

“We're honoured to be receiving the good news story award,” President Jean-Paul Deveau said in a release.  “Everyone has been working hard these last few years and yes, we’ve taken risks, but with a global vision, excellent technologies, excellent products and a great team, those risks are paying off.”

Re-inventing the Retirement Home


For Tyler Sellars, visiting a relative in her retirement home was a distressing experience. The relative was unhappy and felt uncared for. Now, her sadness has led the 20-year-old New Brunswick entrepreneur to a new business idea that aims to optimize care for the elderly.

In the mid-2000s, Sellars’ relative had suffered a stroke and was living in the facility where she spent her final years.

“They didn’t give her sufficient stimulation to counter the effects of the stroke; that made her health deteriorate,” said Sellars by phone from his Moncton home. “And although a few of the nurses clearly loved their jobs, others were not as committed.”

The experience left Sellars with an understanding of the needs of the elderly and now he is CEO of a new venture that plans to build three retirement communities together in Atlantic Canada. The plan is to build the three communities in a city centre and offer a high level of care.

“Stage 1 will be a retirement community for people who just need help with things like lawn care. Stage 2 will be a continuing care retirement community, offering minimal medical care. Stage 3 will offer hospice care,” he said.

“The homes will be built together on one large piece of land. Because they’ll be together, people won’t have to move. If someone gets sick, they might move to another building but they’ll still be near their family and friends.”

He said that age-segregated housing is a $51-billion industry and that Moncton has been chosen as a potential location for his venture because it is fast-growing but still affordable, and a great place to run a business.

This might seem an unlikely project for a man his age to be involved in, but Sellars has the support of experienced Halifax-based entrepreneurs. Despite his youth, this is not the first entrepreneurial venture for Sellars, who learned the value of self-reliance back in 2008 when, as a 15-year-old, his parents told him they could no longer afford to pay his soccer fees.

A gifted soccer player, Sellars was on New Brunswick’s provincial team and the travel and expenses cost up to $10,000 a year. His parents, Jim and Barb, worked in the financial sector and were hard hit by the economic collapse.

The young Tyler could not bear to lose his soccer, so he started raising money himself, beginning by asking the public for cash at Moncton stores.

“It was mid-December and freezing. I hated it; you have to use puppy dog eyes on everyone,” he said.

He began to look for other ideas and, without his father’s knowledge, made $8,000 on eBay by selling soccer jerseys and other items in his father’s name. Then he created his own e-commerce website, selling clothes made in South Korea.

“I realized this effort is called ‘entrepreneurship.’ I met with a bunch of local entrepreneurs and fell in love.”

He later set up a venture called Redknot that links volunteers who want to work in developing countries with non-profits.

He has just sold Redknot to a partner.

He has also recently completed Year 1 of a commerce degree at Saint Mary’s University, but plans to commit himself to the retirement project rather than finish school. He said he has been a good student, but intends to pursue this opportunity.

“I’ve always wanted to be an entrepreneur but, with my other ventures, I haven’t fully committed myself. I wanted to be safe. But this is taking off. I don’t want to miss the chance.”

He said he wants to share his story because he knows there are many successful young entrepreneurs, but he rarely heard about them when he needed encouragement.

“I always wanted a helping hand, not physically, but emotionally. I wanted a story to back myself up with.”

Press Release: Foursum’s New Feature


Want to Play Against the Pros? Foursum Golf Introduces In-App Profiles for the PGA’s Top Players

All-in-one mobile golf app will now let you compare your stats to the pros, including Tiger Woods, Phil Mickelson and more.

Thursday, June 12th, 2014 9:00am EST

New Brunswick, Canada: Foursum, the all-in-one mobile app for golfers that allows golfers to manage their game while connecting with friends, announced today that they are rolling out their newest feature: reserved profiles for the top 50 players on the PGA Tour. This exciting addition to the app will compliment existing features such as in-app GPS, scorecards, and the option to set up games and compare stats with friends.

With the introduction of the reserved profiles, users will now be able to follow the scorecards of their favorite PGA players within the app, including crowd favorites such as Tiger Woods, Phil Mickelson, Adam Scott, Rickie Fowler, and Bubba Watson.

Unique to Foursum, users will have access to their favorite PGA player’s scorecards from their smartphone, allowing them to follow their score, putts, fairway accuracy, driving distance and more. Users will also be able to browse each PGA player’s stats from their most recent round to their stats over the last season, scorecards will be updated once players have completed their rounds.

“By integrating PGA Pro Profiles into Foursum, we’re bringing golfers together - of all skill and experience levels. We’ve created a way for golfers to interact with the game - using our app to discuss their rounds, and the rounds of their favorite pros,” explains Foursum CEO and Co-Founder Matt Eldridge. “And when Rickie Fowler is ready to use Foursum - his profile will be there waiting for him to claim.”

Starting today, Foursum users will be able to compare their scores with those of their golf heroes. Whether you want to see if you can drive it long like Bubba Watson or hit as many greens as Tiger, Foursum makes it easy to connect with friends to share how you rank against the PGA’s best.

Recently, Foursum announced a strategic partnership with COBRA PUMA GOLF. They have also been selected as the official statistics partner for the Maple Leaf Junior Tour. To learn more about Foursum and discover the new PGA branded profiles visit http://foursum.com/

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Quick Facts:

The Company: Foursum

Website: http://Foursum.com

Blog: http://blog.foursum.com/

Facebook: https://www.facebook.com/foursumgolf

Twitter: @Foursum

President / Co-Founder: Matt Eldridge

Technical Lead / Co-Founder: Adam MacDonald (@amacdonald) PGA of Canada / Co-Founder:

Louis Melanson (@louismelanson)

Headspace Sold, Spins off Proposify


In a deal that impacts at least five Nova Scotian tech companies, New Glasgow businessmen Jim Fitt has bought Halifax web design company Headspace Design, allowing its two co-founders to focus on their new startup Proposify.

Fitt, the founder of training materials provider Velsoft, paid an undisclosed amount for Headspace. He promises the highly regarded web development company will continue to meet clients’ needs and to grow in the future.

Headspace co-founders Kyle Racki and Kevin Springer, while assisting with the transition, will move on to work on Proposify (formerly PitchPerfect), which helps service providers produce professional-looking written proposals.

Proposify is already making strides, having secured about 20 international paying customers and closed its first round of financing, Racki said in an interview. The $670,000 round includes a $250,000 equity investment from Innovacorp, an investment from angel investor Patrick Hankinson and a contribution from the Atlantic Canada Opportunities Agency.

The company recently completed two programs in Boston, the Canadian Technology Accelerator organized by the Canadian consulate and 48 Hours in the Hub organized by Canadian Entrepreneurs in New England.

 “It kind of helped us get out of this little bubble of Atlantic Canada and get into a big city with a thriving tech scene,” said Racki. “We got to meet a number of experienced mentors that we’re going to stay in touch with.”

Velsoft will gain access to creative tech talent, and Fitt will develop Extrify, an online collaboration tool that had been incubated within Headspace. Extrify lets companies create messages, files and threads of comment and share documents across the whole company or within specific departments.

It recently placed first in the northern Nova Scotia zone in Innovacorp’s I-3 competition.

In an interview, Fitt said the deal allows New Glasgow-based Velsoft and its sister company znanja, access to the talent within Headspace.

 “A problem that I have in rural Nova Scotia is attracting talent,” said Fitt. “Velsoft has clients in 164 countries and we’ve worked hard to grow it into a global name. But our No. 1 problem is finding talent and it was stunting our growth. We wanted a way to look for talent.”

He learned Racki and Springer were trying to free themselves from the service business so they could concentrate on Proposify, which they have been working on for almost three years.

As he delved into Headspace, Fitt learned it had incubated a few different products that could be developed into independent companies.

He instantly latched on to Extrify, a collaboration software that gelled beautifully with a project of his own, which he calls “predictive collaboration.”

This technology assesses a user’s behaviour in the collaborative process to predict his or her next action and make collaboration more effective and timely.

Fitt wrapped the two technologies together, adopting the Extrify name, and now has clients using the unified product. He plans to hand off management of Velsoft to other staff so he can focus on Extrify.

The Headspace assets also include a social media monitoring product called Social Gopher, which Fitt is setting aside for now. Meanwhile, Fitt continues to grow znanja, a two-year-old software company that converts normal digital documents into e-learning material in seconds. It will also now have access to the Headspace talent.

Springer and Racki have been trying for a couple of years to focus exclusively on Proposify.

Report Probes NL Entrepreneurship


A new report on entrepreneurship in Newfoundland and Labrador reveals the province has a healthy entrepreneurial environment, especially among older entrepreneurs and immigrants.

The findings were released Wednesday in the 2013 Global Entrepreneurship Monitor (GEM) Newfoundland and Labrador Report, part of an annual study of entrepreneurship throughout the world. The provincial report was authored by Gary Gorman, Dennis Hanlon and Blair Winsor at the Memorial University’s Faculty of Business Administration.

“This is a good news report as it tells us that, in spite of Newfoundland and Labrador’s history of being a “have not” province, the state of entrepreneurship in this province is strong,” said Hanlon, associate professor of entrepreneurship.  “In particular, early-stage entrepreneurial activity is being driven by opportunity rather than necessity, which is likely a reflection of the strong provincial economy.”

The GEM report says Newfoundland and Labrador has the highest rate of immigrant early-stage entrepreneurship in Canada at 19 percent. Quebec has the second-highest rate at 14.8 percent.

It also said the province has the highest rate of early-stage entrepreneurial participation in the 55-64 age group at 27.3 percent compared to the national average of 9 percent.

The report said Newfoundland and Labrador’s entrepreneurship community differs from the rest of the country in several ways. Entrepreneurs are accorded high social status than in the rest of Canada, said the report, and total early-stage entrepreneurial activity is slightly lower than the national average.

The report, the first of its kind for NL, also identifies some areas that can be further improved to strengthen entrepreneurial activity such as access to private funding, education and training, and greater support for high-growth firms.

“The real excitement and action [in NL entrepreneurship] is on the startup end -- that area where founders are taking their innovative ideas and turning them into high-growth enterprises,” Roger Power, Co-Founder of Startup Newfoundland & Labrador. “We see businesses form rapidly, develop their products and services quickly and most importantly, attract customers.  These startups are developing apps, software, ocean tech and other innovative technologies that are entering markets around the world.”

The key findings of the report include:

•81.2 percent of the province’s labour force feels entrepreneurs are accorded high social status (Canadian result: 70.1 percent).

•75.9 percent indicate the media is doing a good job of supporting entrepreneurship (Canadian result: 69.9 percent).

•65.6 percent believe there are good opportunities to start a business in Newfoundland and Labrador. However, only 53 percent believe they possess the skills and knowledge to do so.

•Slightly more than 28 percent of the province’s adults (ages 18-64) are actively engaged in activities related to starting or running independent businesses.

•The rate of early stage entrepreneurship (i.e. those who are contemplating setting up a business or have started one in the last 3.5 years) in Newfoundland and Labrador is 10.8 percent, slightly lower than the national average of 12.1 percent.

•The business services sector has the highest rate of entrepreneurship participation in the province (37.9 percent) and in the country (40.5 percent).

•The rate of necessity-driven early-stage entrepreneurship is the lowest in the country, at 0.7 percent in Newfoundland and Labrador versus 1.8 percent in Canada.

•The province has one of the lowest rates of people planning to start a business in the country at 13.3 percent (Canadian result: 17 percent).

•Newfoundland and Labrador has one of the lowest participation rates in angel investing in the country: two percent compared to the national average of 3.9 percent.

•Nearly one in five early-stage entrepreneurs in the province is growth-oriented, which is comparable to the overall average for Canada. However, Newfoundland and Labrador doesn’t fare as well in either innovation or internationalization, areas which are necessary to compete at an international level.

•Entrepreneurs exhibit higher scores for well-being than the general population. Among entrepreneurs, females express greater well-being than their male counterparts, and owners of existing businesses report greater well-being than employees in the province.

Demographics (from APS)

•In the 55-64 age group, Newfoundland and Labrador has the highest rate of early-stage entrepreneurial participation at 27.3 percent compared to the national average of nine percent.

•The provincial ratio of 0.73:1 female to male early-stage entrepreneurs is stronger than the overall Canadian ratio of 0.68:1.

•Newfoundland and Labrador has the highest rate of immigrant early-stage entrepreneurship in Canada at 19 percent. Quebec has the second-highest rate at 14.8 percent.

Entrepreneurial ecosystem (from PES)

•The experts surveyed think that entrepreneurial opportunities in Newfoundland and Labrador are increasing; however, know-how to start and manage small businesses and high-growth firms is considered low.

•With the exception of government assistance, the experts believe that access to funding in the province for entrepreneurial activity is problematic. Entrepreneurs among the experts surveyed are more negative about access to capital, particularly from private sources.

•In the opinion of experts, there are shortcomings with education and training, especially at the secondary and primary educations levels where respondents indicate low levels of teaching directed to knowledge of market economic principles, and entrepreneurship and new firm creation. 

•According to the experts, support for women entrepreneurs is generally positive.

•The experts also thought that support for and attitudes toward innovation were positive.

•Physical infrastructure in Newfoundland and Labrador is considered to be good, but still ranks lower than the other provinces participating in the study.

•Experts in Newfoundland and Labrador think that Canadian culture is less supportive of entrepreneurship compared to experts in other provinces.

•Specific recommendations by the experts focus on financial support (venture capital), education and training (mentoring and experiential programs) and government policies (enhance those directed at small businesses).

BioVectra Begins $3.8M Expansion


BioVectra, the Charlottetown drug manufacturer purchased last year by Questcor Pharmaceuticals of Anaheim, Calif., for $100 million, has begun the latest expansion of its facility near the city’s airport.

The drugmaker is demonstrating the economic benefits of an exit by adding 13,000 square feet of space to its factory at a cost of $3.8 million. The company needs the extra space because it is increasing its work force from 140 people in 2012 to 250 people by the end of this year.  

BioVectra received a $3 million loan last year through theAtlantic Canada Opportunities Agency's  Atlantic Innovation Fund, which it said would help to finance anexpansion of the business.

The company said in a statement the expansion will primarily comprise laboratory, offices, workstations, and amenity space.

Current office and lab areas at the facility are also being renovated to accommodate new equipment and meeting configuration requirements, said the statement. It expects to complete the construction by November.

‘We are pleased that our business growth has created new jobs at BioVectra, and we are investing in establishing proper workspace for our employees, and support services for our clients,” said CEO Ron Keefe in the statement. ‘We are continuing to grow the business with existing and new customers, requiring new skilled employees in key areas such as manufacturing, quality control, quality assurance, engineering, and maintenance functions.”

A Strategy to Get Early Adopters


When Gregg Curwin met potential clients in New England last month, he tried using an early adopter pitch he’d just learned from Gerry Pond at the Entrevestor Dinner in Fredericton.

Curwin is the Founder and CEO of Truleaf Smart Plant Systems, a Halifax venture that grows plants in stacked trays under LED lights. He attended the dinner in Fredericton and was especially impressed by the strategy for signing up early adopters outlined by Pond, the chairman of East Valley Ventures.

“I was in the States, and used the early adopter pitch with the Truleaf pitch,” said Curwin. “They loved it and it worked very well. They want me back to meet senior execs.”

Pond’s solution was a quite simple strategy for young companies to get that all-important first client. Atlantic Canadian business-to-business startups find it an especially difficult task because of there are few large companies in the region. Governments can fill the void in theory, but they tend to make decisions and adopt new processes slowly.

To help ameliorate this key pain for the community, Entrevestor invited Pond to outline the problem at our dinner, propose some solutions and generate some discussion among the 50 or so guests. (We also debated mentorship, which I will discuss in a coming column.)

Pond suggested that one way for startups to gain early adopters is to propose a pilot project. The startup can propose to work – possibly without pay – with the potential customer so that the two parties test the new innovation. For the customer, it’s an opportunity to bring on new technology without a large financial outlay, and the possibility of a productivity gain. For the startup, it’s a chance to gain feedback and to work out kinks. And of course, the goal is to remove the word “potential” from potential customer. The idea is to convert the customer into a paying client, possibly even an investor.

Pond recounted the story of one of the East Valley Ventures companies, SHIFT Energy, which has developed an automated solution to help large facilities save energy. It had no national clients but sent out messages to companies around the continent offering this sort of arrangement.

SHIFT got some responses, including interest from the Vancouver Canucks, which owns the Rogers Centre in the Western city. It turns out a hockey rink is a surprisingly complex consumer of energy, and SHIFT was able to work with the group and is looking forward to converting them into paying customers. Pond suggested that this is a strategy that should be adopted more frequently in the region.

“It’s about building relationships with strangers,” said Pond. “We didn’t know anyone from the Vancouver Canucks when we started the process.”

We want to solicit more opinions from the broader community on this subject. Should accelerators do more to develop early adopter strategies? Do we need formalized early adopter strategy? Should we formally recognize early adopters from the region? Please join in the discussion by leaving comments below.

Developing a better infrastructure for finding early adopters will mean more companies will get to revenue more quickly.

Press Release: Banyan-Pennecon Deal


Banyan Capital Partners, a private equity firm based in Toronto and Vancouver, announced it has teamed up with management to buy the concrete division of Pennecon Ltd., a Newfoundland and Labrador construction and engineering company.

The parties did not reveal the financial details. Though this deal doesn’t fit squarely with our mission of reporting on Atlantic Canadian startups, it is another sign of institutional private capital flowing into private companies in the region.

The following is the Banyan press release:

 Management buys out the concrete division of Pennecon

TORONTO, June 3, 2014 /CNW/ – Pennecon Limited (Pennecon), one of Newfoundland’s leading heavy civil construction, energy and real estate businesses, announced today that Larry Puddister, Chief Executive Officer of Pennecon, has led the management buyout of the concrete division of Pennecon. Banyan Capital Partners (Banyan), a Canadian private equity group, provided funding for the deal. Going forward, the concrete division will be renamed Newcrete Investments Limited Partnership (“Newcrete”).

