Toronto’s Rising Digital Star
Toronto’s Rising Digital Star
In this week’s edition of PYMNTS’ Weekly Tech Center Roundup, we take a look at Canada’s “economic powerhouse” and explore why Toronto may just be the next great tech startup creator.
Before we jump into the post, here are a few quick facts about Toronto, Canada and its tech scene:
- Estimated population was 6.2 million as of 2016.
- The city’s GDP tops $304 billion.
- Toronto is home to more than 15,000 tech companies, generating CAD$52 billion in revenues annually.
- Toronto has one of the largest concentrations of financial services in the Americas. Roughly 251,000 people are employed in this sector across the region, representing 36 percent of the country’s financial services sector employment.
- Within the Greater Toronto Area (GTA) are industry-leading fortune 500 companies, renowned universities and colleges, and local businesses ranging from startups to multi-national firms.
- There are nearly 30,000 professionals working in FinTech in Toronto.
- Innovation in the renewable energy and clean-tech industry has established Toronto as a dynamic hub of activity for the space.
PUTTING CANADIAN INNOVATION ON THE MAP
Toronto is known for a lot of things – musical artist Drake, successful professional sports teams and being one of the most multi-cultural cities in the world, just to name a few – but it also has a booming technology industry of which the world is taking notice.
“The city has all the markings of a world-class hub for technology startups and reminds me a lot of how New York City felt in the early 2000s when I moved back from the Bay Area — simmering with entrepreneurial talent, opportunity and a strong foundation to support it,” Josh Guttman, general partner at VC firm SBNY, recently explained in a piece for TechCrunch.
“I think Toronto is poised to contend as one of the biggest North American hubs for technology startup activity over the next five to 10 years.”
Guttman’s got a solid list of reasons to support that prediction.
As the fourth largest city in North America, Toronto is bustling with approximately 150,000 full-time students enrolled in universities within 90 minutes of the city’s downtown area, helping to foster a great deal of young talent in the region.
With a supportive local government behind it, Toronto’s tech scene has been encouraged to push innovation and grow with the help of grants, matching contributions and financial assistance programs and initiative to spur technological development.
Guttman also notes that having access to universal health care has also been a significant factor because it has relieved the financial burden for employers while releasing job seekers from feeling as though they have to settle for positions solely based on the benefits offered.
“But instead feel encouraged to take risks and follow an entrepreneurial path,” he added. “Without the burden of paying for health care, startups can operate more leanly and reinvest those dollars into growing their businesses.”
This vibrant and growing city is home to what Guttman describes as very creative and entrepreneurial people, setting a strong foundation for both startups and established companies to flourish.
With a slew of successful venture-backed businesses, such as Shopify, FreshBooks, and KIK, as well as a network of emerging local VCs looking to grow support for the ecosystem, Toronto is gaining a great deal of attention from the tech industry worldwide.
MAKING DIGITAL PAY OFF
In an effort to help the city’s small businesses continue down the path of going digital, Toronto Mayor John Tory announced last week that the City of Toronto will support an online business support program called Digital Main Street. Project partners supporting the effort include the Toronto Association of Business Improvement Areas (TABIA), Google Canada, MasterCard, Rogers Communications, Shopify and Yellow Pages.
“Technology has changed the demands and expectations of consumers and Toronto’s Main Street businesses require our support to help them thrive in today’s retail environment,” Tory said during the launch event. “When fewer than half of Canadian small businesses have a website, the need for this kind of service is widespread and immediate.”
Digital Main Street is designed to empower local businesses with the knowledge and skills to better adopt digital initiatives, starting with a free digital assessment. The businesses will also receive recommendations on technology partners and a “to-do list” of the steps needed to reach their digital goals.
Toronto has gained recognition for being a vibrant tech hub in the clean-tech and renewable energy space as well, so it’s no surprise that there are many startups in the city looking to make a difference in the world.
Unfortunately, as Betakit reported, there’s a stigma that just because a startup is out to make a social impact it won’t also be able to bring in money – forcing many to believe the two are mutually exclusive.
But the recent Startup City Impact: Mythbusting Mixer event aimed at changing the conversation and perception surrounding impact businesses.
When asked whether people can really make money or find a job in the social enterprise sector, Keith Ippel, founder of Spring University, had an interesting response: “Actually, that’s fair, social enterprise is dead – long live the impact economy.”