There’s no silver bullet for building a strong innovation ecosystem

By Sebastian Leck

Sebastian Leck is the managing editor of Research Money.

“We’re not behaving like an ecosystem, like an interdependent set of partners,” the new Digital Research Alliance of Canada CEO Nizar Ladak told our senior correspondent Lindsay Borthwick this month. Instead, he said the Canadian digital research infrastructure ecosystem has been driven largely by funding mechanisms, with members doing “the bare minimum to fulfill needs with the anticipation that comes around the next competition.”

Ladak hopes to change that, and he’s not alone in his ambition. After a tight federal election in September, much of our reporting this last month has touched on the quest to build systems of partners and programs that work together in virtuous, rather than vicious, cycles. Even the best-designed programs can be counter-productive if they’re working at cross-purposes with other initiatives.

A prominent, albeit arcane, example is the Scientific Research and Experimental Development (SR&ED) tax credit meant to encourage research and development spending. As reported by Mark Lowey, a new tax court ruling has defined certain government incentive programs as “government assistance,” thereby clawing back the tax credits available through the SR&ED program. Instead of incentivizing innovation, it has become needlessly complex and at odds with other government programs that ostensibly serve the same purpose.

On a more positive note, Research Money reported that Canadian startup ecosystems  performed well in Startup Genome’s global report, with Toronto-Waterloo and Montreal increasing in rankings and Calgary and Ottawa ranked among the top rising ecosystems. And the seeds of a psychedelic research system are being planted in Canada, including a recent $5-million donation to Toronto’s University Health Network.

The debate over DARPA continues, meanwhile. After a federal election where the leading parties promised DARPA-like agencies (the Liberals’ CARPA and the Conservatives’ CARA), Camille Boulet argues, quite convincingly, that DARPA succeeds not only because of its model but also “because of the ecosystem in which it lives.” Without an end-to-end review of Canada’s innovation ecosystem, efforts to replicate DARPA may deliver mixed results or fail entirely, he argues.

Indeed, even the most cutting-edge research agency may not move the needle much without the right set of incentives, cultural environment and partners in place. The challenges for innovators will be to ensure that they are both delivering projects in the short term, but also paying attention to building the right kind of ecosystem and culture for the long run.