With over 40 years of history, Newcrete is a leading producer and supplier of ready-mix concrete, precast concrete, and masonry products for the construction industry in Newfoundland and Labrador (“Newfoundland”).

Jeff Wigle, Managing Director of Banyan Capital Partners, said “We perceive a significant opportunity for Newcrete to build on its strong position in the concrete and aggregate market in Newfoundland. We look forward to working with the Newcrete team to achieve their objectives.”

Larry Puddister, who is also CEO of Newcrete, said “This is an exciting time for our employees, customers and other stakeholders. Banyan’s support for Newcrete will preserve our unique corporate culture while enabling us to continue growing as a provider of concrete, aggregates and masonry products to the Newfoundland marketplace. I am happy to confirm that it will be business as usual.”

Adam Jezewski, Director of Banyan Capital Partners, said “Newcrete is a great example of the kind of business we look for as investors, with an established reputation in the marketplace, a cohesive, sharp management team and strong client relationships.”

About Newcrete Investments Limited Partnership

Newcrete is a leading producer of construction aggregate and supplier of ready-mix concrete, precast concrete and masonry products to the construction industry in Newfoundland and Labrador. With over 150 employees, Newcrete owns the largest fleet of concrete boom pump trucks, operates the only fully automated block production facility and are the only producer of Concrete Paving Stones and Keystone retaining wall systems in Newfoundland and Labrador.

About Banyan Capital Partners

Banyan Capital Partners is a Canadian based private equity firm that buys and invests in private and public middle-market companies located in North America. As a generalist firm, Banyan provides full or partial liquidity to existing owners or partners with owners wishing to grow their companies and become more successful. Banyan is part of the Connor, Clark & Lunn Financial Group, a multi-boutique asset management firm whose affiliated companies collectively manage over $51 billion in assets. http://www.banyancapitalpartners.com

SOURCE Banyan Capital Partners

NewPace Tech Bought by NewNet


Bedford-based NewPace Technology Development Inc. has been bought by NewNet Communications Technologies of Arlington Heights, Ill., greatly expanding the sales power of the mobile technology developer.

NewPace, which is headed by founder and CEO Brent Newsome, will become a subsidiary of the NewNet messaging division, based in Amsterdam. The company will change its name to NewNet Canada, and Newsome will become a vice-president of NewNet Communications and general manager of the Canadian operation. NewNet, which is a portfolio company of Los Angeles private equity firm Skyview Capital, did not reveal financial details.

Krishna Viswanadham, president of NewNet’s mobile messaging business unit, said the company bought NewPace because the Bedford company created technology facing strong demand around the world.

“Mobile operators are trying to develop content-rich messaging applications and NewPace has developed technology that we can offer to the mobile operators’ customer base,” said Viswanadham. “NewPace is probably the top one, two or three players in the world in this technology space.”

The deal is the third exit this year for Atlantic Canadian tech companies. Fredericton-based UserEvents was taken over by LiveOps Inc. of Redwood City, Calif., in January, and Compilr of Halifax was bought by lynda.com  of Carpinteria, Calif., in April. With no financial details, none generated massive media interest.  But already in 2014 there have been three exits by Atlantic Canadian startups whereas last year there were only two – BioVectra of Charlottetown and RIVALUS of Halifax.

NewPace has spent the past few years developing a suite of rich communications service, or RCS, mobile phone products. These products increase the flexibility that companies can offer in texting services on mobile handsets. It means texts can be used for chat, group chat, file transfer, video and voice calling across networks and using any smartphone. The goal is to upgrade the current standards of voice and text messaging offered by mobile carriers.

The company, whose revenue was well into seven figures in 2013, has been focusing on sales for the past year, but its 28-person staff simply didn’t have the firepower to sell to mobile operators around the world. NewNet has that sales force. It now supplies products to 80 operators around the world, including the top one or two operators in each major market, said Arjan Lasschuit, senior director, product management, for the messaging unit.

“We simply can’t reach the world the way NewNet can,” said Newsome.

He said the company will maintain its current workforce in Halifax, honour existing contracts and likely grow it in time, given the sales potential that comes with the new ownership. In the past, NewPace offered consulting services in a range of mobile businesses, and that side business will in the future focus more precisely on RCS-based work.

NewPace has been in existence for five years, and in that time, paid a total payroll of $10.2 million, almost all of it within Nova Scotia. The company was owned by Newsome and CTO Gavin Murphy. Without giving specifics, Newsome said that they’ve done well from the deal. Yet he made it clear that the deal with NewNet was very much their second option.

“We would have preferred to stay independent,” he said.

He had been trying to raise equity capital, but could not secure the $5 million or so that would have been needed to build the bona fide sales force that NewPace required.

Newsome said all the components exist in the Atlantic Canadian ecosystem to develop tech companies whose products can sell globally, but the acute shortage of growth capital is preventing them from growing.

“It’s a missing piece in our ecosystem,” Newsome said.

CoinCity Celebrates Bitcoin in Moncton


When the organizers of the CoinCity conference on Friday took up a collection for the families of slain RCMP officers, the attendees could contribute in one of two ways – conventional money or Bitcoin.

It was fitting that the organizers of the Moncton event paid tribute to the fallen Mounties hours after their suspected murderer had been captured. It was also fitting that they used the collection to show the flexibility of Bitcoin.

Commonly known as digital currency, Bitcoin is a peer-to-peer payment system introduced as open-source software in 2009. It is a decentralized currency controlled by no central bank and can be transferred electronically between parties anywhere in the world. And there are a group of entrepreneurs dedicated to making Moncton a Bitcon hub.

Entrepreneur Raphael Paulin-Daigle organized CoinCity to explain the potential of the new technology and currency, and possibly to lay the foundation for new businesses based on the Bitcoin protocol.

“We’re hoping some entrepreneurs with passion for Bitcoin will learn more about it and take the lead,” said Paulin-Daigle as the session wound up. “There’s still tons of stuff you can do with Bitcoin.”

He has established his own consultancy called DucatFlow, which will advise companies on all aspects of adopting bitcoin. He is assembling a team of programmers to take care of the technical aspects, and has struck partnerships with a lawyer in New York and accountant in Ottawa for professional services.

Held in the new offices of Venn Innovation (formerly Tech Southeast), the conference featured explanatory talks by  Haseeb Awan, CEO and co-founder of BitAccess, an Ottawa startup that makes Bitcoin ATMs, and Michael Curry, co-founder of Vault of Satoshi, a Brantford, Ont.-based exchange that allows trading of traditional and digital currencies.

And on display was Moncton’s first Bitcoin ATM, which will be installed today in the Main Street location of Freshii, the Moncton-based health-food deli. Freshii is the first Moncton retail company to accept Bitcoin, and it has the first two-way ATM (it can accept deposits and dispense Bitcoin) in the region.

About 100 people attended the conference – a great number considering much of the city was in lockdown 15 hours earlier. And the crowd ranged from local entrepreneurs to reps from the local startup-focused PR agency Onboardly to members of the new Crypto-Currency Club of Dalhousie University.

Clarity Founder and CEO Dan Martell, one of the region’s greatest proponents of Bitcoin, said his own bullishness on Bitcoin is based on three factors: first, everyone understands money so it’s not like you have explain a concept no one gets; second, anyone can participate; and third, there are clear opportunities for innovation.

“This city has the potential to adopt the technology to adopt the technology and move it forward,” said Martell.

Venn Innovation President and CEO Doug Robertson agreed.

“If there’s a decent chance that this is going to fly, then we’ve got the right people, the right mindset,” he said. “It’s a golden opportunity for us to seize.”

Press Release: Pond-Deshpande


The Pond-Deshpande Centre at the University of New Brunswick issued the following press release:

Eastern Canada’s First Social Enterprise Accelerator Launches Six New Businesses

(June 6, 2014, Halifax, NS) Eastern Canada’s first Social Enterprise Accelerator program gathered a cohort of individuals and organizations from New Brunswick and Nova Scotia in the early stages of launching a new social enterprise and provided them with mentorship, expertise and investor exposure as part of a six-month program that started in January 2014.  Participants in the new B4Change Social Enterprise Accelerator celebrated their graduation at a Demo Day in Fredericton, New Brunswick, earlier this week.

B4Change participants participated in training sessions offered by leaders such as Lisa Hrabluk who is a writer, entrepreneur and founder of Wicked Ideas. Mentor matches were created with seasoned business professionals including Marcel LeBrun, senior vice president for Salesforce Radian 6.

The Pond-Deshpande Centre in New Brunswick bridges the gap between challenges facing social entrepreneurs — lack of funding resources, lack of connections, lack of support network — and the creation of sustainable, scalable social enterprise. “We are very pleased to welcome Nova Scotia-based CEED (Centre for Entrepreneurship Education and Development) on board as our collaborative sponsor for social enterprises,” says Karina LeBlanc, Executive Director at the Pond-Deshpande Centre.

“The B4Change program is a great example of like-minded organizations working across geographic boundaries to support entrepreneurs who are passionate about building profitable businesses that will ultimately change the world. We like to call it “the business of good,” says Heather Spidell, President and CEO at CEED.

CEED, with support from the Province of Nova Scotia’s Department of Economic and Rural Development and Tourism sponsored two social enterprises from Halifax, Nova Scotia to participate in the B4Change cohort.

Fadi Al Qassar, Uganda Ventures
Uganda Ventures is an Atlantic Canadian social enterprise working in rural Uganda to bring individuals, families and communities out of poverty. They build safe schools, support orphans in Uganda and provide entrepreneurs with business ideas with access to capital through a micro-credit loan. For more information: www.ugandaventure.com

Kristy O’Leary, Scout & Burrow
Scout & Burrow is a full service advertising agency with the unique mission to Market What Matters. They help their clients communicate and create profitable social impact. Scout & Burrow recently become a certified Benefit Corporation. For more information: www.scoutandburrow.ca

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Seeding Growth in the Third World


Philippe Levesque wants his farm-in-a-box to help feed the world’s hungry, but the New Brunswick-based botanist and horticulturist must first raise $10,000 so that he can produce 200 boxes to validate his idea in Canada.

For the last year, Levesque, 34, has been working alone on producing a self-contained gardening model to share with the world. His solution: wooden boxes containing seeds, tools and instructions that will be honed to suit each region and community.

 “I’ve met many farmers around the world and, in developing countries, I always thought, I’m so privileged; these people need the information I have. I could do so much to help,” said Levesque, who has worked in London’s Kew Gardens and in Australia where he conducted experiments in tropical farming on an ethnobotanical farm (one that studies the relationships between people and plants).

Levesque returned to Canada two years ago and is running an import-export nursery from Balmoral and trying to get his new business, the Agrarian Revolution, off the ground. It’s been difficult for him to devise a working model for the new venture because, although he has experience in running professional gardening-related businesses, this is a new kind of entrepreneurship for him.

But he is now energized after receiving a boost by participating in the B 4 Change accelerator program for social entrepreneurs at the Pond-Deshpande Centre at the University of New Brunswick. Levesque is among the first cohort of the six-month program which has been created to help social entrepreneurs — those who want to found a business that meets a social, economic or environmental need and turns a profit.

Levesque was awarded $6,000 by the Pond-Deshpande Centre but he gained more than money.

 “With the Pond-Deshpande Centre’s help the Agrarian Revolution is taking off,” he said. “I needed to make my model marketable and the program has given me impetus. And it’s linked me with other contacts, including a Uganda-focused group that I may partner with.”

Now, he must validate his concept by selling variations of his boxes in stores across Canada. He needs to raise $10,000 to produce 100 gardening-themed boxes and 100 patio-themed boxes. If Canadians buy these, he will reinvest the money into producing his farm-in-a-box versions. The Canadian boxes will help pay for the farming boxes and, in time, he intends to charge the communities in developing countries a small sum for the boxes they receive.

 “I believe that if we charge even a dollar or two, they will appreciate and utilize it,” he said.

He hopes that the first testing of the product in a developing country will take place later this year, probably in Uganda. He feels that using basic, sustainable farming methods is the best way to help poorer communities, citing the example of India, which he says has a high rate of suicide among farmers who are often in debt because of the steep cost of chemical fertilizers.

 “We will start by building community gardens and I hope acceptance will come. I want everything to be local,” he said.

He is looking forward to sharing the knowledge acquired through his work and education, which includes studying horticulture at the Royal Horticultural Society in the United Kingdom and at the University of Guelph.

 “We will target lack of water by letting farmers know which crops grow best in their conditions,” he said, his voice lively with anticipation.

 “And there are a few plants that I believe will become our flagship plants. Amaranth, for instance, a Mexican plant, is great. You can eat the leaf and seed and it is heat and drought tolerant and the leftovers can be cooked. It’s not widespread yet but has a great future.”

Press Release: The Rounds’ Partners


Physician Associations and The Rounds Partner Up To Improve Healthcare For All Canadians

The Rounds Announces Partnership With The Society of Rural Physicians of Canada and The Canadian Association of Emergency Physicians

NOVA SCOTIA, Canada., June 3 -- The Rounds, the largest online community in Canada exclusive to physicians, and The Society of Rural Physicians of Canada (SRPC), the national voice of Canadian rural physicians, announced the first association partnership to improve the quality and efficiency of SRPC membership communication.

According to the SRPC, 31.4% of Canada’s population or roughly 9 million people live in predominantly rural regions. Towns under 10,000 people account for 22.2% of the population, and yet they are served by only 10.1% of physicians. Canada's larger rural and regional centers (with populations from 10,000 to 100,000 people) constitute 15.9% of the population and have only 11.9% of the physician pool. With sub-specialists and high technology of large cities distant, arming these physicians with the tools they need to connect, collaborate and stay informed is critical. 

The partnership presents the first of many with Canadian physician associations. The Canadian Association of Emergency Physicians announced their partnership with The Rounds at their annual CAEP conference. The combined membership of these two entities will support an ongoing mission to help move healthcare forward across the country.

“The Rounds is an exciting and effective tool to put in the hands of our members” said Lee Teperman, Administration Officer of SRPC. “Our members face challenges particular to rural in their practices and are a group of early adopters who truly want to be a part of the advancement of healthcare in this country. The Rounds has put together an elegant platform that provides our members an opportunity to collaborate with physicians across the nation in a secure environment and offers us an opportunity to communicate more effectively with members.”

“Healthcare transformation starts with physicians” said Dr. Michael Clory, Co-Founder of The Rounds. “Our team is excited for our partnerships with SRPC and CAEP as we strive to enhance and improve the way our nations healthcare providers connect and collaborate with one another.

For more information, visit: http://www.therounds.com

About The Rounds

The Rounds is Canada’s largest and fastest growing online network exclusive to Canadian physicians. The Rounds is a secure network where Canadian physicians communicate using privacy compliant tools to discuss clinical cases, research journals and industry questions.

About The Society of Rural Physicians of Canada

The Society of Rural Physicians of Canada (SRPC) is the national voice of Canadian rural physicians. Founded in 1992, the SRPC’s mission is to provide leadership for rural physicians and to promote sustainable conditions and equitable health care for rural communities.

About The Canadian Association of Emergency Physicians

The Canadian Association of Emergency Physicians (CAEP) is a not for profit member organization that has been educating and advocating on behalf of emergency physicians and their patients for better healthcare since 1978. CAEP is the national voice of Emergency Medicine.

Lamda Guard Signs Deal with Airbus


In a textbook case of a startup landing the perfect early adopter, Halifax-based Lamda Guard announced Wednesday that it has signed a deal with Airbus to jointly develop its technology to protect planes from laser attacks.

The world’s largest aircraft maker will cooperate with the Nova Scotian startup on the development of a transparent, flexible film that can go over the aircraft windshields to block out laser beams. The shield is necessary because aircraft pilots are increasingly subject to people – from terrorists to pranksters – shining lasers at cockpit windows to blind the crew.

Lamda Guard is the brainchild of Founder and CEO George Palikaras, a PhD who has developed a metamaterial that uses nanotechnology to filter out, absorb or enhance certain forms of light. Palikaras and his team are working on various applications, but chose to focus first on a laser shield because the pain of laser attacks is so pronounced.

``It was solving something that was real,” said Palikaras in an interview.  “It was also something that was very close to my heart because in my home country laser attacks are a problem. At basketball games, players are lased. In the street, Police are lased.”

He added that the pain is growing as laser attacks on aircraft in the U.S., according to the Federal Bureau of Investigation, have risen from 300 in 2005 to almost 4,000 in 2013.

Palikaras is an expert in metamaterials, which are synthetic materials that have properties not found in nature. It is a rapidly growing academic discipline with huge commercial applications, and Palikaras said his goal is to make Atlantic Canada a global leader in metamaterial research and development.

Under the deal with Airbus, the European company will put up about $1 million in human and other resources to help Lamda Guard test and commercialize its technology in the first phase.  Then in phase two, it will help the company get certification and more testing at a cost of several million dollars. Palikaras said a confidentiality clause prevented him from discussing the financial details.

"At Airbus, we are always on the lookout for new ideas coming from innovative SMEs, such as Lamda Guard,” said Senior Vice President of Innovation Yann Barbaux in a statement. “We are very pleased to explore together the potential application of this solution to our aircraft, for the benefit of our customers."

Palikaras has formed a Nova Scotian holding company Metamaterials Technology Inc., which has three divisions overseeing different aspects of the company’s research. Lamda Guard deals with blocking light. Lamda Solar focuses on absorbing light. And Lamda Lux concentrates of solutions that enhance light.  

The company, whose chairman is Atlantic Composites founder Maurice Guitton, has struck research partnerships with University of Moncton and the University of New Brunswick. It has raised $600,000 from private investors and received loan commitments of $500,000 from the Atlantic Canada Opportunities Agency’s Business Development Program.

