KPMG, in partnership with the British Columbia Technology Industry Association (BCTIA), has just released the 2014 Technology Report Card that gauges the growth of tech in B.C.
According to the study, the technology sector in B.C. scores a solid “A” when compared to other domestic industries. At $15 billion in GDP, it is among the top three contributors to the provincial economy.
BCTIA CEO Bill Tams told Business in Vancouver in a follow up report that B.C. tech has grown an average of seven per cent annually, while the overall economy grew by 1.8 per cent in 2012 and three per cent in 2013, according to Stats Canada.
The tech job market has also swelled to 84,000 in 2014, with an average salary of $75,000, 66 per cent higher than the B.C. industrial average.
While B.C. start ups benefit from the west coast’s entrepreneurial spirit and Vancouver’s proximity to U.S. and Asian tech hubs, the lack of government incentives and a meagre venture capital environment both score the province a mediocre “C+” when compared to other provinces and international tech markets.
And B.C.’s clean technology sector has also ridden the wave of uncertain government funding and lack of access to seed capital.
According to the report, cleantech accounts for about $1.7 billion of the $23 billion of revenue the technology sector earns each year, and provides about 6,400 jobs spread across 202 companies.
Previous reports have shown that public funds for cleantech start ups in Canada already have a high barrier to entry. Sources such as the federal Sustainable Development Technology Canada fund require of applicants a commercial or strategic partner already in the works before they receive funding.
And in B.C. in particular, public funding has tended to be put on safe bets like hydro infrastructure, while slightly riskier enterprises – which in the end could yield greater innovation and profits – are left competing for what niche capital may be available.
In spite of all this, British Columbia, anchored by the tech buzz surrounding Vancouver, is positioned to be a national leader for startup technology firms, as success stories like Hootsuite and Flickr attest.
Whether clean technology or otherwise, the survival of the sector remains in the hands of smart private investors – like Version One Venture and Northleaf Venture Catalyst Fund – which are growing in B.C., while being bolstered by direct government intervention in the industry.
“What everyone forgets,” says Mike Woollatt of the Canadian Venture Capital & Private Equity Association, “is that Silicon Valley was built on government involvement and still is today.”
B.C.’s Technology Sector Passes the Grade But With Room to Improve