Conference features debate on whether future policies should focus on start-ups

For the first time, the annual RE$EARCH MONEY Conference featured a one-on-one debate between two policy heavyweights with the audience voting on the outcome. The debate focused on whether future Canadian science, technology and innovation (STI) policy should focus on start-up firms.

In favour of a start-up focused policy was Dr Adam Chowaniec, a veteran high-tech executive, entrepreneur and chairman of Startup Canada. Arguing against the proposal was Dr Richard Hawkins, a professor and Canada Research Chair in science, technology and innovation policy at the Univ of Calgary.

Chowaniec said that small- and medium-sized firms (SMEs) account for 50% of GDP and have driven the majority of economic growth in recent years — much of it through exports. He asserted that corporate Canada is "broken" as most firms such as banks and telcos operate within protected monopolies and don't have to be innovative to thrive.

"Small companies aren't protected and we're losing the best ones. Corporate Canada doesn't buy from SMEs, which is shameful," said Chowaniec. "We need to recognize and support SMEs, dismantle the monopolies and protect small companies from takeover ... We need an industrial policy and we haven't had one for 30 years."

Hawkins acknowledged that start-ups are essential for future prosperity but Canada's 1,600 large firms and 7,000 medium-sized firms produce the other 50% of Canadian GDP. These are the firms that create value from ideas and government's should have an industrial policy that stresses procurement and industry-wide innovation.

"Innovation policy oriented towards firms is wrong. It should be oriented towards industries. Governments should pick winners and not losers which is where most of our money is going now," says Hawkins. "It's not hard to pick them. Focus on the transformational aspects of pivotal industries like energy — the ones that create new markets. Look where the private money is going ... Know your market or you will fail."

Chowaniec and Hawkins agreed that Canada is in desperate need of an industrial innovation policy and comprehensive data to succeed in an increasingly competitive global environment.

Following closing arguments and questions from the floor, the vote by conference delegates produced a tie, suggesting that future STI policy needs to accommodate the needs of companies both large and small.

A complete transcript of the debate will be posted on the R$ website in the coming weeks.

R$