Palikaras said his company is now working on a fund-raising round with a goal of about $2.5 million. 

Cirrus9-Cloud-A Merger to Aid Growth


Cirrus9, a Saint John-based managed cloud and data center operator, has acquired Cloud-A of Halifax, forming an nationally focused IT infrastructure and cloud services provider with operations in New Brunswick, Nova Scotia, and Alberta.

The companies announced the transaction last night in a press release, but declined to reveal the financial details other than to say it was an all-stock deal. Cloud-A Co-Founder and CEO Brandon Kolybaba will remain with the merged group, becoming Vice-President and Chief Marketing Officer.

The Cirrus9-Cloud-A union will combine two companies on strong growth trajectories, and the principals believe the merger will actually accelerate the growth.

“We both [companies] have a particular offering that appeals to a certain type of customers, but some larger companies need both,” said Cirrus9 CEO Fred Bullock in an interview this morning. “They need a cost-effective offering for a portion of their needs, but for other they may want, perhaps, the securities-certification service or another service.”

He said the combined company will now be able to offer the range of services required by enterprise client. What’s more, the larger company will have greater visibility and may attract the notice of some companies that haven’t yet heard of Cirrus9 or Cloud-A.   

The two companies complement one another as they’re in related but distinct businesses, and they have little geographic overlap. Cirrus9’s client base is largely in Atlantic Canada whereas Cloud-A so far has done business outside the region.

Cirrus9, whose revenue has more than doubled each of the last two years, operates data centre facilities, managed enterprise cloud infrastructure and related hosting services. The company serves both public and private sector clients in many industries including the automotive, energy, financial services, healthcare, and telecom sectors to name a few. 

The company is a member of the East Valley Ventures stable of companies, having received investment from members of the Saint John investment and mentoring group in 2010.

Cloud-A offers a flexible infrastructure-as-a-service solution over the cloud for Canadian customers. It was formed in 2012 by Kolybaba, the Founder of Sheepdog Inc., and Dynamic Hosting Founder Jacob Godin , who collaborated with Dalhousie University in developing the product. They identified a need for an OpenStack-based elastic platform in which all the data is stored in Canada to take advantage of the country’s privacy laws.

“We doubled our customer base over the past few months,” said Kolybaba in the statement. “This will give us the platform we need to continue that growth at that rate and even accelerate it.”

Bullock said the two companies will continue to operate with own brand, but that the team is reviewing what longer range branding will be. “We each have our own following today and we do not want to abandon it,” he said.

Bullock said the company has no immediate plans to raise capital. But he added the accelerated growth may lead the company to consider a raise to finance the accelerated growth.

The Cirrus9-Cloud-A merger is part of a developing trend in Atlantic Canada in which startups are merging to accelerate growth by becoming bigger players. In February, Meductic, N.B.-based cymbal manufacturer Sabian Inc. bought drum equipment maker Billdidit Inc. of Sydney.  Other deals are in the works.

DC2GO’s Year 1 Sales Set to Top $1M


Last Friday was an important day for Andrew Coe and his company, DC2GO, which manufactures portable, customized data centres in Dartmouth. The company signed its first major sales contract.

But as he does every Friday, Coe drove out to the company’s prototype on a side road in Dartmouth’s Burnside Park.

Friday is the day when he runs its generator and makes sure all the components — the generator, cooling and security systems — are working smoothly.

But during conversation as he inspected the premises — really, a data centre built into a shipping container — he kept coming back to the sale and its importance for the startup.

 “It proves our solution is viable in the market,” said Coe, 24. “It gives us quite a bit of credibility to say someone is putting money behind us.”

What’s impressive about the DC2GO story is how quickly Coe has got to a strong stream of revenues. The company has bid on $5 million in tenders since it started last October, and has been shortlisted for each tender it bid on.

Though Coe is reluctant to discuss specific contracts, he did say the company is on track to exceed $1 million in revenue when it ends its first year in October.

Coe began to do tech consulting work around Halifax when he was 14, and a few years ago he realized there was a demand for data centres that were secure, portable and resilient. They could be used in disaster recovery, as telecom relay centres and meet the needs of a range of clients. Three years ago, he and his partner Jessica Gomes began to work on their prototype and last October opened for business.

The idea was not a complicated one: they decided to build a data centre inside a shipping container so it could be placed anywhere and moved at will.

Data centres are basically stacks of servers, and as the world becomes more and more dependent on data analytics, they become more critical to the operations of companies and large organizations. And the owners of data centres need to know they will run all the time, regardless of power outages, natural disasters or whatever.

DC2GO’s solution to this demand was to build data centres within shipping containers. Each unit has a generator to be used as a backup power system in case of an emergency.

There’s enough fuel to last several days. There are two air conditioners in each unit, with the second kicking in if the first cuts out.

The interior is fitted out like a small office. The prototype has four racks of servers, though they can hold as many as 20. The layout includes a small anteroom, meaning there are two doors to the data centre itself, providing double security.

DC2GO will now start filling the order it just won and has the capacity to build 15 units simultaneously.

 

Coe said the company will build the units through the summer and they should be ready by September.

So far, the company has been funded with $150,000 Coe has put into the enterprise. He is now raising financing with the goal of raising about $500,000, which will be used to expand the manufacturing facility and establish an office and sales team.

Press Release: NBIF Research Chairs


Three Researchers Receive $3.5 Million To Work With Industry

New Brunswick Innovation Research Chairs Announced

The New Brunswick Innovation Foundation (NBIF) today established three new applied research chairs valued at $3,525,000 over five years. Areas of research include the commercialization of plant-based omega-3 fatty acids for food and pharmaceuticals; advanced cyber security threat detection, response and mitigation systems; and biomedical human prosthetic and augmentation devices.

They are:

Dr. Marc Surette - New Brunswick Innovation Research Chair in Biosciences

Dr. Erik Scheme - New Brunswick Innovation Research Chair in Medical Devices and Technology

Dr. Natalia Stakhanova - New Brunswick Innovation Research Chair in Cyber Security

Today’s ceremony presents the first three of six recipients. Each will receive $1,000,000 in applied research funding over five years, plus two graduate research assistants and one research technician, valued at $175,000.

Obtaining the chair was a highly competitive process held over several months. In total, the province’s research institutes and universities sent 19 letters of intent. Of those, nine were requested to submit a written proposal and five invited to make a presentation before a selection committee of NBIF and PETL officials, academics and business people. Three were chosen, highlighted in detail below.

The remaining three chairs will be selected in the winter of 2015. The competition begins with a letter of intent to be delivered to NBIF not later than October 31, 2014. For the final round, preference will be given to candidates that are external to the applicant organization. For more information about the competition, click here.

The 2014 recipients of the New Brunswick Innovation Research Chair are:

Dr. Erik Scheme  - NB Innovation Research Chair in Medical Devices and Technology - University of New Brunswick - $1,175,000

As technology advances, the demand for advanced wearable medical devices has seen a rapid increase in the past five years, including smart prosthetic hands and limbs, multi-monitoring devices for human physiology, and more recently, human augmentation technologies. Dr. Scheme’s mandate is to position New Brunswick as a world leader in the discovery, innovation and commercialization of medical devices and technologies.

Dr. Marc Surette - NB Innovation Research Chair in Biosciences – Université de Moncton - $1,175,000

Common sources of omega-3 fatty acids currently come from animals, and most predominantly fish. However, their increased use in food and supplements is pushing demand beyond supply. Dr. Surette will work in partnership with agricultural companies to develop crops of a specific plant that is rich in omega-3 fatty acids, opening up new opportunities for farmers and industry in New Brunswick and beyond.

Dr. Natalia Stakhanova – NB Innovation Research Chair in Cyber Security – University of New Brunswick - $1,175,000

Despite enormous achievements in computing, the recent Heart Bleed Bug demonstrated that no organization, regardless of size, power, or wealth, is immune to cyber security threats. As more industries, enterprises, and governments integrate their online systems with countless other organizations, doing business in the digital age has opened a whole new set of problems. Dr. Stakhanova will lead the research and development of novel detection and response technologies for current, trending and anticipated cyber security threats, and facilitate their adoption by primary industries.

NB Liberalizes SME Tax Credit


When Gerry Pond is asked how good New Brunswick’s new Small Business Investor Tax Credit is, he says it’s among the best provincial tax credit for startup investments in Canada.

The provincial government liberalized its tax credit this year to encourage more investment in young businesses, and to give a tax break to corporations investing in young companies.

“Some people say that the British Columbia credit is the best in North America, but I think ours is at least as good,” said Pond, the chairman of East Valley Ventures.

In his February budget, Finance Minister Blaine Higgs responded to years of lobbying by the startup community and announced reforms to the tax credits – which are breaks in provincial taxes to encourage New Brunswickers to invest in small businesses such as startups.

Under the new provisions, which will come into effect for the 2014 tax year, New Brunswickers investing in small businesses in the province will receive a 30% non-refundable personal income tax credit of up to $75,000 per year.  So that means someone investing $250,000 in an eligible business, will receive a $75,000 tax break, but someone investing more than that amount could still only claim $75,000 in a single year.  The credit can be carried forward seven years or back three years.

What’s interesting is the government will now let corporations as well as individuals claim the tax credit. Natacha Poirier, Manager in Tax Service at Ernst & Young in Dieppe, said this will help owners of established businesses invest in startups in a more tax-efficient manner.

To claim a tax credit before, business owners had to take money out of their business (and pay personal income tax on it) and then invest the money. Now the corporate entity can invest its cash on hand in a new venture and receive the credit.

The tax credit for corporations is worth 15 percent and applies to investments of up to $500,000 per year.

“I think it will be great for the people who don’t have the funds immediately available (in their personal accounts) but don’t want to take money out of their corporation,” said Poirier. “Now they can invest through their corporation and receive the tax credit.”

New Brunswick is leading the region in allowing high investment limits in its equity tax credit program. Newfoundland and Labrador and Nova Scotia both have ceilings of $50,000 in their programs. 

Of course, the region still needs to address the problem of tax credits only being offered to residents of the province in question. Some U.S. states, such as Arkansas and Minnesota, have devised ways for people and institutions from outside their states to receive the tax credits to encourage greater investment in the fastest growing segment of their economy. Pond dreams of the day when the Atlantic Provinces extend credits to those beyond their borders, or at the very least to residents of other provinces within the region.

“I can get a credit for investing in Arkansas but not in Nova Scotia,” said Pond. “We have to fix that.”

 This article appears in the Spring 2014 edition of Entrevestor Intelligence, which you can find here.

StartupNL-Corner Brook Meeting Set


StartupNL-Corner Brook, the latest pod for the Startup Newfoundland and Labrador group, will hold its inaugural meeting on Monday at 6 pm at the Navigate Entrepreneurship Centre in Corner Brook.

StartupNL  and the Newfoundland and Labrador Association of Technical Industries have been working on the group for several months and are now moving ahead with the plans.

“We're looking for entrepreneurs and those that support entrepreneurs,” said StartupNL in a statement. “Brad Feld author of Startup Communities calls these leaders and feeders. We're hoping to identify a team of three or four leaders in Corner Brook that want to champion this project.”

The provincial body is offering support and looking for local leaders to step forward to organize the Corner Brook chapter.

The founding of the Corner Brook organization is the first step in a plan to spread the work of StartupNL across the province. 

Intelligence Report Highlights Funding


The most important trend in the Atlantic Canadian startup community last year was that provincial government agencies played a smaller role in financing startups than funds based outside the region and local private venture capital funds.

The June 2014 Entrevestor Intelligence Report, which we’re publishing here today, focuses on startup financing in the region, especially on equity financing for innovative young companies. Providing equity financing for these innovative young companies was until recently the domain of provincial agencies — the Nova Scotia Crown corporations Innovacorp and Nova Scotia Business Inc., and the New Brunswick Innovation Foundation, a not-for-profit that has certain governmental roles.

But part of the plan has always been for these agencies to take a back seat as other sources of financing come into the region. And our data show the provincial agencies accounted for $17.2 million or 78 per cent of the venture capital funding for Atlantic Canadian startups in 2012. Then it dropped to $6.9 million, or 22 per cent in 2013.

Overall, venture capital financing in the region rose to $31.2 million in 2013 from $23.3 million a year earlier. The big reason for the increase is the huge jump in funding from institutions based outside the region. This shows that exterior funding groups are taking more notice of the startup opportunities in Atlantic Canada.

“There’s definitely a different attitude among co-investors coming into the region,” said Patrick Keefe, a partner at Build Ventures. “Their interest started to tick up after Q1 and Radian6 were sold (in 2011) and continued after GoInstant exited (in 2012).”

The research by Entrevestor shows that investments from these venture capital and private equity firms soared last year — to $15.4 million in 2013 from $800,000 in 2012. Last year, BDC Ventures made its first investments in the region in four years, and initiated its convertible debenture program with Launch36. Under that program, it issued $150,000 in convertible debentures to Analyze Re, Eigen Innovations, FoodTender, R17, and topLog.

Build Ventures itself represents the final trend we’re seeing in the venture capital space — the rise of private, local financial bodies. These groups invested $3.8 million in local startups in 2011, but more than doubled their contribution to $8.9 million in 2013.

So are the provincial agencies starting to wind down? Not a chance. The New Brunswick Innovation Foundation has been on a roll lately, booking two exits in the last three years and taking a leading role in the New Brunswick government’s $80-million innovation program.

There’s a review underway of venture capital in Nova Scotia, but no one expects the government to get out of this line of work. And Newfoundland and Labrador is now putting together a fascinating private-public partnership for financing startups — an initiative detailed in the Entrevestor Intelligence Report.

The report provides data on key federal funding programs, and details on Verafin, the Newfoundland company that received $60 million in private equity funding last month. The supplement also features the first directory for the region’s startup community.

Announcing the Startup Directory


We’re pleased today to unveil the first Atlantic Canada Startup Directory, sponsored by Launch36.

The directory is published today in the Spring 2014 Entrevestor Intelligence report, which is now on our site. Hard copies will be available next week, and will be available at the Atlantic Venture Forum. We’ll do our best to get copies out to groups in all four provinces.

The directory includes the coordinates for 159 startups, arranged in four main groups, IT, Life Sciences, Cleantech and Advanced Manufacturing. It also has a selection of service companies that are part of the community.

We have also included information on a range of support organizations, under the following headings:  Education, Finance, Government, Industry Associations, Management Consultants, Media, Mentoring/Work Spaces, Professional Services and 3D Design & Printing.

The goal of the directory is to help connect people within the community, and to give people outside the region document to find companies in the region. We hope it will be something people keep on their desk as a resource.

We’d really like to thank Trevor MacAusland at Launch36 for stepping up and sponsoring the directory. Kudos also to our tremendous layout artist Roxanna Boers and for last minute assistance from Allan Gates and the crew at Bonfire Stories

Strong Startup Voice in NS Panel


Nova Scotia Premier Stephen McNeil yesterday unveiled an economic planning panel that is rich with talent from the startup community.

The 17-member panel, to be chaired by the premier, will take a year and a half to devise a 10-year economic plan in keeping with the report of the recent Ivany Commission on the Nova Scotian economy. The panel is being greeted with some skepticism, but there are a few things I really like about it.

First, it’s remarkably similar in structure to Premier David Alward’s New Brunswick Research and Innovation Council, announced last year. Both bodies include opposition leaders, a broad range of community leaders and a steep concentration of knowledge economy entrepreneurs. It would be great if these two panels sat down together to discuss harmonized policies that would benefit the whole region. It would be better still if representatives from Newfoundland and Labrador and Prince Edward Island joined them.  

Second, it’s great that both premiers brought in opposition members to these panels. It highlights the importance of their work and builds hope that it will continue if governments change.

Third, and possibly most important, the Nova Scotia panel has a lot of talent from the startup community – people who understand the economic necessity of local companies selling technology to the global market. They include: J.P. Deveau, president, Acadian Seaplants Ltd.; Saeed El-Darahali, president and CEO, SimplyCast.com; and Jevon MacDonald, GoInstant.com. These are not just people who’ve worked in the private sector. They are people who have built up successful companies by commercializing proprietary technology.

Other members of the group, such as Dalhousie University vice-president of research Martha Crago and Engage Nova Scotia head Danny Graham, understand the power of startups in galvanizing the economy.

The startup community is becoming more and more a pillar of the business community, which is a healthy development.

 

Press Release: SimplyCast And SMU


SimplyCast in Partnership with Saint Mary's University Executive and Professional Development to Launch Leadership Training Course

SimplyCast is looking to create leaders among its team by offering comprehensive communication and management training.

The Saint Mary's program, designed by instructor Brenda Fair, develops communication skills and strategies through team building exercises and ongoing communication challenges.

Dartmouth, Nova Scotia, May 28, 2014 - SimplyCast.com, a global leader in multi-channel marketing Platform-as-a-Service solutions, today announced that the company has partnered with Saint Mary's University Executive and Professional Development in order to offer company staff a professional business course which will help train them for leadership and management roles, while increasing their knowledge of communication challenges and solutions.

The training course allows employees to work alone and in groups to assess many communication strategies, participate in team communication exercises and learn new ways to effectively communicate with different types of personalities.

“Our employees are our most valuable assets, and we want to ensure that they have the skills they need to succeed and keep our company strong and progressive,” said Saeed El-Darahali, President and CEO of SimplyCast. “We would like to thank Saint Mary's University for helping us train the next generation of leaders.”

A core SimplyCast value is finding great people who are passionate and talented, regardless of their experience level and investing in their future. Many employees do not have prior management experience and this course is designed to add to their knowledge while building on their established skills. SimplyCast is committed to developing leaders who can thrive in a business environment while helping to grow and innovate the local community.

The entire SimplyCast team would like to thank the Nova Scotia Department of Economic and Rural Development and Tourism for their support and assistance with the management training program.

ERDT is dedicated to supporting economic growth in Nova Scotia.

