OPINION | Let's face reality about Calgary's potential as a tech hub
Transforming the city from an oil-and-gas hub into a tech hub is a complicated task
This column is an opinion from Richard White, who has written extensively on Calgary's urban development.
SAIT's recent announcement about the creation of a $30-million School for Advanced Digital Technology downtown might be seen by some as a game changer in the transformation of Calgary from an oil-and-gas hub into a tech hub. But transforming the city into a tech hub is more complicated than just one building.
A tech hub is defined as a group of buildings in close proximity to various amenities that encourage networking and collaboration, resulting in numerous small technological startups growing into midsize (50 to 200 employees) and large (200-plus employee) companies, much like downtown Calgary has been a hub for the creation and growth of junior oil companies over the past 40 years.
Calgary Economic Development, the University of Calgary and various tech partners are working very hard to make Calgary an attractive destination for tech workers by fostering the development of three tech hubs in the city — in the downtown, the East Village and the University of Calgary campus.
Calgary's economic and educational leaders learned from the failed Amazon headquarters bid in 2017 that, while Calgary is a highly educated city, we lack the trained software engineers, data scientists, coders and programmers needed to convince medium to large tech firms to relocate here.
Three new hubs
SAIT's new school will graduate 1,500 trained advanced digital workers over the next five years, which should help fill some of 2,000-plus tech positions available today at over 400 growing tech companies in Calgary, as well as those created over the next five years by the projected growth in Calgary's tech sector.
The school is perfectly located within blocks of three major downtown office towers recently retrofitted to appeal to tech companies: First Tower (formerly the Telus building), Stephen Avenue Place and The Edison.
The fact that all of these buildings are near the Bow River pathway, Stephen Avenue Walk, Chinatown and Olympic Plaza Arts District gives it the amenities to make it attractive to future tech workers.
The proximity to the Seventh Avenue transit corridor and the future Green Line is also a plus.
A good tech hub is surrounded by a funky collection of cafes, bars, restaurants, live music, parks, pathways, recreation areas and residential spaces.
In the East Village, the Calgary Municipal Land Corporation (CMLC) is building a 50,000-square-foot new home for Platform Calgary in the new $80-million parkade south of the Central Library.
Platform Calgary is the new name for Calgary Technologies Inc., whose history can be traced back to 1981, when the city set up the Calgary Research & Development Authority to develop Calgary as a budding technology centre. Yes, Calgary has been trying to become a tech centre for almost 40 years.
One could ask why the CMLC built 50,000 square feet of new office space for a tech hub when downtown has millions of square feet of empty office space and three new buildings retrofitted for tech startups.
Recently, Platform Calgary announced eight companies and organizations that will become tenants at its new East Village space. And while it is great to see these companies coming to Calgary (along with the 10 firms attracted by the city's $100-million Opportunity Fund), one has to wonder how long they will stay.
Will they move once they have met the terms of their agreement with the city?
Will they be able to meet their ambitious growth goals?
The hope is their employees will love the quality of life Calgary offers and decide to stay, even if the companies move. Ideally, they will start new companies, fostering a made-in-Calgary tech hub.
The third hub is a little farther out of downtown.
In November 2018, the province transferred ownership of the 76-acre University Research Park, established in 1966 next to the University of Calgary, to the university.
Elizabeth Cannon, the president of the university at the time, stated, "this will provide an excellent platform for further innovation and company growth, create new employment opportunities, and help the economic diversification of our community through the Hunter Hub for Entrepreneurial Thinking, the Creative Destruction Lab – Rockies and Innovate Calgary."
Unfortunately, the Research Park currently has none of the amenities needed to encourage collaboration and networking.
There is no gathering place with a pub, cafe, bistro or recreation facilities, and it is definitely not pedestrian friendly. It is a sterile '70s-style business park.
Fortunately, the park was recently rebranded as "University Innovation Quarter," and the University of Calgary Innovation Quarter Trust has been established to transform the tired old park into a world-class tech hub.
What sets Calgary apart?
Enersoft is a small Calgary tech startup. The company's co-founders, Grant Sanden and Yannai Segal, think the city's quality of life is perfect for attracting tech entrepreneurs. But what they mean by that might come as a surprise.
"It is a common myth that 20-somethings are driving the tech sector growth. In reality, most entrepreneurs only develop the skills, connections and opportunities to create startups mid-career," Sanden and Segal said.
They suggest that, to attract tech entrepreneurs, Calgary "needs to continue fostering affordable suburban housing, short commutes, low taxes, clean and safe streets and parks, great neighbourhood schools, clean air and a culture of reasonable working hours."
It seems every city in the world is trying to diversify its economy by becoming a tech hub, and every college is starting a school for Advanced Digital Technology.
So their transformative idea is "to focus on making Calgary a major oil-and-gas tech hub by leveraging having some of the world's most advanced oil and gas companies in our backyard with a huge pool of skilled, smart, entrepreneurial professionals with deep insight into the problems facing this industry globally."
They think Calgary could be the leading global tech hub for finding, extracting and processing energy (oil, gas, solar, wind, geothermal, etc.) in a more efficient and environmentally friendly way.
Jordan Engbers, the CEO of Cohesic (and a veteran of Calgary's tech sector), tipped me off to the 2020 Global Startup Ecosystem Report, which ranked over 100 cities around the world based on their business startup activity. Calgary is ranked No. 52 in the Top 100 Emerging Ecosystems.
The report identifies Calgary as being in the "activation phase" of building its tech sector, with our strengths being cleantech and life sciences.
The report says cities in the activation phase must "activate entrepreneurial-minded people and grow a more connected local community and pick one or two startup subsectors that build on local economic strengths."
Like Sanden and Segal, Engbers thinks Calgary shouldn't try to be like other tech hubs.
"We can learn from them, but we shouldn't try to imitate too closely. Calgary is a unique city with its own DNA, history and people," he said.
He suggests establishing stronger links between existing oil-and-gas companies and new innovative startups, and encouraging larger energy companies to invest in startups outside of the energy domain to try to diversify their own risk.
Engbers believes Calgary has particular strengths in the health care, biotech, data management/analytics and agritech sectors.
The good news is Calgary is continuing to attract record levels of venture capital — over $200 million by the end of August 2020, which exceeded the $136 million raised during all of 2019, and places Calgary as one of the leading venture capital markets in Canada.
To be a thriving 21st century tech hub, Calgary must foster the growth of tech businesses clustered around a diversity of amenities that create a vibrant meeting place. SAIT's new School of Advanced Digital Technology, Platform Calgary and the University Research Park are three small pieces in what is still a fragmented puzzle.
There are about 270 technology startups scattered around Calgary across a diverse range of sectors. The city's goal is to grow the number of startups to more than 2,300 by 2031.
Let's hope that with some focus, collaboration and a bit of luck, we not only increase the number of startups, but also grow some existing startups into junior tech companies in the next 10 years.
I don't think we can wait 20 years.
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