By Ivette Vera-Perez
Canada has declared a BHAG (Big Hairy Audacious Goal) for the clean technology sector: to capture a sizable part of the global market for cleantech. This market is expected to exceed $2.5 trillion by 2022. The goal is to triple the value of Canada’s annual exports to $20 billion per year by 2025 from $7.8 billion in 2017.
Given the relatively small size of Canada’s domestic market, strong export growth is simply a necessity. For clean technology and environmental products and services to be in the top five exports by 2025, exports will have to grow by an average of 11.4 percent per year. There are a handful of examples that prove that it can be done; Canadian cleantech companies that are very well recognized internationally such as Ballard Power Systems, Ecobee, and MineSense. Notably, all of these success stories are small- and medium-sized companies (SMEs) that are global leaders in their respective field.
But successful as they are, they are also few and far between. Cleantech startups face enormous challenges. In general, SMEs in cleantech often lack the critical access to public and private capital. Many clean technologies are capital intensive, but this capital also needs to be patient, as investments take time to reveal their true potential. Fortunately, we can see a progressive increase in size and sophistication of Canadian funds. This promises to play a role in preventing Canadian cleantech companies from migrating south of the border or being acquired by foreign firms.
A second challenge among cleantech start-ups and SMEs are barriers to accessing talent on the technical side and limited entrepreneurial, business and soft skills. Such start-ups are often founded by tech entrepreneurs with vision and expertise, but a lack of knowledge of the regulatory and policy environment results in some of these companies failing to become successful. Mitacs aims to fill a portion of this gap by helping companies bring in talent from post secondary institutions to help companies execute on their roadmaps.
With the right mix of human and financial capital and supportive institutions in place, Canada’s cleantech industry can become one of the most important areas of export growth and give our economy the boost in innovation and productivity that it needs.
Ivette Vera-Perez is the Team Lead for Mitacs’s Account Management group. She directs a multidisciplinary group of account managers across Canada, with the mandate of helping industry secure top talent to advance innovation. Ivette has over 15 years of experience in the cleantech and environmental technologies sector. Her expertise spans from business development to site engineering, operations, and financing.