SimplyCast 360 is an automation marketing solution designed to reduce manual tasks while allowing organizations to communicate with their customers and clients in a highly targeted way that was previously unavailable on the market. SimplyCast 360 is used by the e-commerce and automotive industries, sports teams, nonprofit organizations, marketing agencies and government. It is also ideal for communication in emergency situations such as forest fires, bomb threats or blizzard warnings.

About SimplyCast

SimplyCast.com is a leading provider of interactive and multi-channel communication software for organizations worldwide. The company’s 360 Customer Flow Communication Platform is a feature-rich solution combining marketing automation, inbound marketing and interactive communication.

With customers in over 175 countries, including many of the most recognized brand names around the globe in retail, non-profit and hospitality industries, SimplyCast provides organizations the ability to effectively reach customers on their preferred mode of communication.

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EY to Buy Ambir Solutions


Ambir Solutions, one of Atlantic Canada’s leading technology consultancies, has agreed to join EY Canada (formerly Ernest & Young) as part of its business consultancy division.

The Saint John-based service company, which has offices in Halifax, Fredericton and St. John’s,  said in a statement it had signed a letter of intent to join EY. The organization’s 60 employees will all be joining the international firm.

“We decided last year that we were going to embark on a growth strategy, only we envisioned it would be as independent company,” said Ambir CEO Ian Cavanagh in an interview Thursday afternoon. “But this opportunity presented itself, and the opportunity to join forces with a global firm like this is a very exciting one.”

He explained that in the fallout of the Enron scandal in 2001 the large accountancy firms were forced to divest their business advisory units. But eventually they learned to operate within new regulations and began to grow that side of the business again. EY has been growing aggressively, and several of its five acquisitions in Canada in the past four year have been designed to bolster its business advisory division.

Cavanagh, who was a finalist in EY’s prestigious Entrepreneur of the Year Award in 2010, said there would be no layoffs because of the transaction. And he stressed that the two companies complement one another very well in terms of business mix and culture.

Ambir’s award-winning business and IT consulting services team is focused largely on technology, whereas EY’s advisory business concentrates on business development. So there is little overlap.  

“We’re proud to be aligning EY’s brand and global reach with Ambir’s unparalleled client service and sector expertise,” Trent Henry, EY’s Canadian Chairman and CEO, said in a statement. “Ambir truly is the leading independent IT and business consulting firm in Atlantic Canada. We’re looking forward to building game-changing services, together.”

The two sides have been working on the deal for about six months, and Cavanagh said they have learned the cultures at the two organizations are remarkably similar.

“I would never have done this deal if we couldn’t tick a couple of key boxes,” he said. “Strategy is one and another is culture. We found someone we have a great cultural fit with and I wouldn’t have expected that in a big company.”

He added EY is passionate about growing in Atlantic Canada, and the addition of the team from Ambir will help achieve that goal.

Cavanagh is a former board member of PropelICT and said he will continue to pursue his passion for entrepreneurship in the region. 

Profile: The Hankinsons’ Golden Touch


They are stars in the regional startup community, enjoying a high degree of success at a young age.

When they are asked to explain their early achievements, brothers Stephen and Patrick Hankinson say that growing up in rural Nova Scotia they had few leisure options, so they began tinkering with their dad’s computer, learning a passion for tech and entrepreneurialism from him.

Both credit their father’s enthusiasm for computers and his own entrepreneurial leanings — Owen Hankinson ran a car dealership and gas station in the riverside community of Weymouth — with inspiring them. There may also be other genetic components to their success — their family line includes store owners, a shipbuilder and myriad other business people.

“Dad had a computer in the house since I was two. Dad loved technology. The first ISP (Internet Service Provider) in Weymouth was on top of his garage,” explained Stephen, 32, an electrical engineer and co-founder of Affinio, the Halifax social media analytics company. He is also the Co-Founder of 26ones, the Halifax engineering and incubation operation he runs with partner Tim Burke. 

“As kids, we started website businesses,” said Patrick, 26, who focuses on marketing and is a co-founder of Compilr, a Halifax startup that teaches people how to code.

“We ran an online website to sell computer parts and another that sold general merchandise.”

Compilr has recently been acquired by lynda.com, a California online education company, for an undisclosed sum.

“We were always trying to sell something,” Patrick said. “In a small town, the only way to solve our entrepreneurial itch was running an online business.”

The brothers say they always knew they would be entrepreneurs, like their forebears, who include great-grandfather George Hankinson, who ran a general merchandising and lumber business and also started Hankinson Shipbuilding Co. George and their grandfather, Ken Hankinson, sold Irving products early on in K.C. Irving’s own entrepreneurial journey, Patrick said.

Many of their cousins are in business, including James Hankinson, who has served as CEO and president of Ontario Power Generation, as well as CEO and president of New Brunswick Power Corp.

“Even our mom, Sharron, started her own daycare from our house and grew it large enough to need a new building,” Patrick said as the brothers relaxed in the bright new Bedford offices of Affinio.

The brothers respect each other’s talents and have collaborated on various projects, including the wildly successful Tether, which allowed people to go online on their laptop using their smartphone plan. Stephen, who is widely known for his technical speed and ability, built the product in just a month and they, together with Burke, launched it in March 2009, accruing six figures of revenue within three days.

The brothers will probably work together again, but right now both are busy with their own ventures.

Patrick and co-founder Tim Speed are continuing to operate Compilr from Halifax, despite selling their company to lynda.com.

“We’re growing our local team and we have a new office on Argyle Street,” Patrick said. “We are integrating our technologies with lynda.com. It’s interesting to be part of a massive organization. I like the knowledge-sharing. Lynda has a lot of processes in place that make me wonder, why didn’t I do that?”

After Affinio raised $1.5 million from Build Ventures, the Halifax regional venture capital fund, last October, Affinio is piloting its product, which allows small businesses to mine social media and other data to find potential customers, partners or employees.

Stephen says he is “at full tilt, travelling all over.”

“We’ve had a lot of interest in New York.”

The brothers believe they are natural-born businessmen but say they are more reserved than is ideal in an entrepreneur. They cherish their alone “thinking” time, but they also solicit each other’s advice; the close relationship allowing them to be franker than they might be with others.

“We haven’t killed each other yet,” Stephen joked as the two began to make plans to meet up for an online gaming session.

Bringing Urgency to #StartupEast


Paul Singh has a message that Atlantic Canadian startups need to listen to.

Singh is the founder of Disruption Corp. in Arlington, Va., which recently announced a $50 million post-seed fund for startups.

Last year, when he was working for another investor group called 500 Startups, he visited Halifax twice. He will return next month to be one of the speakers at the Atlantic Venture Forum.

Frequently, when he travels, he sends out tweets along the lines of the one he posted May 20, which said:

“How to build a Silicon Valley in your own city:

1. Focus on importing urgency.

2. Recognize that #1 is hard. Do more of it.”

Singh preaches urgency quite a bit, and tweeted about the need for it last September when he attended the MentorCamp in Halifax. He may do it again next month. And he probably should. East Coast startups need more of a sense of urgency, especially when it comes to selling their product.

Consider some of the data recently collected from the Entrevestor survey of East Coast startups in January and February. We received figures for 148 startups in the region, and 76 had revenue of $10,000 or less last year.

Yes, more than half the startups that we surveyed had virtually no sales. In Nova Scotia, 56 per cent of the startups fit into this group, compared with 51 per cent in New Brunswick.

(To avoid being called a fear monger, I should add that the other half of the respondents include many companies with impressive revenues. The sales numbers among these companies rose about 30 per cent in 2013.)

So why do we have so many companies with low or no revenue? One reason is the startup community is young, with about one-quarter of the companies only one year old. About 70 per cent are less than three years old. Also, many life sciences companies need years of product refinement and regulatory clearance before they bring in revenue.

But I think the more likely reason is that there is simply not enough of a sense of urgency — to use Singh’s term — in the collective sales missions in our startups. Of course, there are some great business development and sales people in the community. There just aren’t enough of them.

This could be a huge problem before too long because all those young companies are hitting puberty. There’s a broad swath of companies that have been around for a few years and have raised a few hundred thousand dollars in seed financing. They’re looking for more capital to grow.

In my discussions with venture capital investors lately, I’ve been hearing one clear message: they’re not interested in investing in companies that don’t have strong and growing sales.

If you don’t have those sales and you’re running out of money, the situation might become, well, urgent.

It’s a message Paul Singh might just raise again when he visits Halifax next month. 

AVF Names Presenting Companies


The organizers of Atlantic Venture Forum have named 24 companies to present at the two-day event next month, representing all the main segments of the startup community.

The second annual AVF, presented by Critical Path Group, will take place at the Westin Nova Scotian in Halifax on June 17-18. One of the great features of the event is that local companies get to pitch to the entire forum, which includes local and international investors.  

There will be two more presenting companies than last year, and one person familiar with the deliberations said the organizers had a tough time deciding which of the 65 entries should take the stage.

Half the companies are in the IT space, which means the organizers are giving ample air time to life sciences and cleantech companies.

The presenting companies are:

 Growth Stages Companies

 Atlantic Hydrogen, Fredericton

Chelation Partners, Halifax

Chemgreen Innovation, Sackville, NB

Eigen Innovations, Fredericton

Halifax Biomedical, Mabou, NS

InNetwork, Halifax

Livelenz, Halifax

Marcato Festival, Sydney, NS

Neurodyn, Charlottetown

RtTech Software, Moncton

Sagecrowd, Halifax

Zed Creative Inc. Spot

Early stage

Adeptio, Charlottetown

Cellufuel, Halifax

DashHudson, Halifax

DeCell Technologies, Halifax

DeNovaMed, Halifax

FoodTender, Shediac, NB

Heimdall Networks, Sydney, NS

Hyton Innovation, Fredericton

Island Water, Stratford, PEI

Kinder Guardian, Moncton

Proposify, Halifax

Spring Loaded Technology, Halifax

The investors attending the forum will include representatives of such groups as Relay Ventures, Rho Canada Ventures, Real Ventures, White Star Capital, Tandem Expansion Fund,  BDC Venture Capital , Maple Leaf Angels, IncubateNYC, 500 Startups , Azure Capital, Boston Millennia Partners, Lumira Capital, Bain Capital, GrandBanks Capital,  iNovia Capital, Launchpad Venture Group LLC and GroupArgent.   

Community Mourns David McNamara


Many in the region’s business world are saddened by the death of David McNamara, former vice president of incubation at Innovacorp in Halifax, who has died at the age of 63 after just two months of retirement.

Business leaders have been quick to praise McNamara’s long service to the province, both at Innovacorp and in many senior positions in community, economic and business development.

“David served our province with distinction for over 42 years and we were fortunate to have him head up our incubation practice since 1995,” said Stephen Duff, Innovacorp’s President and CEO.
“David was a true champion of the entrepreneur and played a significant role in helping develop our startup ecosystem. It seemed to me that David knew just about everyone in this town and beyond, and he took great pride in connecting people in meaningfully helpful ways.

“He was a mentor to many and typically my primary source of intelligence was during water-cooler chats with David that would reveal insights I would eventually read in the following weeks from more traditional news sources. He has been taken from us way too early and his Innovacorp family will miss him immensely.”

As Innovacorp’s vice president of incubation, McNamara’s focus was on overseeing the Technology Innovation Centre in Dartmouth, the Innovacorp Enterprise Centre in Halifax, and the grow-out facility at 101 Research Drive.

He also drove the creation of the BioScience Enterprise Centre (BSEC) in the late 1990s. A dozen years later, he led the creation of the Innovacorp Enterprise Centre on Dalhousie’s campus. He also played a significant part in turning 101 Research Drive, Innovacorp's former headquarters, into a new home for Ocean Nutrition Canada to grow from being a BSEC incubation client to an entity later acquired for $540 million by a Dutch multinational.

McNamara consulted on incubator development around the world and frequently shared his expertise at National Business Incubation Association (NBIA) and Canadian Association of Business Incubation (CABI) conferences.‎ He was president of the Entrepreneurs’ Forum; a long-time member of CABI's board of directors and executive team, and a volunteer  for many business community initiatives. Most recently, in his capacity as CABI’s president, he helped create an incubation stream under the federal government’s Start-Up Visa program for immigrant entrepreneurs.

CABI bestowed an award of merit on McNamara in 2012, honouring his achievements in transforming Innovacorp into a model program for business incubation and for his continuing leadership within the Canadian Business Incubation Industry.

McNamara was extremely popular and was known for his wit, his sense of style and his love for his home province. An accomplished golfer, he spent many hours at both the original and new Ashburn with his friends and business associates. 

Catalfamo Reflects on Radian6 Deal


Joe Catalfamo had heard the story of Radian6 before, but he certainly didn’t seem to mind hearing it again.

The managing partner of the Toronto venture capital fund Summerhill Venture Partners sat happily at the back of the hall during a panel discussion at Canada’s Venture Capital & Private Equity Association's annual meeting in Ottawa last week.

On the stage, Radian6 CEO Marcel LeBrun told the story of how angel investor Gerry Pond got him together with fellow entrepreneurs Chris Newton and Chris Ramsey. Together, they decided to launch a company that would help corporations monitor and analyze their social media.

The company, Radian6, ended up being purchased by Salesforce.com of San Francisco for $326 million in 2011 and gave impetus to the regional startup craze. It got the venture capital deal of the year in 2011 from the association.

LeBrun mentioned in the discussion that one reason the company took off was it had backing from several venture capital backers at a time when venture capital funds tended to ignore Atlantic Canadian companies.

Pond, other angels and the New Brunswick Innovation Foundation backed the startup. But as well as the local support, Radian6 received investment totalling $9 million from Summerhill, Brightspark Ventures and BDC Venture Capital.

“No one region has a monopoly on good ideas,” Catalfamo said when asked last week why he invested in an Atlantic Canadian company when few others did.

What’s more, he had been coming to the region, New Brunswick in particular, for years and understood the brainpower that Pond and his colleagues had assembled. Catalfamo had been brought to the province in the 1990s to see ImagicTV, LeBrun’s previous startup. It was a pioneer in streaming television over the Internet, and Catalfamo was impressed by the concept, the execution and the support network.

When he heard about the team putting together Radian6, he invested. It worked out well for him — Summerhill and the other funds earned a total return of 22.8 times their original investments over three or four years.

For his part, LeBrun said the sale of his company benefited Atlantic Canada in several ways. Radian6 is now a key component of Salesforce, one of the world’s great software companies. It employs more Maritimers than when it sold out, with offices in Fredericton and Halifax. And the Maritime investors in the company have since invested in 37 other regional startups.

Catalfamo said his fund is fully invested now, but he continues to follow what’s going on in Atlantic Canada. He applauds the development of the startup community in the region and said it will likely be a great vehicle for attracting expatriate Atlantic Canadians back to the region. And he saluted Pond and his colleagues at East Valley Ventures in Saint John, N.B., for continuing to develop the ecosystem for starts.

“I have so much respect for all those people because they care so much about the region.”

Detailing the Startup Jobs Boom


As her business grows, Gillian McCrae is rewarding more than just merchants and their customers.

She’s also rewarding a lot of workers.

McCrae is the Founder and CEO of GetGifted, a year-and-a-half-old Charlottetown startup that allows local merchants to give customers vouchers for gifts that can only be redeemed in person. The idea is to draw people to the outlets where they’ll spend money. As it grows, it needs more employees.

“Right now, we are at five employees based out of P.E.I.,” said McCrae. “I’m working on three employees in Halifax. In 2014, we’re probably going to be up to 12 to 16 employees, based in P.E.I., Halifax and Toronto.”

McCrae’s experience exemplifies the power of startups in creating employment. Though the sector is young in Atlantic Canada, it’s already created about 3,000 direct jobs. If you include indirect jobs, the startup boom could account for about 15,000 Atlantic Canadian jobs.

Determining firm statistics on the jobs created by startups in Atlantic Canada is difficult on several levels. First, these are small diversified companies, all privately owned and not compelled to reveal their employment numbers. Second, startups in their purest form are developing scalable products from proprietary technology. There are dozens of companies in the region that don’t quite meet that definition. And some of the jobs created are located outside the region, especially by companies with foreign sales teams.

But the results of our survey, coupled with interviews with dozens of companies, show that startups are creating a substantial number of jobs in Atlantic Canada. There were at least 2,400 people working for 290 Atlantic Canadian startups at the end of 2013. If you include companies that have exited, such as Radian6 and Ocean Nutrition Canada, direct employment rises to about 3,000.

Those are, of course, just the direct positions.  Research by Enrico Moretti of the University of California at Berkley shows that each high tech job creates 4.3 indirect jobs due to professional services, taxes and individual spending. Applying multiplier to the Atlantic Canadian startups (which is dominated by tech), it’s easy to estimate the 15,000 jobs have been created because of this movement.

The truly jaw-dropping aspect is the speed with which startups are ramping up their staff levels.

Let’s focus just on the 162 companies that responded to the Entrevestor survey. They told us that they employed a total of 1,453 people as of Dec. 31, 2013, up 43 percent from 1,019 a year earlier. This is actual evidence of job growth within the startup community.

The total payroll reported by the surveyed companies in 2013 was $75.8 million, up 44 percent over the previous year.

Another interesting factor is that these 162 companies taken as a whole don’t show any signs of slowing down their hiring. These companies plan to hire a total of 759 new employees in 2014, which would represent a 52 percent increase over the end of 2013.

"The reason that Startup initiatives (Startup America, StartUp Canada, Startup Spain, Startup Malaysia etc.) took root and spread so quickly internationally was because leaders bet that their innovation-based startup sectors would drive much needed employment gains to help economies recover,” said Dawn Jutla, a professor of entrepreneurship at the Sobey School of Business. “This economic insight is playing out right here at home in Atlantic Canada with our higher startup employment figures.”

For Gillian McCrae, who hopes to triple her staffing this year, the jump in employment was part of the vision when she began the company in late 2012.  “I guess that’s been the intention all along – to give people jobs, really great jobs.”

