If there was one task Atlantic Canadian businesses should focus on in 2016, what should it be?

Opinions would vary, but my answer would be stronger links between established businesses and government on the one hand and the startup community on the other.

This should be a priority because it would, in theory at least, help solve two problems: the uneven quality of startups in the region and the negligible amount of research and development carried out by developed Atlantic Canadian companies.

I’ve been talking to several people on this subject lately and it becomes clear there is still too great a gulf between the old and new economies on the East Coast.

Canada Loses Ground in Innovation

I say this because Step 1 in forming a startup is to find a problem somewhere. Step 2 is to come up with new technology that can solve the problem in a cost-effective manner, and other steps follow after that.

We have a problem with that first step.

Many, if not most, of the startups in the region come out of universities or are begun by twentysomethings. They bring energy, dedication and technical abilities. But a lot of them lack the real-world experience to completely understand problems that businesses encounter, so they never get the ideas that lead to killer applications. For that reason, some early-stage companies are based on weak ideas.

Meanwhile, Atlantic Canada has a lousy record at private-sector research and development. All four provinces rate a D-minus in the Conference Board of Canada’s report card on business enterprise R&D. That affects the productivity of the region and the ability to develop products that can find a global market.

The solution would be to develop mechanisms for private businesses to work with startups and student entrepreneurs. Given the huge proportion of the Maritime economy taken up by the public sector, it would be great for governments to get involved, as well.

This is not a new idea. One of the hallmarks of the modern economy is that many of the world’s largest and best companies want to work with startups because they view them as sources of innovation. Eigen Innovations of Fredericton this week placed third in the Cisco Innovation Grand Challenge, a global competition that helps the networking equipment giant Cisco build relationships with innovators.

Eigen Places Third at Cisco Event

And there are signs we’re making progress. Earlier this month, Louisbourg Seafoods and Startup Cape Breton jointly hosted an event called Tech Opportunities in Fisheries, the goal of which was to bring together a traditional industry and the tech community. The New Brunswick Innovation Foundation is doing more to spin startups out of established businesses.

But more needs to be done. First, startups need to join their chambers of commerce to become more prominent in the business community. There should be more events like the recent get-together in Sydney. And businesses and government should begin to assign senior people to spend time in startup hubs like Volta in Halifax or Planet Hatch in Fredericton.

The idea isn’t just to show up and be nice. It’s to discuss the problems facing the large institutions with the hope of working with the younger company to find a solution — a solution that could be sold to other organizations around the world.