This edition of The CCI Newsletter was originally shared with CCI’s subscriber community on April 1, 2024. To receive our monthly briefing on the scale-ups shaping Canada’s future, the policies that matter, and insights you won’t find anywhere else—subscribe here.

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Dear Innovator,

On Wednesday, CCI will be publishing "Buying Ideas: Procuring Public Sector Innovation In Canada," and I'd like to invite you to a special briefing about CCI's biggest-ever policy report. Register here.

We've been talking about procurement for a long time. Seven years ago, I was publicly hopeful about an exciting new procurement vehicle called Innovative Solutions Canada. Earlier this month, I was publicly somewhat-less-hopeful when the government killed the program.

Over the years we've been consistent in saying that procurement can be a powerful way for governments to propel the growth of innovative companies. We hear from our members who sell their innovative services to governments around the world, but they struggle to win purchase orders from Canadian governments at all levels.

This dysfunction in Canadian procurement has dragged on for far too long, and at a time when governments are tightening their belts and searching for ways to operate more efficiently, serious procurement reform is long overdue.

At the start of the year, CCI designated 2024 as the Year of Procurement. We've known that this would be a major topic of conversation among CEOs and government leaders, so we've been studying the topic.

Other countries know how to do procurement better. We know this because CCI member companies tell us what it's like to sell to governments around the world. We can learn from success. This is not an intractable problem.

CCI's policy director Laurent Carbonneau has already been writing about ideas to improve Canadian government procurement. And I've been talking to CEOs about it.

On April 3, we'll be publicly releasing a comprehensive report, and hosting a conversation that includes Laurent, as well as Dr. Alexandra Greenhill, CEO of Careteam, David Helliwell, Executive Chair and Co-Founder of Thrive Health, and also Sunita Chander, Chief of Strategy, Programs and Partnerships at Supply Ontario — talking about how we can improve things.

And it won't end there. We've got plans for the Year of Procurement well past the beginning of April. And we're counting on you to help drive this conversation too. I hope you'll join us on Wednesday.

Throughout this month, I'll be in Vancouver, Edmonton, and Montréal, meeting with our members and discussing with government leaders the strategies Canada needs in order to be a prosperous country in the innovation economy. And on April 24, I'll be in Toronto for our 2nd annual Capital Markets Summit. I hope our paths cross.

Keep growing,

Benjamin Bergen

Benjamin Bergen is the President of the Council of Canadian Innovators, a national member-based organization reshaping how governments across Canada think about innovation policy, and supporting homegrown scale-ups to drive prosperity. If you are interested in learning more about the Council or joining our cause, get in touch.

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INNOVATION UPDATES

On April 16, we'll be tracking the federal budget delivered by Finance Minister Chrystia Freeland, and there may be some interesting details. In general, we're hoping the government's spending plan includes smart industrial policy, with targeted, strategic support in areas like an artificial intelligence commercialization plan, and an updated national cyber security strategy that leverages Canada's cyber industry. We will also be watching for new details about open banking, and a timeline for full implementation.

We've already seen a few pre-budget announcements, as the federal government plays the traditional game of trickling out news to maximize public attention. Innovation, Science and Industry Minister François-Philippe Champagne told Bloomberg that he's planning on tightening up rules around foreign investment of sensitive technologies like AI, quantum computing and space tech. And Prime Minister Trudeau released a whack of new policies aimed at addressing the housing crisis, including a policy to encourage banks and fintechs to take rental payments into account when calculating a customer's credit score.

The budget will come one day after Ottawa concludes consultation on the Scientific Research and Experimental Development (SR&ED) tax credit. There's still time to make your voice heard before April 15 on this critical innovation policy, and if you want to learn more about CCI's perspective on the issue, you can read our full policy brief. Earlier this month, CCI appeared on the Betakit Podcast to discuss improving SR&ED. Listen here.

At the sub-national level, nearly every province has now delivered their budget, and across the board, government spending plans have been fairly underwhelming for innovators. The theme this year seems to be a reinvestment in social services, affordability and housing. Those are all admirable goals, but as we've tried to remind politicians, without economic growth from innovation, Canada won't be able to pay for the social services we all value.

For a comprehensive overview of the 2024 federal budget and the commitments made to innovators in provincial budgets across Canada, join us on Thursday, April 18th at 1PM Eastern for our annual pan-Canadian budget season debrief. RSVP here.

Last week, CCI also hosted our Atlantic Launch & Learn event, talking about public policy and innovation in the context of the east coast. CCI Chair Jim Balsillie was in conversation with Four Eyes Financial CEO Lori Weir and ClearRisk CEO Craig Rowe. You can read more about the event and watch the video here.

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THE BIG READ

There is something incredible happening in British Columbia. In the Globe and Mail, reporter Sean Silcoff details the cluster of biotech companies that are growing fast on the west coast.

The story profiles companies like AbCellera, Clarius Mobile Health and Stemcell Technologies leading a vibrant cluster. But an important element is the collaborative relationship between the provincial government and the innovators who are leading the way. "There’s something very special happening and we definitely want to keep that going and support it,” Jobs, Economic Development and Innovation Minister Brenda Bailey says.

CCI has long said that government and industry working arm-in-arm is vital for the kind of robust innovation growth that we all seek. Read the full story here.

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THE BIG DEAL

It's felt a little bit like Miovision CEO Kurtis McBride is everywhere recently. In early March the company acquired Traffic Technology Services, less than two months after they acquired CJ Hensch & Associates.

Kurtis was also recently in Toronto Life, talking about the traffic woes of Canada's largest cities. Did you know that most large cities only adjust the timing on their traffic lights once every five to seven years?