This article originally appeared in our Spring 2014 Entrevestor Intelligence report. 

Press Release: CATA Awards


Atlantic Canadian Expertise Recognized in Awards: Leadership & Innovation

Atlantic Canadians were featured in the 2014 Award Winners at the most prestigious event of the high-tech industry.

The 29th Annual Gala of Canada’s largest high-tech association  -  the Canadian Advanced Technology Alliance  --  featured a keynote address from CATA National Spokesperson & Chair of Mitel and Wesley Clover, Sir Terence Matthews who reported on the status of Canada's innovation nation, and next steps for boosting our competitive performance.

The Wilfrid Laurier University Public Sector Leadership Award in Advanced Technology went to Brad Woodside, Mayor, City of Fredericton, New Brunswick.  "Brad has coordinated Fredericton's remarkable drive to high-tech prominence," said CATA President John Reid.  "Fredericton has been named three times as a Top Seven candidate in the Intelligent Community Forum's (ICF) Most Intelligent Community competition, and was once the only Canadian city to be in the running.

The Peter Brojde Award for Canada’s Next Generation Executive Leadership was awarded to Ashwin Kutty, President and CEO of WeUsThem. The award recognizes executive leadership of an individual who has had a major impact on the creation, success and/or transformation of their enterprise.  “Receiving an award is a honour in itself, but to be awarded one in the name of one of Canada's pioneering greats, Peter Brojde, is truly humbling," said Ashwin Kutty of WeUsThem. "The key to my success has been the team I have had the good fortune of surrounding myself with. This award from CATAAlliance, is as much theirs as it mine."   Halifax based business WeUsThem provides for consultative services across various functional areas, such as Marketing and Communications, Information Technology, Information Management, Knowledge Management and across a variety of industries, including healthcare, education, oil and gas, entertainment, fashion, hospitality and real estate.

Salesforce.com is a U.S-based company that picked up much of its acumen from Fredericton-based Radian6.  “They have incorporated our thinking, particularly around where things are changing in the marketing world,” said former Radian6 CEO Marcel LeBrun.  Mr. LeBrun, now SVP and GM of Salesforce, added that “We’re at the core of the vision of where the company is going.”  Salesforce.com was presented with the Special Award for Advocacy Leadership.

St. John’s, Newfoundland native John Kelly was presented with The Telfer School of Management Private Sector Innovation and/or Leadership Award in Advanced Technology.  John is a serial entrepreneur, leading many notable companies in the Ottawa-area. He is co-founder of Murphy Business Ottawa and co-owner of Comfort Keepers Ottawa, a non-medical care business.  John is the former CEO of JetForm Corporation and principal of Reid Eddison Inc.

For more information about the Awards, please see:

http://www.cata.ca/Media_and_Events/Press_Releases/cata_pr05231401.html

For nearly three decades, the CATAAlliance Innovation Awards Gala has been celebrating the best in Canadian advanced technology from coast to coast.

Press Release: Cloud-A’s “Seeded”


Cloud-A Launches “Seeded”: Cloud Support for Startups 

Halifax, Nova Scotia, Canada – May 23, 2014 -- Cloud-A, Canada’s high performance Cloud, announced it is launching “Seeded” – a program to support the development of internet based, seed stage startups.

Interested startups need to sign up for the program and once verified will receive six months of unlimited access to their Cloud platform, giving startups room to grow without worrying about limits; the ability to schedule one-on-one time with members of the Cloud-A team to chat through technical, or business related challenges and all the benefits of Cloud-A’s open platform: no contracts, less stress, no strings. All backed by Cloud-A’s no compromises support from our team for your infrastructure.

The program is not limited to startups in any particular region; nor is there a deadline to sign-up.

Cloud-A’s team, all being startup founders, understand the issues and challenges facing any new venture. Cloud services today are a tremendous benefit for startups providing services that a even decade ago would have been beyond the financial means for many startups. Cloud-A’s tools and storage will allow startups to save money while providing a level of resources to respond and scale to growing or unexpected demands of a new business with ease; all without the need to buy, manage and maintain physical infrastructure themselves.

“Everyone on our team knows what it takes to launch a startup. This is a way for us to support fellow startups with our resources and knowledge. We’re proud of what we have built at Cloud-A and know it can be a significant benefit to other startups,” said Brandon Kolybaba, co-founder, Cloud-A           

To apply for the program and see complete details, please visit: https://www.clouda.ca/technology/seeded/

About Cloud A

Cloud A is a leading provider of Cloud Infrastructure powered by OpenStack® based in Canada. Our product simplifies the installation and management of the hardware and software that provides the infrastructure for large scale environments having hundreds or thousands of servers supporting Big Data, Analytics, or High Performance Computing. For more information visit http://www.CloudA.ca

Contact:

 Rob MacArthur

rob.macarthur@clouda.ca

902-402-1828 – Mobile

Cloud-A (http://www.CloudA.ca)

 1-855-925-6831 – Office

info@CloudA.ca

@CDNcoudA

James Seeks Funds for Enablers.ca


Three years ago, Roswell James was suffering from shingles, which so weakened his eyes he could only use them for brief periods each day. In that precious time, he went online to research his condition, but found there was no one site that contained all the information he needed. So, when he recovered, he set about creating his own site -- Enablers.ca, the disability site -- a one-stop shop for information on living with a wide range of diseases and disabilities.

For the last two years, James, a book-keeper, has been funding the site himself and working on it weekends and evenings. He has been the recipient of a great deal of goodwill and donated time, and a lot of work has been completed on ten common diseases, but there are around 490 still to research and input. Now, he is looking for $500,000 in funding to speed up the site’s rate of development to the point where advertisers will be tempted aboard.  

“I need money to get this thing to fly,” said James from his narrow work space on Quinpool Road in Halifax, which has been donated by AFS Agency, one of James’s book-keeping clients. “A lot of people have helped me get this off the ground, but we need to get it to work on a larger scale. I haven’t tried for advertising yet as I felt we needed to develop the site to a certain point before approaching advertisers, but we’re there now.”

James believes advertisers will part with their cash because the site provides direct links to their sites. Enablers.ca also already contains a lot of information on various conditions, FAQs, government and not-for-profit organizations, news about goods and services as well as blogs and personal stories. The site looks at disabilities from many points of view – for instance, learning to live with a disability is considered from both an employee and employer’s perspective.

James, who has lived with epilepsy and associated health conditions all his life, said the focus is on understanding and surmounting disability.      

“If you understand your disability, you can overcome it,” he said.

Currently, James’s only assistant is Kashif Kashif, a computer science student at Saint Mary’s University. Kashif is building the site’s schizophrenia segment and helping with uploading youtube videos. The student’s paycheck is being partially funded by the provincial government; the only financial backing the project has received so far.

“We’ve listed almost 500 common disabilities we need to build, from autism to schizophrenia. It’s a huge job. I need about five people to get it done and I want them all to be people with disabilities because they’ll have personal understanding of the issues,” James said. “In a year’s time, I want this to be a national entity that doctors tell their patients about.”

Enablers.ca is not James’s first entrepreneurial activity for disabled people. In the 1970s, he created talking books for the blind. In the 1990s, he was an early pioneer of internet selling with an online bookstore. This went well, he said, until he was put out of business by the growth of Amazon.

He said that Enablers is allowing him to bring his past experiences and passion together. “Working with people with disabilities means a lot to me,” he said. “I would like to give others the tools to overcome their disabilities.”       

Mirametrix Wins BDC Innovation Award


Mirametrix, a Montreal company that makes it easier for people to use computers, has won the first BDC Innovation Award, edging out three other competitors including an Atlantic Canadian company.

Launched in 2011, Mirametrix has developed software that allows people to operate computers or devices with their natural acts. It tracks the user’s eye as he or she reads a screen and integrates the eye-tracking with other actions, such as speaking or gesturing.

“We bring to market a novel way to interact with laptops, tablets and other devices, creating a world of new opportunities in usability, security, learning, gaming and entertainment,” Denis Lavallée, CEO of Mirametrix, said in a statement. “More than 2 billion units of electronic products are sold worldwide on an annual basis. This award is a great validation of our go-to-market strategy and our potential for fast growth."

The company is one of the first portfolio companies of TandemLaunch in Montreal, a company creation platform recently supported by BDC Venture Capital.

Mirametrix expects the technology will be readily accessible to the public in less than two years. The company’s software is currently used by more than 250 clients in 42 countries, including global leaders in higher education like Stanford, Harvard and McGill University, as well as market leaders in software and gaming like Microsoft and Sony.

 “The gaze tracking solution developed by Mirametrix has the potential to transform the way we currently interact with devices much in the same way the mouse did in the early 1980s,” said Jérôme Nycz, Executive Vice President of Subordinate Financing and Venture Capital at BDC. “The opportunity for disruption is massive.”

The BDC Innovation Award, awarded for the first time this year, is organized by the Business Development Bank of Canada and Canada’s Venture Capital and Private Equity Association, or CVCA, to recognize outstanding Canadian startups. A person familiar with the process said the organizers received a range of strong submissions and eventually narrowed them down to a shortlist of four companies. The finalists include Smart Skin Technologies of Fredericton, which is commercializing a pressure-sensitive surface material devised at University of New Brunswick.

“We were nominated by our investors and thought this would be a good opportunity for Atlantic Canada to demonstrate it can build Grade A companies,” said Smart Skin CEO Kumaran Thillainadarajah. “We happen to be based in Atlantic Canada, but we are competing globally. We have a world-beating technology and have built a great company around it.”

The award was announced at the CVCA Conference in Ottawa, at which the association said Robert J. Deluce, CEO of Porter Airlines Inc. won its ‘Entrepreneur of the Year’ Award.

BDC Venture Capital and GrowthWorks won the ‘Deal of the Year’ Award for the venture capital category for their investment in Layer7 Technologies, which sold out to CA Technologies last year.

Fulcrum Capital Partners and Brookfield Asset Management Inc. capture the private equity category for their investment in A & B Rail Services Ltd.

Internet of Things Creates New Models


The profound growth of the Internet of Things is creating new business models in which Big Business is becoming more open and collaborative and creating opportunities for startups, the CVCA Conference in Ottawa heard Wednesday.

A panel of the Internet of Things – in which machines communicate with one another and adjust automatically based on the data they send one another – revealed that this segment offers huge potential. Panelists also said the Internet of Things will be so big and so vast that companies will have to change their models, attitudes and processes. And that’s where the huge opportunities are being created.

“Atlantic Canada is primed for this,” Scott MacDonald, the Co-Founder of McRock Capital and the moderator of the panel, said later in the day. “It has all the resources needed for this space. It’s a university-rich environment and it has all the talent to capitalize on this.”

MacDonald said the Internet of Things is creating huge opportunity because it is growing so quickly. There are estimates that the segment will be worth $19 trillion by the end of the decade and that 50 billion devices will be connected to each other. In Atlantic Canada, especially in New Brunswick, several companies like Shift Energy, RtTech, Smart Skin and Eigen Innovations are forging ahead with IoT products.

Carl Stjernfeldt, the senior technology principal at Shell Technology Ventures, said major and small oil and gas companies are looking for productivity improvements in their operations, and understand that startups can produce the technology that brings about the improvement.

“There’s a square wave of technology coming into the oil patch and the majors know they can’t develop it themselves,” said Stjernfeldt, whose parent company is Royal Dutch Shell. He added that the big companies are acting “more rationally” and not demanding exclusivity when they adopt new technology. “Access to technology is the key; exclusivity is not,” he said.

In fact, companies are now coming to realize that having more players use new technology helps to improve new products and establishes industry standards, which helps everyone in the long run.

Stjernfeldt’s advice for startups approaching big companies is not to “get stuck in” the R&D division. He said startup founders often get comfortable making connections with researchers but the best route is to go right to the operations managers, the true end-users, and show them how the new product can improve their productivity and/or safety.

Victor Woo, general manager of the Internet of Things at Cisco, said his company is now investing $100 million in young companies involved in the Internet of Things, and is especially interested in what startups are doing in Canada. Last week, the company announced the Cisco Chair in Big Data at the University of New Brunswick.

Major companies are looking for solutions on how machines and devices can communicate, analyse and act instantly, and the complexities and opportunities are endless, he said.

“It’s all about handling data at a planetary level because we’re going to be dealing with 50 billion objects by 2020 and that’s massive,” said Woo.

The panel – which took place the annual meeting of the CVCA, Canada’s Venture Capital and Private Equity association – also highlighted that large companies are becoming more open to sharing their data because they understand it can result in productivity gains.

“It’s a business model that didn’t exist before,” said Stjernfeldt, gesturing to Woo on his left and a representative of GE Canada on his right. “I’m willing to let someone like Cisco or GE have access to my data. Then they can crunch it and I’ll buy it back. That’s new.”

 

Scene Sharp Revamps Sales Model


Scene Sharp Technologies Inc., a Fredericton software company that improves the quality of colour digital photography, is ramping up its sales effort through a series of deals with international distributors.

Scene Sharp is the company set up to commercialize the research of Yun Zhang, the Canada Research Chair in advanced geomatics image processing at the University of New Brunswick. Zhang has created software that greatly enhances the precision of digital photography, so it improves the colour of satellite photos, the resolution of high-speed shots and a camera’s sensitivity to light.

Two years ago, it hired as CEO Ian Lucas, a veteran of Ocean Nutrition Canada, the Dartmouth food additive maker that sold out to Royal DSM of the Netherlands for $540 million in 2012. In the last six months, Lucas has shifted the company away from a direct-sales model to a distributor- and channel-based model. And the new strategy is starting to pay off.

“We had to reinvent our business model,” said Lucas in an interview last week. “Through the distributors we now have access to end-users for our image processing software products, and that’s created a large pool of early adopter customers. The goal is to sign 20 distribution contracts this year and this means we’ll get sales coming in.”

Lucas was speaking just days after signing the first of these contracts with a major distributor in the U.S. The distributor is already connecting Scene Sharp to customers in major market channels such as defence and intelligence, oil and gas, marine, emergency response and agriculture.

The company is now focused on software that can enhance the colour of images taken from satellites, which means they are far more effective in detecting, say, changes in a crop in agricultural analysis.

Lucas added that the great thing about these connections is that they lead to early adopters of the product. Whether or not these are initially paying customers, they provide feedback on Scene Sharp’s product to help it improve the functionality and find the most attractive niches.

“It’s all about understanding whether your product is minimally viable to the extent that people will pay for it,” he said.

Scene Sharp now has about 100 potential customers in its funnel — a trade term for potential customers it is now talking to — and aims to have 20 distribution agreements signed by the end of the year.

The company, which now has nine employees, is close to closing a round of funding, though Lucas declined to say how much it had raised. He said the company will begin working on a more substantial funding round late in the year, once it has a more established revenue stream to show investors.

Scene Sharp first gained public recognition when it won $145,000 in cash and in-kind services at the New Brunswick Innovation Foundation’s Breakthru competition in the spring of 2011. Scene Sharp’s prize included a $100,000 investment from NBIF, and a private investor also came in with a $50,000 equity investment. The company raised about $300,000 from angel investors in October 2012.

Jutla: New Paradigms Merit Bold Moves


A technology start-up “gold rush” is in progress worldwide with no signs of slowing, and Atlantic Canada is showing it has the educated resources and energy to pan for this gold too.

According to the latest Entrevestor Intelligence report, 153 startups started in AC in the last three years and almost 70% of them are in the IT sector.  This phenomenon is hardly surprising given that IT startups require relatively low investment and offer the potential for attractive returns. Those are perfect ingredients in a region not known for high capital investment.

As a vehicle for economic growth, the IT startup is almost incomparable in terms of quickly developing a scalable and profitable product. Indeed, investor understanding of technology platforms is attracting external investment to the region’s start-ups. The attitude of these investors is so significant that it deserves a closer look.

Driven by R&D and business visionaries, the IT-based paradigm showed up on a large scale in the 1990s. The agile methodology for managing software products came along in 1995. Then in 2000, the market grew for multi-sided platforms, which connect different markets or customer groups, such as advertisers and searchers (Google), or job seekers and recruiters (Monster). The IT-based paradigm grew quickly because software companies could gain huge returns without spending much to service new customers, unlike product-manufacturing companies.

What’s more, these business models possess strong positive, cross-side, and/or same-side network effects. That is, users benefit from -- and are willing to pay for -- the presence of other users on the platform.  Advertisers pay more to affiliate with platforms with more users. That means even in the free model, users are willing to “pay” by giving up their personal data for platform affiliation. The stronger the network effects, the faster a platform-based company scales. Such companies race to acquire customers, and retain them through continually offering innovative new services, and attracting new customer groups.

In this environment, it has never been easier in the history of Atlantic Canada for IT companies to acquire startup investment. And we can make it easier yet by ensuring more IT startups and investments succeed. To that end, various institutions are contributing to a loose-but-shared regional platform, connecting investors, mentors, entrepreneurs, community colleges, universities, government, and industry. Several individual organizations in some of these groups have not yet figured out that they are participants on a common platform, but good government is driving them in a direction of closer teamwork and citizenship.

Atlantic Canada now needs more infrastructure to capitalize on business and IT paradigm shifts. The big shift recently has been the development in which startups have gone mainstream. The agile model we mentioned earlier is now being taken on by software engineers to develop successful business models. Described by Eric Ries in 2011, the lean entrepreneurship methodology is an attempt to increase business model success across startups regardless of the sector. But make no mistake, for the IT sector lean entrepreneurship is fully dependent on software development to help prove a business model.

Moreover, the majority of the sector’s business models are for multi-sided platforms. Thus we must call for our regional stakeholders to invest more heavily in more thoughtful, deliberate, and purposeful IT infrastructure to allow our companies to create platform prototypes more quickly so that they can successfully prove their business models with paying customers.

