Why Canada needs entrepreneurial clusters, and how to go about making them – by Rick Spence (National Post – September 14, 2015)

The National Post is Canada’s second largest national paper.

Imagine you have an idea for a zillion-dollar business, but you need partners, skilled employees, industry contacts — and patient capital to build it.

In a perfect world, you could source all that with a few local calls. In this world, it happens in just a few places: Silicon Valley, New York City, London, and maybe Beijing and Tel Aviv. When the mix of entrepreneurial activity, knowledge, mentoring and funding reaches critical mass, help finds you.

Can Canadians build their own entrepreneurial clusters? That question is being explored this week in Waterloo, Ont., site of a three-day conference focusing on creating more innovation ecosystems. Waterloo Region, an hour’s drive west of Toronto, comes closest to the ideal in Canada.

Sparked by the University of Waterloo’s founding principles of industry placements and giving researchers ownership of their discoveries, the region has become home to 1,000 tech companies, as well as leading-edge science, think-tanks, and renovated co-working spaces where technology veterans and Google employees rub shoulders with ambitious startups and starry-eyed students.

But it’s not really an ecosystem, not yet. Sure, it’s home to all-star tech companies such as BlackBerry, Open Text, Dalsa and Sandvine, and to overachieving juniors such as Kik Interactive, Miovision Technologies, Desire2Learn Inc. and Thalmic Labs. But even Waterloo is struggling to build its own sources of venture capital capable of hefting local companies into the big leagues.

“An entrepreneurial cluster requires both serendipity and deliberate engineering,” said Steve Blank, a Silicon Valley entrepreneur who’s best known as a founder of the Lean Startup model. “Entrepreneurial clusters require a culture of risk-taking, and that requires risk capital. Not just angel investors, but capital that can scale. And that occurs in just a few places in the world.”

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