And if that's not enough of Kurtis already, he recently penned an op-ed in The Future Economy looking at CCI's favourite topic in 2024 — procurement — and how smarter funding can lead to smarter cities.

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SCALE-UPS TO WATCH

Each month, we like to celebrate some of the Canadian technology companies that are doing incredible work.

In March, we welcomed Craig Rowe, CEO of ClearRisk, based in St. John's, NL, as a new member of CCI. ClearRisk works with risk managers and senior management from over 150 organizations all across North America in retail, property management, municipalities, technology and many others.

CCI also welcomed Geordie Rose, CEO of Sanctuary AI, based all the way on the other side of the country in Vancouver, B.C. Sanctuary is a artificial intelligence company building human-like general purpose robots. Earlier this month their robot Phoenix was on stage alongside Jensen Huang at the NVIDIA developer conference.

In March, Thrive Health Co-Founder and Executive Board Chair David Helliwell took part in a 5 Questions interview with Benjamin Bergen about healthtech and government procurement.

Here are a few other highlights from Canada's top innovators in March:

• Clarius Mobile Health named to Fast Company’s 2024 list of the World’s Most Innovative Companies
• Embark Student Foundation awards $2.7 million to seven post-secondary schools across Canada through its major grant program
• FutureFit AI CEO Hamoon Ekhtiari highlighted the benefits of AI in the workplace
• Viral Nation’s AI-Powered Brand Safety Solution won the SXSW Innovation Award
• Connect & Go CEO Dominic Gagnon was featured on the cover of Les Affaires (in a very dramatic photo) to celebrate the launch of his new book
• Sanctuary AI received investment from Accenture, to support their mission to bring AI-Powered humanoid robotics to work alongside humans

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CCI IN THE NEWS

Our advocacy on behalf of Canadian innovators has been covered by the news media this month. Here are some recent media hits:

Mark Rendell writing in The Globe and Mail on March 27, 2024, about the Bank of Canada's productivity report:

Ben Bergen, president of the Council of Canadian Innovators, said Ms. Rogers was right to highlight the problem, but her analysis was incomplete. The principal issue, he said, is that Canada does a poor job helping companies develop, retain and commercialize intellectual property. He said that Ottawa’s entire innovation strategy – how it manages research grants, industrial subsidies, trade policies and tax laws – needs to change.

“This idea that all we need to do is just throw open competition and everything will be fine, I think is the wrong diagnosis. What we actually need is complex, robust industrial strategies that lead us from idea creation, idea retention and then the selling of that idea globally through a domestically headquartered firm,” he said.

Josh Scott writing in Betakit on March 27, 2024, about the Ontario budget:

The province also outlined plans to create a $12-million Health Technology Accelerator Fund to help healthcare service providers buy and use promising new tech to improve patient care. According to the Government of Ontario, this fund will hasten the review and adoption of healthtech solutions and give innovators in the space, including Ontario companies, more opportunities to partner with healthcare players.

The new fund “likely won’t make headlines, but it represents a promising pathway for Ontario health technology companies to sell their innovative products and services into the provincial health care system,” CCI’s director of Ontario affairs, Skaidra Puodziunas, said in a statement. “This is the kind of mechanism that innovators have been asking for, and we hope that as this new program finds its footing, it can prove to be a model for more significant funding and better government procurement.”

Nick Taylor-Vaisey and Zi-Ann Lum writing in Politico on March 26, 2024, about MP Ryan Williams' recent comments about increasing competition in Canada:

"We asked Nick Schiavo, director of federal affairs for the Council of Canadian Innovators, for his take on [MP Ryan] Williams’ ideas. He applauded Williams for talking about the issue. "The fact is that we’ve seen significant pro-competition steps recently from the European Union and the United States, and we’ve also seen policies put forward by the federal government," he said.

"For a small and open economy like Canada’s, competition policy cannot be the whole solution. We need to be strategic to ensure that our most successful homegrown companies can scale and fuel Canada’s future prosperity. However, to drive a truly strong, sustainable economy, Canadian policymakers need to look deeper at the root causes of our declining productivity, poor business expenditure."

Catherine McIntyre writing in The Logic on March 18, 2024, about CCI's recommendations for SR&ED reform:

As part of the review, the federal government is considering a “patent box regime,” which offers tax breaks to encourage companies to develop and keep intellectual property in Canada.

Prompting companies to spend money on IP-generating discoveries could have an outsized impact on the economy, said Council of Canadian Innovators (CCI) president Benjamin Bergen.

"That’s where all of the value in the economy has shifted,” he said, referencing wealthy Big Tech giants like Microsoft, Apple and Google, which churn out piles of IP. “It’s not so much in their labor, but it’s actually the intellectual property that they generate, hold, and then are able to seek rents from."

Follow CCI on LinkedIn to stay on top of our latest advocacy efforts.

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DISPATCHES

Each year, Canadian governments across the country make crucial fiscal decisions for the upcoming year. As budget announcements unfold, certain themes emerge. While innovation and economic development haven't been the primary focus nationally, affordability, social services, and housing have taken precedence.

However, amidst these broader priorities, there are noteworthy developments. This month, CCI Director of Québec Affairs, Jean-François (JF) Harvey, highlighted a significant tax policy change in the Québec budget. Read his dispatch here and check out JF's comments in La Presse here.

While not all policy changes may seem attention-grabbing, as JF explains, Québec's adjustment reflects sound economic principles. It holds promise for generating increased wealth for the province.

Happy reading!