Volta recently partnered with Amazon to provide Halifax startups with discounted access to cloud and big data services.  These services represent just one example of a building block of IT infrastructure that allows for fast experimentation. Such IT infrastructure not only accelerates product development; it helps their survival rates of the companies themselves. When a company has to spend its limited resources on proprietary technologies versus common-to-everybody technologies, it’s more likely to run out of money before it gets to market.  We are much too slowly putting in the IT infrastructure that provide complementary building blocks for IT startup success in our community colleges, universities and regional incubators. Universities can make it easier for startups by providing IT building blocks.

Atlantic Canada can win through deliberate, purposeful actions to provide, coordinate, and maintain consumable IT building blocks (e.g. identity management, OpenStack API extensions for common tasks, common algorithm implementations, etc.), for its startups. This should take place in conjunction with increasing business entrepreneurship and greater political will.

We are at a critical point in which investing big in repeatable building blocks will empower Atlantic Canada's IT sector to write a new chapter in our economic history. We want to end the paradigm in which one-in-ten businesses succeed and replace it with one in which a broad range of startups prosper.

 

Dawn Jutla is a professor in the Masters of Technology, Entrepreneurship and Innovation Program at the Sobey School of Business, Saint Mary’s University.

 

Press Release: Venn Launches


Venn Innovation, the Moncton-based tech support organization, issued the following press release this week:

Venn Vision and Programs Launched

For immediate release:

Moncton, New Brunswick (May 20, 2014) – Today, Venn Innovation Inc., formerly Tech South East, announced its new name and refined program offering.  As New Brunswick’s innovative ecosystem evolves at a rapid pace, so must the organizations that operate within it.  Within this innovative ecosystem, Venn will help tech companies grow and succeed.

 “We are very proud of our record of success over the past four years,” said Venn President and CEO Doug Robertson, “and more importantly, of the growth and dynamism of the excellent companies and individuals we work with.”  In conjunction with the rebranding, the company undertook extensive consultations with members and stakeholders across the province. “The evolution of the innovation ecosystem in the province, including the role played by many organizations in helping companies at various stages of growth, made it essential we position Venn to deliver unique, high value programs for the companies”, added Robertson.  “Our consultations provided solid feedback on the services our member companies value most and ways for us to enhance the value we can deliver to them.”

Venn: Empowering Innovation

Whether a company in New Brunswick is in the early stages of growth, working to strengthen and diversify its markets, or scale operations to the next level, Venn has a refined service and program offering designed to assist.  Particular focus will be placed on businesses in early stages of growth, as well as those companies working to strengthen and diversify their markets, or scaling operations to the next level.  Priority is being placed on the early stage of business development through career preparation of our youth and developing young entrepreneurs.  As well, the priority will be on those companies that are growing their business, be it by expanding their markets, getting export ready or increasing production.  Through its extensive network of regional, national and international partners, Venn will provide its members with access to strategic connections and collaborations needed to empower innovation and support their growth. “Today’s launch of the Venn brand is an important first step”, said Venn Chairman Paul Gunn. “In the coming weeks the company will start to introduce its new programs and in June will open the new innovation centre.”

Speaking on behalf of the provincial government, Economic Development Minister Bruce Fitch said “The government’s innovation agenda will help prepare today’s youth for careers in the innovative economy right here at home in New Brunswick. We are working with strong partners like Venn to support the development of our priority sectors and the growth of competitive, export-oriented technology-based companies.”  He added “On behalf of Premier Alward and the government, I want to congratulate the whole team at Venn on this exciting announcement.”

Contacts / Information:

Douglas Robertson

President & CEO

T 506 857 3074

Doug@Venncentre.ca

Background

Tech South East, an innovation intermediary supporting the growth and development of technology-based companies, was formed in 2010.  Based on four years of operation and a consultative process, it has rebranded and will operate under the name Venn Innovation Inc. effective immediately. The move signals an important step as the company strengthens its role and mandate within the emerging innovation ecosystem in New Brunswick.  Since its founding, the company has grown to represent over 100 member companies and partner organizations, and its programs and activities have offered more than 300 touch points for companies and entrepreneurs.

Venn offers services to tech companies in sectors such as ICT, bio and life sciences, and clean energy.  It will provide companies across New Brunswick with access to quality professional development programming, world class mentoring and advisory services, talent and capital, and connections. 

Kickstarting Talent

For a business to grow and succeed, they need access to the right talent. Venn works to better connect our youth with career opportunities and help foster a new generation of tech entrepreneurs.

Scaling Innovation

Companies work tirelessly to validate their ideas, understand their customers, and develop their products. Venn helps them access great information, experience, and resources to enter new markets and grow their business.

Powered by Networks

As a company enters new markets, it needs to expand its reach and access an ever-broader pool of resources and contacts. Venn’s network of regional, national and international partners provides them with the strategic connections and collaborations to bring their company to the next level.

Congrats to Startup Canada Winners


Congrats to all the winners  of the Startup Canada Atlantic Awards, which were presented last night at a reception at Dalhousie University.

It was a rousing affair, deftly hosted by Rivers Corbett, the Fredericton-based  owner of the Relish Gourmet Burgers chain. Victoria Lennox, who founded Startup Canada less than three years ago, was in town to fly the flag for the volunteer-group that organizes startup communities across the country.

Gerry Pond, who claimed the Wolf Blass Lifetime Achievement Award, received a standing ovation for his years of service to the community, and for his witty repartee with Corbett.

Many thanks to everyone who showed such kindness at the reception and over social media in congratulating me on winning the Media Person of the Year. It means a lot.

The winners of the Atlantic Awards will now be considered for the national awards, which will be handed out at a gala event at the CN Tower in Toronto on June 12. You can help to influence the judging panel by voting for the national winner here.

My congrats go out to the other Atlantic Canadians named by the national startup organization:

 

Entrepreneurial Effect Award --  Clarity.fm

 

Startup Community of the Year --  Startup Fredericton

 

Most Entrepreneurial Post-Secondary Institution of the Year -- University of New Brunswick

 

Professional Services Company of the Year -- McInnes Cooper

 

Incubator / Accelerator of the Year -- Launch 36

 

Non-Profit Support Organization of the Year -- Hub Halifax

 

Entrepreneurship Ecosystem Builder of the Year -- Robert Pelley

 

Entrepreneur Mentor of the Year -- Robert Zed

 

Entrepreneurship Educator of the Year -- Dr. Mary Kilfoil

 

Wolf Blass Lifetime Achievement Award -- Gerry Pond

How Verafin Won $60M from Spectrum


When Spectrum Equity managing director Chris Mitchell flew into St. John’s to meet Verafin  two-and-a-half years ago, both parties noticed something in the other that they liked.

Mitchell and his team from the Boston and Menlo Park, Calif., private equity firm found a company with a remarkably open and innovative culture. And the execs from Verafin, which develops software that battles money laundering and fraud, learned that Spectrum understood their market like few other investors.

The relationship grew and culminated Thursday when Spectrum announced a $60-million investment in Verafin — probably the largest investment ever in an Atlantic Canadian startup. It is a deal that will finance the next phase of growth for Verafin and also has vast implications for the startup community in Newfoundland and Labrador and across the region.

 “Of all the private equity firms we spoke to, they knew the space more than anyone else,” said Verafin CEO Jamie King in an interview after the deal was announced.

King said his company has already benefited from its relationship with Spectrum because it has made introductions that have helped immeasurably.

Spectrum has invested in such financial services-related tech companies as InterbankFX, Mortgagebot and Ipay Technologies, and has been using its connections to aid Verafin. King said Verafin had identified eight private equity firms as possible funders and chose Spectrum after extensive internal deliberation.

The reason that Spectrum, which has raised $4.7 billion for investment in information technology and media companies and has more than 50 portfolio companies, took such an interest in Verafin is its clear success and its culture. Verafin has about 1,100 clients, mainly North American banks. Its revenues are increasing 50 per cent annually and will reach about $30 million this year.

But behind the numbers is a company with an intriguing wide open culture — surprisingly so, given that its products thwart organized crime. King and his co-founders believe they can succeed only if they create a culture where innovation thrives and employees’ creativity produces a constant stream of new products.

When the Spectrum team first visited St. John’s in late 2011, King made sure it met not only with the company’s senior managers but also the next level of managers. He says Spectrum saw what an open and vibrant company it was and was impressed.

People familiar with the deal said some of the funding will be used by Verafin for growth capital, while the rest is buying out early investors. King said the company, which has about 200 employees, will use the money to hire as many as 150 people in the next two to three years. They will mostly be sales people and software engineers in Newfoundland and Labrador.

 “We are committed to providing the most innovative products possible to our customers, and these are products you can let go and not constantly update.”

Verafin will continue to focus its business on American and Canadian lenders, but King said it could in time spread out into other financial industries, such as brokerages and insurance. He added that once again, Spectrum’s connections will help it push into these new markets.

Profile: Championing PEI Biotech


Rory Francis’s voice crackled with enthusiasm as he spoke by phone from Charlottetown. “We’re defying gravity here,” said the executive director of the Prince Edward Island BioAlliance as he revealed that, after a decade of careful nurturing, the life sciences sector on the Island is becoming an increasingly significant contributor to the economy.

The BioAlliance has recently completed its first economic impact audit of the Island’s life sciences sector and the evidence shows rapid growth.

 “We have 39 companies bringing in $150 million in sales,” Francis said. “The life sciences sector is now providing 2.9 per cent of GDP (compared to 10 per cent of GDP for P.E.I.’s biggest industry, agri-food). The life sciences sector has only been around for a decade, but we’ve averaged a revenue growth rate of over 30 per cent over the last few years.”

Growth has been achieved largely by focusing on developing segments such as natural health products and animal medicine — sectors that hearken back to the Island’s historic expertise in agriculture.

 “Developing these sectors is less expensive in the sense that it’s a shorter time to market,” Francis explained. “We work in the food-to-pharmaceutical continuum, but the pharmaceutical sector takes huge money and many years of development. We have a few companies in that space, but they will need big brothers to come and finance them getting to market.”

The sector has seen some very big successes, with companies such as BioVectra and Novartis now bringing in tens of millions in revenues.

Francis said the focused approach among the members of the non-profit BioAlliance network has been key to success. The network consists of businesses, academic and research organizations and government agencies who work collaboratively to grow the sector.

 “From Day 1 we’ve used our small size to our advantage by using the relationships we have to work together in an economic development role,” said Francis, who has been executive director since 2004.

 “We do collaborative due diligence to see if a company is a good investment. We know what each company needs. It’s not a fill-in-the-box process; we listen first. The companies don’t have to figure out which doors to knock on. We take that stress out of the process.

 “We have to provide an ecosystem that allows companies to choose P.E.I. as the place they want to develop their companies,” he continued. “We’re always answering the question: ‘Why P.E.I.?’ because good companies and good technology can be wherever they want.”

The focus on life sciences began in 1997 when Francis, then deputy minister of agriculture, started a life sciences research group to consider how to better use the sector’s assets. Growth has accelerated during the last 10 years as the members of the alliance have honed their processes. A large new batch of companies, including Nautilus Biosciences, Island Abbey Foods and Neurodyn are now coming into their own.

Francis believes other communities would do well to create similar networks and development models.

“Across Canada we need to diversify beyond resource-based industries. In this region, the demographic shift will kill us if we don’t develop industries that will bring back the Atlantic Canada brainpower now working in other places.”

A P.E.I. native, Francis juggles many other advisory and mentoring roles, including with the Canadian Agri-Food Policy Institute, the Vineland Research and Innovation Centre and the Eastern Canada Oilseeds Development Alliance.

An avid naturalist and a geologist by training, Francis is never happier than when canoeing in “the little piece of heaven” that is Kejimkujik National Park.

He is also working with others to refocus the Island’s food sector, believing that the sector could be revitalized by novel products if Islanders use new technologies that add value and connect with their global networks. “P.E.I. has a food brand that has huge potential.”

Kira Awards Recognize LeBlanc


One of the true champions of the startup community was recognized in Fredericton last night when Nicole LeBlanc, CFO of the New Brunswick Innovation Foundation, received the Special Recognition award at the Knowledge Industry Recognition and Achievement Awards.

The Kira Awards each year bring together a broad range of people in the New Brunswick knowledge industries, and startups as you’d expect play a huge role in the celebration.

In selecting LeBlanc for the special recognition, the Kira judges chose someone who defies every cliché about accountants. Certainly LeBlanc uses her bean-counting brilliance to manage the books of NBIF, but she’s known throughout the region as one of its finest mentors because of her vast range of talents.

LeBlanc brings a keen understanding of financing to her role as mentor, but more than that she brings a great understanding of the market and technology to the task. Her ability to work with and inspire people is tremendous.

One final attribute is LeBlanc’s pan-regional perspective. When her husband Philip  -- who I had the pleasure of meeting at UNB on Monday – was studying at NSCAD University in Halifax, she worked with the First Angel Network. She’s at home in both the New Brunswick and Nova Scotia communities, and works effortlessly with startups from across the region.

The Kiras recognized some of Atlantic Canada’s leading startups. Fresh from the announcement of its $3.9 million funding round, Smart Skin Technologies of Fredericton won the Kira in the Tech Advancement -- Private category. The other nominees were SHIFT Energy of Saint John and Ara Labs Security of Fredericton.

Ara Labs captured the Most Promising Startup award, edging out FoodTender.com of Shediac and Xiplinx of Saint John. The leading exporter was Fredericton-based LuminUltra, which provides microbiological biotechnology and IT solutions. The other nominees were Smart Skin and IronFlow Technologies of Dieppe.  

Press Release: UNB’s Big Data Chair


Cisco on Thursday unveiled the Cisco Chair in Big Data at the University of New Brunswick. The following is a blog from Mike Anstey, Vice President, Sales for Business Markets at Cisco Canada, announcing the new post:

A few years ago we announced a $2 million endowment to establish a Cisco Chair in Advanced Learning Technologies at the University of New Brunswick (UNB). One of the first of our many announcements with Canadian universities over the last three years, our agreement with UNB has always reflected its commitment to being one of the country’s premier institutions for innovation in technology.

And today I had the privilege of representing Cisco as we entered the next stage of our journey with UNB.

This afternoon Dr. Monica Wachowicz was named the Cisco Chair in Big Data at UNB, a milestone which marks a cornerstone in the strategic relationship between Cisco and the University of New Brunswick.

As many readers of our blog know, Cisco has a strong history of working with education in Canada, including chairs and technology initiatives, because we strongly believe it is necessary to stimulate innovation in the country. UNB and Cisco share a dedication to fostering innovation and it’s this mutual vision that has led to today’s announcement.

You may ask why a Chair in Advance Learning became a Chair in Big Data, and that’s an excellent question.

The answer is simple. Together, Cisco and UNB worked together to refine our original agreement in order to maximize the potential for this Chair. We decided Big Data presented a richer and more rewarding area for research.

Why? Because organizations mine vast stores of data for insights that can help identify trends, predict behavior, and empower decision makers. The increase in this type of information – collectively coined Big Data – is largely due to the increasing number of people, businesses, and devices connected to the Internet.

It’s what we at Cisco call the Internet of Everything: connecting the previously unconnected and bringing together people, process, data, and things to make networked connections more relevant and valuable than ever before.

With this unheralded level of connectivity comes massive amounts of information. Researching, analyzing and managing that data is crucial and will inform decision making in ways that were previously unimagined.

As Cisco Chair in Big Data Dr. Wachowicz will promote, support, and lead innovation at the university through industry-linked projects, establish and lead research and innovation in the application of technology to Big Data and lead in the development of an institutional strategy to ensure that UNB is a world leader in the application of technology to implement a Big Data vision and related strategies.

The work done at UNB in Big Data will serve as a valuable resource to Cisco and our partners. It demonstrates UNB’s determination to use technology for positive impact on our lives and will continue to cement UNB’s reputation as a leading innovator.

I extend my congratulations again to Dr. Wachowicz and the University of New Brunswick.

Spectrum Invests $60M in Verafin


Verafin, the St. John’s company that develops software for battling money laundering and fraud, has attracted a $60 million buy-in from American private equity firm Spectrum Equity, which will finance the company’s next phase of growth.

Spectrum is buying a stake of just under 50 percent of the company. It may be the largest institutional investment ever in an Atlantic Canadian startup, exceeding Northwater Capital’s $30 million funding of Unique Solutions in the summer of 2011.

Based in Boston and Silicon Valley, Spectrum has raised $4.7 billion for investment in IT and media companies, and now has more than 50 portfolio companies including AMC Entertainment, SurveyMonkey and Ancestry.com. 

"We have long been impressed by Verafin's commitment to developing innovative risk analytics and to harnessing these efforts in a solution that is both state of the art and easy to deploy," Chris Mitchell, Managing Director at Spectrum Equity, said in a statement.

People familiar with the deal said some of the payment will be used as growth capital for the company, and the remainder with buy out early investors, including St. John’s-based Killick Capital. Headed by Mark Dobbin, Killick is one of the region’s leading private investment funds and first invested in the company in Verafin in 2007.

Verafin was incubated at the Genesis Centre at Memorial University of Newfoundland and developed world-class software for detecting and preventing money laundering and fraud. Its client-base is concentrated in mid-sized financial institutions – a massive market given that there are now almost 7,000 commercial banks in the U.S. alone.

The company has been growing strongly for several years. Its citation in the Deloitte Technology Fast 50 (the 50 fastest-growing tech companies in Canada) in 2012 revealed its revenues had grown 358% in the five years to 2011. In March 2013, the company added the 1,000th financial institution to its list of clients.

It now has 200 employees, and it expects its revenues this year will increase 50 percent to $30 million, CEO Jamie King said in a speech at Memorial last week. And it definitely solves huge pain as debit fraud losses could reach $20 billion by 2015 and organized crime is estimated to launder $1.6 trillion annually.

The company frequently learns of its software being used to catch people engaging not only in white collar crime but also drug trafficking, elder abuse and human trafficking – news that King says invigorates his entire staff.

