A Mohawk College software development professor says 2016 was "the biggest year in history" for Hamilton's young, emerging technology sector.

Kevin Browne, who also runs Software Hamilton, a blog and messaging/job board for local tech professionals, said the industry in Hamilton is "admittedly young."

"We're like toddlers in terms of where we are in our development," he said, whereas "Waterloo would be more in their 20s, with firms like RIM [now Blackberry] operating there for many years now."

But despite its youth, Browne feels Hamilton has reached two important milestones.

Big jobs, big money

"10 or 15 years ago we had a lot of web agencies," Browne said. "They do work for other companies." As far as Browne is concerned, companies like that are limited by how much they can grow.

June 2016 DemoCamp Bob Young

In June, 2016, at one of Hamilton's DemoCamps, (a forum for local tech innovators,) Bob Young spoke to a crowd of around 200 attendees. (Software Hamilton)

"What we're seeing more of now are product companies. They sell their own product," he said. And making your own product tends to require more advanced skills, as Browne points out.

"So the nature of the work is a little more high-end. An example of that is IBM working with Hamilton Health Sciences." He said firms like this are posting job titles like "chief data scientist."

"Jobs like these are higher-paying," said Browne.

And in accordance with those higher-paying gigs, companies that offer their own product can really rake in the cash.

"Those companies are more interesting because they scale quicker," Browne said.

One company that's scaled quickly is Cinnos, which has pulled in over $2 million in investments and made "in the millions in revenue," according to its CEO, Hussam Haroun. The product Cinnos offers is essentially a compact, affordable data centre, whose technical feasibility Haroun worked out while studying at McMaster. 

Young entrepreneurs felt they needed to leave. But a lot of students are saying they don't want to leave Hamilton. - Vanessa Cheng, The Forge

"Everything now is built on data centres," he explained, referring to many large and medium-sized companies and institutions. Because their data centres are "mission critical," as Haroun says,  "any loss of power, for example, can cost businesses millions of dollars." What Cinnos offers is a cheaper, more customized option, said Haroun, which is especially attractive to clients with a modest budget.

A tech ecosystem with the right stuff

Aside from the meteoric growth of Cinnos, there are other big success stories in the Hamilton tech world. As Browne wrote in a recent blog post on Software Hamilton, a local business called Mabel's Labels, which is not a software company but innovated a successful design for waterproof labels, was sold in January, 2016 for $12 million.

"We remain in our Hamilton location with our amazing staff team of Hamiltonians," said Julie Cole, one of Mabel's Labels' co-founders, who said they've been well-supported by local institutions like Innovation Factory and the Chamber of Commerce.

In October, a local optimization software company called VIZIYA, which has been around for roughly five years and grown at a frenetic pace, announced a tentative deal to be acquired for upwards of $44.7 million. And a start-up called iUGO, (originally called CareKit,) was sold for $2 million. iUGO was incubated in The Forge, McMaster's start-up company accelerator, and the first of its kind in Hamilton.

I moved here in 2015. And from that time we've made millions of dollars in revenue. - Hussam Haroun, CEO of Cinnos

"The fact that we had exits and funding is what makes 2016 stand out from the last few years," said Browne.

"If you talk to people in other tech ecosystems, that's how they measure themselves. It's a good metric for the size and significance of the local tech sector."

Vanessa Cheng, an employee at The Forge, said the incubator is important "because start-up companies, young entrepreneurs, felt they needed to leave. But a lot of students are saying they don't want to leave Hamilton."

Cheng says the existence of The Forge, which in two years has accumulated close to 30 regular mentors, is helping demonstrate that ambitious young people don't have to pack it in to head for the big leagues. They can build their dream and make their fortune in Hamilton.

Hammering out an identity

But does Steeltown really have the makings of a Silicon Valley? Matt Sheridan, chief inventor behind the Nix Pro Color Sensor, says no, not exactly.

"Most people agree that Silicon Valley is cool. And when a lot of people talk about wanting to build the next Silicon Valley, they're talking about that factor," he said. "They want to build a cool space."

Sheridan says Hamilton needs to build its own identity β€” something different from Silicon Valley, but just as important, and requiring equally skilled and creative people, which he believes the city has in spades.

Nix Pro Color Sensor made in Hamilton

Matt Sheridan of Nix Sensor Ltd. said that every shipped unit bears packaging saying it was proudly assembled in Hamilton. (Matthew Sheridan/Nix Sensor Ltd.)

"I think solving real problems β€” that aren't necessarily sexy β€” is cool as well," he said.

Sheridan's device precisely identifies different shades of colour, and has earned him customers from interior designers to meat sellers. The company started with "a prototype made from an upside down shot glass," and now employs 12 people and operates in 35 countries. The young entrepreneur said he "can't believe the resources existed" that helped him get this far, and now he gives back by mentoring others at Innovation Park.

"The word people are using a lot here is 'cooperation,'" said Browne, and called that team spirit an appealing part of the tech culture identity Hamilton's established so far.

"Hamilton and McMaster created an ecosystem that encouraged me to quit a very good job in Toronto and move to Hamilton," said Cinnos CEO Haroun.

"I moved here in 2015. And from that time we've made millions of dollars in revenue."

dave.beatty@cbc.ca | @dbeatty

Corrections

  • A previous version of this article called Kevin Browne an "instructor" at Mohawk, when in fact he is a professor. The story has been updated to reflect this. CBC regrets the error.
    Jan 04, 2017 11:24 AM ET
  • A previous version of this article said VIZIYA had been acquired for $21 million, but the deal has not closed yet and the total payment could be closer to $44.7 million. The story has been updated to reflect this. CBC regrets the error.
    Jan 05, 2017 3:56 PM ET