Waterloo region's tech sector takes wait-and-see approach to Trump
Tech leaders encountering jokes of Silicon Valley colleagues moving home
Leaders in Kitchener-Waterloo's tech sector are watching cautiously to see what economic policies U.S. president-elect Donald Trump will enact once he takes office in the new year.
Trump's stunning win Tuesday night may offer an opportunity to bring Canadian workers home from Silicon Valley, but there's no rush to make quick decisions.
"Honestly, with the broader sort of impact on my business and on the Canadian economy...it wouldn't be the first time that a politician said one thing to get elected and then did something different," said Kurtis McBride, the CEO and co-founder of Miovision, a Kitchener, Ont. company with an European office in Cologne, Germany.
Miovision makes a traffic management platform used by city planners and engineers in 50 countries.
"I tend to be more pragmatic, let's take a wait-and-see approach and let's see what he actually does in the first six months in office," McBride said.
It wouldn't be the first time that a politician said one thing to get elected and then did something different.- Kurtis McBride, CEO and co-founder of Miovision
Trump criticized the North American Free Trade Agreement (NAFTA), calling it "the worst trade deal maybe ever signed anywhere," during the first presidential debate in September, and came out strongly against the Trans-Pacific Partnership, a 12-nation trade deal that would also include Canada. Trump also promised to slash corporate taxes in the U.S., from 35 per cent to 15 per cent.
On Thursday, the Nasdaq slumped as investors worried about Trump putting tariffs on exports, which could significantly hurt the tech industry, according to analysts.
"One of the first things I did was ping our CFO just to ask quick questions on the state of finance, and where the cash is being held and just to get his feel for the... situation," said Michael Litt, the CEO and co-founder of Vidyard, describing his reaction to the election results.
Vidyard is a video marketing and analytics company in Kitchener, Ont., which raised $35 million US in a Series C funding round in January.
"This is an opportunity to really and truly showcase what is going on in Canada," said Litt. "It's a great opportunity to bring some of those people home who may have already been considering it anyway."
"I think we don't really know what's going to happen until we see it happen, I think the main concern is just the instability and unpredictability," said Stephen Lake, the CEO and co-founder of Thalmic Labs, a Kitchener, Ont. company that makes wearable tech, including the Myo gesture-control armband. Earlier this year, Thalmic raised $120 million US in a series B investment round, and in September, opened a new San Francisco office.
"People across the tech industry in particular are – across the board – disappointed in this, with a very small number of exceptions," said Lake. "I guess we'll have to wait to see what happens, but at least not the result I personally was hoping for."
Lake's comments were echoed by Kik CEO Ted Livingston, which is headquartered in Waterloo, Ont. Livingston is often outspoken, but wasn't available to comment.
Yes Canada is great, but every country will have their same moment as inequality grows. This is a wake up call to make society work for all <a href="https://t.co/AwQOh2Vuwa">https://t.co/AwQOh2Vuwa</a>—@ted_livingston
Lake thinks that his company could be affected if it tries to bring in overseas workers from outside the U.S. and Canada.
"I think it will be much more likely going forward that those people would be moving to the Canadian office in Kitchener-Waterloo versus moving to the U.S., especially with the expected stance on immigration," said Lake.
Silicon Valley's Canadians
Lake, McBride and Litt all studied engineering at the University of Waterloo before going on to co-found businesses. The school is a feeder for Silicon Valley in California.
In May, the Wall Street Journal reported Waterloo's graduates are the second-most-frequently hired there, after Stanford University. All three executives have mentioned that Canadians are talking about coming home.
"A lot of jokes, interestingly enough, and I always feel that those types of jokes are somewhat couched in reality," said Litt. "I do know a few people that were considering it previously and again this might just be another piece of the puzzle that makes them consider it in a shorter time frame."
Lake was in a San Francisco restaurant on election night, and while watching CNN's coverage he saw people crying as the results became clear.
On Wednesday afternoon, the day after the election, Lake told CBC, "I've already seen this morning several different e-mail threads of expat Canadians who have relocated to California in particular over the past number of years and are quite actively today looking for advice on coming back to Canada and immigrating back with their family."
"There's 300,000 Canadians in Silicon Valley working for tech companies down there, so, even if only a handful of them decide that they don't want to wait around to see how this turns out and they want to move back to Waterloo and work for some of the great companies here, that's one outcome I could see or hope for," said McBride.
- An earlier version of the story mistakenly included China as a participant in the Trans-Pacific trade partnership treaty.Nov 11, 2016 12:02 PM ET