"Financial institutions are facing ever increasing fraud threats and compliance mandates from regulators, and Verafin is committed to providing our customers with the best software solutions to allow them to effectively fight financial crime," said King in the statement.

In September 2009, RBC Venture Partners, the VC arm of Royal Bank of Canada, led a $5.5 million investment round in Verafin. The other participants in that round were Killick and the founding investor in the company, Jamfin Inc. RBC Capital Markets acted as exclusive placement agent for the latest financing.

“Verafin has been a great company to be associated with, both in their product and their approach to management,” said Dobbin in a recent interview. “I’ve learned more from being on their board than from working with any other company I’ve been associated with.”

Dobbin’s other investments include Celtx, which makes software for the film industry, and MAX, a group of recreation and arts centres in Newfoundland. He said he will use the proceeds of the sale of his Verafin stake to Spectrum to “selectively and cautiously” seek new opportunity. The coming investments could include follow-on investments in companies now in his portfolio, and will likely include other Atlantic Canadian companies.

 

Foursum, Puma Launch Partnership


If you can drive a golf ball 10 miles by Canada Day, Foursum and Puma have a hat — and a mobile phone app — for you.

Foursum is a Moncton startup that has developed an app for golfers. On Tuesday, it launched its partnership with Puma, the German sports equipment maker whose Cobra Golf unit, based in Carlsbad, Calif., makes one of the world’s most popular drivers.

In celebration of the partnership, Foursum and Puma have announced their Go Looooong challenge, which is seeing how many golfers can drive the ball a total of 10 miles from the tee (and log the distances into their Foursum account) by the end of June. The first 150 entrants to do so will win a limited-edition Cobra golf hat.

“You’d have to average about eight rounds over six weeks, so it’s very doable,” Foursum CEO Matt Eldridge said in a phone interview Tuesday. “It wasn’t about making it a stretch to achieve. We just wanted to show the start of our partnership and some of the great ideas that we have.”

The Puma deal is the biggest announcement yet from Foursum. The company began two years ago when startup veterans Eldridge and Adam MacDonald and golf pro Louis Melanson teamed up to produce an app that can help golfers improve their score and enhance their enjoyment of the game. The app can be downloaded free from foursum.com.

Foursum has a databank of 26,000 golf courses, including maps, global positioning system locations and details of each hole. The app lets golfers input statistics from each hole, so they end up with personalized data and a graphic presentation of the strengths and weaknesses of their game.

The data — such as fairways hit and length of drive — can be instantly shared with an instructor to help golfers identify the parts of their game that need improvement. They can share the stats with friends over Foursum’s social network, even form league tables to compete with other golfers.

Eldridge said the deal with Puma is “all about customer acquisition” — that is, using the Puma name and network to drive customers to the Foursum site. The partners are now getting the news out to the golf media, and pro golfers sponsored by Puma will soon be tweeting promotions to their followers. The Puma team includes such players as Ian Poulter, Greg Norman and Rickie Fowler, identified by 70 per cent of junior golfers as their favourite player.

Eldridge said the company beta-tested the product with about 10,000 people, and this spring launched the app. It now has more than 15,000 customers, and the number is growing. So far, they are using the app for free. In the late summer, the company plans to introduce a revenue model that Eldridge describes as unique. He declined to reveal more about it.

Working with Puma, the Foursum team hopes to grow the product in Australia, New Zealand and Asia as the Southern Hemisphere enters summer.

“Opening up those other countries is big, and by the time we roll around to the spring of next year (in North America), we’ll be in a very healthy position,” Eldridge said.

“This, for us, is about helping to grow the game, which Puma wants to do as well. For us and for Puma, this is the start of something much bigger.”

Industrial Internet Blooms in NB


When McRock Capital hosts its annual Industrial Internet of Things symposium in Montreal in June, three of the presenting startups will be from Atlantic Canada.

As of March, the Toronto-based venture capital group had selected 10 startups to appear at its event – one of the world’s leading conferences for this new technological sector. And they included Eigen Innovations of Fredericton, RtTech Software of Moncton, and Streamlyne Technologies of Dartmouth.

The fact that 30 percent of the companies (as of press time) presenting at the event hail from this region demonstrates quite clearly that something is happening in Eastern Canada in this explosive economic sector.  It’s a fact that’s not lost on the McRock founders.

“We are seeing a number of innovative Industrial Internet companies based in New Brunswick,” said Co-Founder Scott MacDonald. “They all have slightly different markets so I’m cautious to declare the region as developing a particular focus. The reality is that these companies are building off local expertise in areas like advanced manufacturing.”

He said, for example, that RtTech is leveraging local manufacturing businesses into paying customers. “As a venture capitalist, that is the only validation a business has a desirable product or service offered at the right price,” said MacDonald.

In the broadest sense of the term, the Industrial Internet allows machines to communicate with one another and receive readings from sensors so that they can detect, analyze and respond to data. By receiving more data from more points than humans can process and reacting to it instantly, Industrial Internet applications can improve industrial efficiencies to an unimaginable degree.  What’s also beyond comprehension is just how big this segment will grow in the next few years.

"It took the internet 8,000 days to connect 2.5 billion people,” said Cisco in a December 2012 report cited on the McRock website. “In the next 2,900 days, 37 billion things will join the internet."

Atlantic Canada -- and New Brunswick in particular – is already active in this space, and several startups have launched in the past few years that are pioneers in this field. What they have in common is that they have done an excellent job early in their development of securing major corporate partners, which is helping them to develop quickly.

“We are just starting at the whole industrial internet of things,” said Scott Everett, CTO and Co-Founder at Eigen Innovations, which is developing industrial internet applications for food and other industries. “There is a tremendous amount of work in this space and in Atlantic Canada there is a lot of good research being done.  And in the next few years, we will see more in this field.”

The Eigen team has developed software and algorithms that take machine data and readings from sensors in real-time and automatically ensures that all the machines are continuously adjusted to a setting that optimizes the overall manufacturing process.  The company last year began to work with Portland, Ore.-based Flir Systems, the largest global provider of thermal cameras, on a system that will use thermal images as a smart sensor to detect quality defects and take action in real-time to adjust the production process. Since then, Eigen has linked up with two other industrial partners in other sectors. Down the road in Moncton, RtTech teamed up in early 2012 with Emerson Process Management, whose St. Louis-based parent has annual sales of $25 billion.  They have developed an information system to monitor and manage plants’ energy consumption in real time. Whereas many energy management systems allocate energy costs monthly, this system instantly compares usage against a theoretical benchmark, and analyzes system performance by unit, area, and across an entire plant. What’s more, the product is sold through the massive Emerson salesforce

“We’ve gone from having three sales people in the company to having hundreds of sales people all over the world,” said CEO Pablo Asiron. “It increases our reach by 100-fold and hopefully in a few months we’ll start seeing the revenue that they [Emerson] are expecting.”

Two other Fredericton companies, Smart Skin Technologies and Xiplinx, are developing processes to help beverage producers improve the efficiency of their plants. Both are now working with leading international customers.

The sector in Nova Scotia is not as advanced as in New Brunswick but a few companies are moving into the space. Streamlyne is developing a “dashboard for real-time business insights and analytics of your manufacturing operations.” And Stromline of Halifax, which has developed a tool to remotely monitor fuel levels in oil tanks, plans to work on Internet of Things applications.

The companies involved in the space all agree that there are advantages to having neighbours working on complementary technologies as this allows them to share experiences and networks.

 This article first appeared in the spring 2014 edition of Entrevestor Intelligence. You can find the full report here.

Entrevestor Dinner Marks a Beginning


Last night, we gathered in Fredericton with almost 50 members of the startup community for the first Entrevestor dinner – an event that marks a beginning on many levels.

Most important, it was the beginning of two discussions that Entrevestor will perpetuate in the coming months. First, how can we build up a more effective mentorship network for the region’s entrepreneurs? And second, can we develop a program to help Atlantic Canadian startups find early adopters?

Last night also marked the beginning of the series of Entrevestor dinners. These are gatherings of moderate size in which members of the community come together to discuss improvements to the ecosystem. We plan to have dinners similar to the Fredericton event in the autumn in St. John’s, Halifax and Charlottetown.

What was particularly gratifying last night was the level of engagement by the participants. People jumped into the discussions and there was virtually no “dead air” during the talks.

Calvin Milbury, CEO of the New Brunswick Innovation Foundation, led the discussion on mentorship and East Valley Ventures chairman Gerry Pond (shown above in this great photo by Allan Gates of Bonfire Communications) headed the talk on early adopters. We will describe these discussions on Entrevestor in coming days, and carry them forward in the coming months.

On a personal note, Carol and I would like to thank everyone who came out, especially the people who drove all the way from Halifax for the dinner. It was gratifying to see so many friends filling the room. I'd also like to thank Joanne Johnson and Chet Wesley of NBIF for helping me put together the event. 

Bluedrop Eyes Benefits of Deals


Bluedrop Performance Learning, the St. John’s-based training software company, has been ramping up revenues at its new learning networks division, while reducing administrative costs following a major acquisition last year.

Now CEO Emad Rizkalla is hoping investors notice an improvement when the company releases its financial statements for the second fiscal quarter, which ended March 31.

“This will be the first quarter where you can look at the numbers and say this should be a public company,” said Rizkalla in an interview last week. He had a relaxed air, sitting in a meeting room in the company’s stylish headquarters, a renovated century-old meat-packing plant in downtown St. John’s.

The 10-year-old company has been busy the last two years. It listed its shares on the Toronto Venture Exchange in 2012 via the acquisition of a listed company. Last November, it bought the 30-year-old competitor, Atlantis Systems Corp. of Halifax, for $1 million in cash.

Bluedrop is best known for providing training software for the military and aerospace industry, but in the past few years it has been growing a division called Bluedrop Learning Networks, which provides workforce training for small and medium-sized enterprises, or SMEs. It booked its first sale in 2011 and last year logged $3.5 million in sales.

Rizkalla said Bluedrop is now benefiting from the dual forces of the Learning Networks ramping up sales, and the restructuring work winding down in the Atlantis acquisition. In the first quarter, the acquisition and restructuring costs added $1.48 million to the company’s costs, which contributed to a pre-tax loss of $2.75 million. Revenues in the quarter were $2.04 million, down 19 per cent from the same period a year earlier.

The company has reduced duplication in Atlantis’s administrative and sales teams, while keeping its development workforce, said Rizkalla. And the employees who have been retained have found it reinvigorating to be part of a young, growing company. Bluedrop now has about 200 employees.

He’s bullish about the long-term outlook for the company in both of its main business divisions. The military and aerospace unit could be kept busy for years just in Canada, he said, due to programs such as the shipbuilding contract in Halifax.

In the Learning Networks division, Bluedrop is counting on opportunities as governments in both Canada and the U.S. develop programs for SMEs. The governments are demanding more training in such areas as improving productivity, leadership skills and computers science, but there are few educational resources available to teach these programs.

“We think that’s going to have significant legs because there’s billions being spent on both sides of the border,” said Rizkalla.

He noted that the Organization of Economic Cooperation and Development recently noted that 68 per cent of the Canadian workforce is now either under-qualified or overqualified for their current position. Canada produced the worst results in the OECD in the survey, said Rizkalla, and speaks to the drastic need for workforce training in the country.

Bluedrop’s shares have been trading near the bottom of their one-year range of nine to 18 cents. They closed Monday at 9.5 cents. The company now has a market capitalization of just under $11 million, and about 80 per cent of the stock is held by the management.

Young Firms Dominate StartupEast


When former Olympian Julia Rivard, the CEO of Halifax web design company Norex, wanted to help elite athletes raise money, she and her business partner Leah Skerry developed and launched Pursu.it, a crowdfunding site for athletes.

That was the autumn of 2012. Less than a year later, Norex incubated a second product, Hashpi.pe, which allows a unified display of hashtags across a range of social media channels. By this time, Pursu.it had become a not-for-profit, but there was a business opportunity to launch the crowdfunding engine as a separate business, which they did, calling it Swell.

Now it’s working with Dalhousie University on the development of Eyenovation, an eye-tracking software that assesses and aids children’s reading.  It’s an incredible output of products for a company whose main business is web design.

“For years we wanted this to happen, but it didn’t happen until we put a structure around it,” said Rivard in an interview, referring to the development of new products. “So we started to structure in innovation time . . . to make sure that 20 percent of our staff was working on innovation.”

Norex has been a new product factory in the past two years, with some of these products spinning out into new companies. It is really part of a trend taking place in Atlantic Canada – the trend of launching new startups.

Of the 260 or so startups now active in Atlantic Canada, 67 have been founded since Jan. 1 2013, and a further 48 were formed in 2012. One of the most striking features of the startup community today is the rapid pace at which companies are forming.

As you might expect, some of these companies are still at the two-dreamers-in-a-garage stage – teams with an idea, a bit of development work, and a lot of mentorship. But the data produced by Entrevestor’s recent survey of startups across Atlantic Canada shows that some of these rookies are making tremendous progress in their first year.

First of all, they are employing people.  The 67 companies formed in 2013 reported that they now have 104 paid positions. The companies that responded to the survey indicated they intend to hire 164 people in 2014.

Not all companies were willing to share sensitive material such as payroll data. However, of the companies formed last year, 17 shared their total payroll and eight of these had a total payroll of more than $100,000. The average payroll of those companies was $128,000.

Second, many of the companies that are just starting off already have revenue. Not everyone wanted to reveal revenue, and many of the new companies admitted – as you’d expect – that they didn’t bring in a dime in revenue last year. But 17 companies did indeed report some revenue, ranging from a few thousand dollars to $200,000. And a total of 17 companies said they either expect their first revenue in 2014 or that their sales will rise this year. For example, one company with no revenues in 2013 is forecasting sales of $3 million this year.

Third, many of the new companies have raised equity financing. They have raised at least $7.2 million in capital, of which $3.4 million was venture capital. Most of them are leveraging the investment through programs like the Atlantic Canada Opportunities Agency’s Business Development Program.

Here’s one final interesting tidbit about the Class of 2013. Of the companies formed last year that responded to the survey, 55 percent were founded by people who had been involved previously with other startups. And most of those previous startups had raised funds. What that means is that the community is establishing a critical mass of personnel with experience in launching companies, which certainly bodes well for future growth.

For Rivard, the creation of new companies goes beyond stats about fund-raising and revenue and strikes to the heart of keeping the development community in the region and involved in stellar products.

“For our team, it’s really about keeping them inspired,” said Rivard. “For young developers, if you give them a project that can shoot to the moon, they get really excited. We all do.”

 

This article appears in the Entrevestor Intelligence report, which we published last week. The complete report is available here

Profile: Stirrett Links Grads, Startups


Scott Stirrett doesn’t think every bright new graduate should join the professions. He believes many people would better serve themselves and society by becoming entrepreneurs. And he’s acting on his beliefs. The 22-year-old Dartmouth native has quit his job at Goldman Sachs in New York to co-found Venture for Canada, a not-for-profit that will connect top Canadian university graduates with Canadian startups in need of talent.

Based on the highly successful Venture for America, which has been matching American grads with U.S. startups since 2011, Venture for Canada will establish a fellowship program that will place college graduates with startups in low-cost cities to generate jobs and educate young entrepreneurs.

“Some people are meant to become entrepreneurs, but they feel pressure to take defined career paths and become bankers, consultants and doctors,” said Stirrett during a recent visit to Halifax when he met with potential investors, companies and supporters.

“Andrew Yang, founder of Venture for America, says some of these people are ‘frustrated builders,’ in both America and Canada. As many as 75 per cent of top grads go into a few lucrative and safe professions. The question is: how to make entrepreneurship more accessible?”

He said startups lack the resources to participate in highly competitive on-campus recruiting and the salaries they offer are lower — $35,000 to $40,000 — compared to maybe six figures in big companies.

“But lots of people are prepared to move for work if there’s a potential for payoff. If you can get on a rocket ship of a company and receive equity shares, the payoff can be high, even if the salary is lower.”

Entrepreneurs are also likely to support each other and become part of the startup ecosystem, leading to more growth.

Right now, Stirrett, who wrote global client communications and managed client relationships at Goldman Sachs, is working alone, but he will soon be hiring and establishing a base in Toronto, where most of his advisers and financial backers are based.

His focus is Eastern Canada and he aims to be established in three eastern cities by the end of his first year.

Applicants to Venture for Canada will have to get through a tough selection process. The initial training program will last for six weeks and be followed by two years of on-the-job training that focuses on business development, with an emphasis on marketing and sales.

“The training gives the best of business schools without the debt,” Stirrett said. “Of Venture for America’s first two cohorts, 94 per cent have been ranked in the top 10 per cent of employees by their employers. The mean size of these companies is 19, so that’s remarkable.

“In the U.S., most fellows have degrees in humanities and economics or are engineers. In Canada, where there is more of a culture of undergraduate business programs, we’ll have more business students,” he continued.

Stirrett, who is a graduate of the Halifax Grammar School, himself comes from an entrepreneurial family; his grandfather founded Acadian Seaplants and his father runs Gordon Stirrett Wealth Management.

He said that Venture for Canada is a separate legal entity from its American counterpart, but Yang is supportive and inspirational.

Contacted in the U.S., Yang said, “Young people want to build things; they just aren’t being presented with a genuine choice to do so; kudos to Scott for taking on the challenge to build Venture for Canada and help pave the path to entrepreneurship for more recent grads.”

Leaving Goldman Sachs to start Venture for Canada is a big leap, but Stirrett is looking forward to visiting universities to speak to students. Interest from startups is already running high.

“I feel I should build this,” he said. “In the next year, I’m probably going to work harder than I ever have before but it’s important to do what you feel passionate about. I’m passionate about Canadian entrepreneurship, and this region in particular.”

Startup Corner Brook May Launch Soon


The Newfoundland and Labrador tech sector hopes to develop a startup organization in Corner Brook this year, and to have its first organization in Labrador early next year.

The plans for Startup Corner Brook, Startup Labrador and other communities are part of a concerted effort to harness the brainpower in the province’s smaller communities to help build new companies. It’s also in keeping with the goal of doubling the size of the provinces information technology sector by 2025.

The province now has a $1.6 billion a year technology sector, employing about 4,000 people. It grew from about $425 million in 2004.  Ron Taylor, the CEO of the Newfoundland and Labrador Association of Technical Industries, said his association wants to double the size of the industry by 2025, which means adding about 400 jobs a year. To do that, he said, he needs entrepreneurs to establish and grow more startups.

“Growing startups is huge,” he said last week at NATI’s Knowledge Summit in St. John’s. “We need these young entrepreneurs developing companies and creating more jobs in technology.”

The Knowledge Summit was one of several events in St. John’s first Innovation Week, which included a series of events organized by StartupNL at the Common Ground co-working space, and an open house yesterday at the Genesis Centre at Memorial University.

NATI worked three years ago with Startup Canada in going out to communities throughout the province to meet with entrepreneurs and discuss the creation of startup communities. There is now a strong and active community in St. John’s and the next step is to engage entrepreneurs in the other cities.

“There’s a lot of innovative people out there, and the idea is to create a place where they can come to meet, to collaborate and to work on companies together,” said Taylor.

NATI plans to engage entrepreneurs in Corner Brook in the next few months and help them to structure an organization that meets the local needs. Taylor said it must be a grassroots body that is built up by people in the community. NATI’s role will simply be to ensure the group has the resources needed to develop the association.

He foresees the Corner Brook group getting off the ground this year and Labrador in the first half of 2015. Though Labrador does not have a large population, Taylor said he’s optimistic about the prospects because it has such a high proportion of young people. 

Paulin-Daigle’s Bitcoin Ambitions


Raphael Paulin-Daigle plans to accomplish two things next month — help Moncton attain the world’s highest acceptance rate of Bitcoin and graduate from high school.

The 17-year-old entrepreneurial wunderkind is organizing CoinCity 2014 on June 6, an event he hopes will educate people about the new electronic currency and encourage them to own some of the new currency.

Commonly known as digital currency, Bitcoin is a peer-to-peer payment system introduced as open-source software in 2009. It is a decentralized currency controlled by no central bank and can be transferred electronically between parties anywhere in the world.

Paulin-Daigle now perceives huge potential in, and vast misunderstanding about, the new currency. So the Grade 12 student is not only organizing an event to teach people about Bitcoin, he’s also formed his own consultancy to help companies accept Bitcoin payments. He already has two clients.

“I help companies integrate Bitcoin as a method of payment, but I also help them to understand issues like the taxation and accounting of Bitcoin,” said Paulin-Daigle, who has struck a relationship with an accounting firm to perform the accounting duties for his clients.

About 0.003 per cent of the global population now own Bitcoin. Pailin-Daigle hopes that following his conference one per cent of Monctonians will have at least a few cents worth of Bitcoin jingling around in their, um, cellphone.

CoinCity will feature speakers from outside the region to help explain the new phenomenon. The speakers will include Haseeb Awan, CEO and co-founder of BitAccess, an Ottawa startup that makes Bitcoin ATMs, and Michael Curry, co-founder of Vault of Satoshi, a Brantford, Ont.-based exchange that allows trading of traditional and digital currencies.

The fact these entrepreneurs are coming from Ontario for CoinCity is one indication that Paulin-Daigle should be taken seriously. Another is that he is working closely with Dan Martell, the founder and CEO of Clarity, one of the most influential entrepreneurs in the region. Martell also believes Bitcoin will be the next big thing, and is mentoring Paulin-Daigle on developing the business. They will travel together to New York next week to meet with potential clients.

They also both believe the technical expertise exists in Moncton to make the city a hub for Bitcoin-related businesses. “We have the opportunity to gain back our position in the world that we had when we had the world’s only all-fibre network,” said Martell.

Despite his age, Paulin-Daigle has already gained a following as an entrepreneur. He has started three businesses and last year sat in on the program of the Launch36 startup accelerator. He tried launching a business called ShopPulse, which helped merchants to sell surplus merchandise online. He closed the business last year and has now turned his attention to his Bitcoin consultancy.

“I strongly believe in Bitcoin,” he said. “It’s one of the biggest tech developments of the last 10 years and I believe there’s a chance for Moncton to really play a part.”

CoinCity will take place at the Delta Beausejour on June 6 from 3 to 5:30 p.m.

Martell Launches Clarity Live


Clarity, the Moncton startup that connects experts with people who need their advice, yesterday launched a new video product called Clarity Live, which lets users attend video-based seminars with some of the world’s leading experts.

Clarity Founder and CEO Dan Martell said in an interview users can join Clarity Live for $97 a month, and that will allow them to join video-seminars, which will be held six times each month. Only eight people can join each seminar live and ask the experts questions in the online Q&A session. All the sessions will be taped and can be viewed online at any time by Clarity Live subscribers.

“The cost structure is ridiculously cheap,” said Martell, just before he delivered the keynote speech at the Knowledge Summit hosted Wednesday by the Newfoundland and Labrador Association of Technical Industries. “It’s nothing compared with the $500 or whatever you would pay for a call with these experts.”

In the past two-plus years, Clarity has amassed a network of more than 30,000 experts that people can call to discuss business problems for a set per-hour price. (The price depends on the expert.) Martell said Clarity Live lets viewers benefit from other people’s questions, and requires no preparation time.

“We’re adding another layer of service to Clarity to bring in more people,” he said, adding the company would continue with its phone service.

The lineup for May and June features: Eric Ries, author of The Lean Startup; Brian Wong, Founder at Kiip; Hiten Shah, Co-Founder at KISSMetrics; Brad Feld, Co-Founder at TechStars; Mark Organ, Founder at Influitive (and previous founder at Eloqua); Justin Kan, Co-Founder at Exec and Justin.tv; Ron Gutman, Founder at HealthTap; Tim Sykes, Stock Trader and Entrepreneur; Maren Kate Donovan, Founder at Zirtual; Jeremy Schoemaker, Founder at PAR Program at ShoeMoney; Prerna Gupta, Co-Founder at Khush; and Alicia Navarro, Founder at Skimlinks.

Martell, a Moncton native who returned to his home town a few years ago after several years in Silicon Valley, formed Clarity almost as an offshoot of his own personality. He lives and breathes entrepreneurship and is rabid in the advice he dispenses on developing tech businesses. With Clarity, he’s allowing other experts to offer advice to businesses.

In December 2012, Clarity landed a $1.6 million round of investment from such noted investors as San Francisco area venture capital funds Baseline Ventures and Freestyle Capital and Mark Cuban, the flamboyant owner of the Dallas Mavericks of the NBA.

Pond to Lead Discussion at Dinner


On Monday night in Fredericton, we’ll gather to discuss an issue that doesn’t receive enough attention: what can the community do to encourage early adopters?

It’s an issue of particular interest to East Valley Venture Chairman Gerry Pond, who will lead the discussion.

As I wrote last week, we’re hosting the first Entrevestor Dinner at the Kingswood golf club in Fredericton. (Tickets for the event are available here.) Every guest is invited to join in the discussion on critical issues in developing the ecosystem. We hope it will lead to lasting improvements.

New Brunswick Innovation Foundation CEO Calvin Milbury will lead a discussion on mentorship, and Pond will take the podium for a chat about early adopters.  People from throughout the Maritimes have already signed up to come and join these discussions, and we’re looking for more participants.

One problem bedeviling Atlantic Canadian startups is the difficulty they have in finding early adopters – the first customers to test a prototype or minimum viable product. Finding such customers is essential in getting feedback during the development of the product and getting early revenues into the bank.

The problem is there are few large corporations in the region, so it’s hard for B2B companies to find local champions for their products. Governments could fill the gap, but tend to make decisions more slowly than private corporations. That can be a problem for young companies built to move quickly.

Pond will open the discussion with a brief talk on what’s at stake and what our options are in addressing the matter. After that, the audience will discuss the best way forward. Should we initiate an award or certificate recognizing early adopters? Should there be mentorship program to explain to large organizations how they can best work with startups? Do we need a register of early adopters? 

We’ll meet up on Monday, May 12, at about 3:45 at Kingswood. We’ll get under way at 4 pm sharp, with a brief summation of the data Entrevestor has collected recently on the startup community. Then Milbury will lead the mentorship discussion until 5:10 pm, at which time Pond will take the stage.

You can contribute to these discussions, which we hope will lead to lasting change in our ecosystem. You can register here. The $75 cost covers the cost of the dinner and wine. We'd like to thank NBIF for assisting us in hosting this dinner.

Please bring along your opinions. We are looking for open and spirited discussions about these subjects. If you have strong feelings about them, please join the people from across the region who plan to attend this dinner.

Adeptio’s Pivots Generates Sales


Almost a year after it pivoted to cater to business coaches, Adeptio is gaining more and more traction due to a model in which its best clients help to sell the product to other clients.

Charlottetown-based Adeptio launched in the summer of 2012, after it was incubated within Fredericton-based tech consultancy SwiftRadius. The company at that time had a hybrid product that helped consumers pursue wellness and improve productivity. People liked the product, but it was hard to draw money from this market, so CEO Chad Griffin and his team began to consider other markets.

Business coaching seemed to fit the bill.

“The pain of a business coach is made up of three things,” said Griffin in an interview last week. “How do I find more leads? How do I convert those leads into paying customers? And once I have those customers, how do I better deliver to the customer and help them get better business results?”

Business coaching, which aims to improve the effectiveness of managers and business people, has become grown rapidly into a $9 billion a year industry in the U.S. and $1 billion in Canada. But, said Griffin, few of this new breed of corporate trainers has the tools with which to attract customers or structure a meaningful and long-term program for their charges.

So Adeptio has developed a system that allows coaches to use inbound marketing to attract business. The company has struck a partnership with infusionsoft, whose software helps small businesses attract customers, to help clients produce and distribute white papers and studies that will attract notice from business people online. When people read these papers, it gives the business coach an opportunity to strike up a relationship, which could lead to a business arrangement.

It also offers a platform that coaches can sell to clients so the end-user has an online dashboard that can help him or her improve efficiency.  Adeptio charges a base rate of $97 per month, which gives an organization 10 seats. The cost structure scales up to a maximum of $495 per month, and enterprise application pricing models are also availble.

This structure means the coach can attract clients with inbound marketing services and then sell Adeptio to the people who respond. In essence, Adeptio’s clients become an adjunct sales force.

“It’s a pretty neat model,” said Griffin. “We have an active affiliate program, and we tell them, `We’re here to support your success.’ … If they introduce Adeptio into a business, there is a royalty for them as well.”

Since its pivot last June or July, the company has had increasing validation from its customers. Some 21 companies from Canada, the U.S., Britain and continental Europe are now on board and the company has more than 3,000 leads.

Griffin said the company’s revenue increased 356 percent from the fourth quarter of 2013 to the first quarter of 2014. That growth rate is continuing into the second quarter, he added.

Adeptio has also partnered with International Coaches Federation, which is the official certification body for coaches  in the U.S.

The company secured $500,000 in angel financing late in 2012, and is now hoping to raise another $500,000 by the end of the year to fund more marketing and sales. It already has a commitment to participate in the round from one existing angel investor.

 

Innovation Week Kicks of in St. John’s


Innovation Week kicked off in St. John’s yesterday with a blue chip panel dispensing advice and five young companies presenting their products at DemoCamp.

As is usually the case with startup events in St. John’s, Innovation Week is supported by a groundswell of support from the grassroots. StartupNL, which began in 2012, now has almost 250 members and many of them packed the Common Grounds co-working space for the first two events.

The first Innovation Week in St. John’s is featuring a series of events, including some aligned with established institutions like the Newfoundland and Labrador Association of Technical Industries, or NATI, and the Genesis Centre of Memorial University. The goal is to heighten the awareness and the $1.6 billion-a-year tech industry in the province.

“We talk about doubling the size of the tech sector in Newfoundland by2015, and to do that we only have to create about 400 jobs a year,” said Ron Taylor, CEO of NATI. “Innovation Week is the type of event that is going to drive that growth.”

The event began with a fireside chat from  four veterans of the startup world: Patrick Keefe, Partner at Build Ventures; Dan Martell, Founder of Clarity; Mark Kennedy, Founder of Celtx; and Gordon Freedman, Founder of Freedman and Associates.

Freedman and Associates is an Ottawa-based patent and trade-mark agency, and has an office in St. John’s staffed by Carol Ann Thomas. Freedman himself has been involved in several startups in Canada and the U.S. He offered great insights. For instance, one audience member said he was reluctant to discuss his ideas with potential funders because they might be stolen, and Freedman responded: “Ideas are actually useless. Execution is what actually makes money and you need to partner with people who can help you execute.”

In the evening, there were demonstrations by five young startups, three of which have been featured on Entrevestor before. The five entrepreneurs were:

-   Scott Stevenson of Arc Instruments. Arc has prototyped a new musical instrument that allows electronic musicians to hold something the audience can actually see, thereby enhancing the performance. (Electronic musicians now play a platform that sits flat on a table.) Stevenson said the company is working on a more “manufacturable” product, after which it plans to launch it on Kickstarter.

-  Joseph Teo of StudentFresh. The finalist in Canada’s Business Model Contest helps students find contract work within their main area of interest with local businesses. It is now launching its private beta test.

-  Keith Makse of Red Meat Games. The game maker, who previously launched Steam and Steel, is launching Cute Samarai, a free-to-play mobile game. He is launching the endless-runner-formatted game in Canada before taking it to the global market.

-  Chesley Brown of RentChek. RentCeck is low-cost property management tool for landlords, which helps perform such tasks as issuing receipts to tenants. Brown said it has several features and he is considering such functions as keeping tracks of expenses and allowing tenants to report things that need to be repaired. Brown plans to compete with other similar apps on price, charging owners of four or more units a dollar a month per unit.

-  Matthew Stenback and Adam Puddicombe of Brownie Points. The company has a customer loyalty tool for small retailers, and has developed a data analytics tool for merchants. It even has tools that allow the merchants to contact customers who haven’t visited the establishment lately and tell them what they can buy with the points they’ve amassed. The company now has 17 clients in St. John’s, 16 in Halifax and one in Ontario. 

Huge Improvements at Halifax Biomedical


Chad Munro’s demeanour had radically changed in 10 months — all of it for the better.

When we met for breakfast late last month, the CEO of Halifax Biomedical Inc. was buoyant and optimistic about the prospects for his medical device manufacturing business. He’s pleased with the Mabou-based company’s recent sales and regulatory approvals. He’s altering the structure of his business. He’s searching for funds.

It’s a marked improvement from our conversation last June. Halifax Biomed was then wondering how to proceed with its main product, the Halifax exam imaging device that allows two simultaneous X-rays to be taken from different angles. They had sold a couple of these, used for imaging the knee, but there were significant barriers to further sales.

It has since all but eradicated those barriers and sales of the device are proceeding well. What’s more, the firm has advanced far more quickly than expected with a new product focused on imaging the spine.

Though he’s a humble man, Munro made a strong case that Halifax Biomedical now occupies a unique space in Atlantic Canada because it is an ISO 13485 medical device company (read: maximum sophistication in medical devices), with regulatory approval in the U.S., Europe, Canada, and Australia. It deals with radiation and medical implants in the global market.

“We are operating at the highest level in medical devices,” said Munro, who founded the company in 2004. “We’ve been able to get to key customers that have become strong advocates for us and our products.”

The key to this newfound euphoria was two radical events in the development of the imaging product for the knee, which Munro refers to as a late-stage project. The product was selling for more than $700,000, a considerable outlay for a hospital, and usually required a $70,000 renovation to accommodate the bulky equipment. What’s more, hospitals that used the device were unable to pass the costs of using it to other funding bodies, such as the patient’s health insurer.

To tackle the first problem, the Halifax Biomed team redesigned the product so that it was smaller, cheaper and more manageable. “You don’t need a renovation — just bolt it to the floor and plug it in,” said Munro. Adios $70,000 renovation.

The smaller product also requires less in capital costs. The upfront payment dropped from $700,000-plus to about $200,000. But Halifax Biomed actually improved its margins in the transition because it is able to sell about $300,000 to $400,000 annually in products needed to operate the machine. Best of all, the American Medical Association in November approved four new billing codes so hospitals can pass these costs on to insurers, improving the economics of the business.

Meanwhile, the company had laid out a three-year time line to develop the product for imaging the spine, to be funded by a $1.9-million loan from the Atlantic Canada Opportunities Agency’s Atlantic Innovation Fund. It involves a different machine that requires different algorithms. Six months into the project, the team had already completed a minimum viable product.

Munro and his crew were 30 months ahead of schedule, so they applied for regulatory approval in the U.S. and received it in 70 days.

“We basically completed a medical diagnostic device out of an AIF-funded project two years ahead of schedule,” said Munro.

The device is to be used for post-operative diagnostics — that is, telling people whether they need spinal operations. There are four million candidates for such surgery in the U.S. each year, so the market is obviously huge.

They discovered that they couldn’t downsize this product, and the $820,000 price tag was prohibitive for most hospitals. So the company is building a mobile imaging unit. It has bought a van, which it will station in Boston. The unit with the spinal imaging system can travel between hospitals in the area to assess whether patients need procedures.

The goal is to one day have a fleet of these units in all major centres.

Halifax Biomedical is forming a subsidiary to house the spinal unit, and it is talking to four potential strategic partners about investing in the new unit. The talks are centred around a $2-million to $3-million investment for a small stake in the unit.

Meanwhile, Halifax Biomedical is also looking for about $5 million in investment from venture capital funds or strategic investors.

“We strongly believe that we have two very valuable diagnostic measurement tools that will impact the lives of a large percentage of the patient population,” said Munro.