BRING BACK WHAT THEY LEARNED AND APPLY IT INTERNALLY.

groom acquisition targets.”

RBC is among a number of corporations working with such communities as Communitech to establish corporate innovation programs. “In that way, corporations can work with startups on things of interest to them but remain physically separated; then bring back what they learned and apply it internally,” Hill says.

There is much more than altruism at work. Companies that have engaged with startup communities are inevitably top players in their fields, notes Tawfik Hammoud, senior partner and managing director, Toronto, for Boston Consulting Group, who spoke at this month’s BDC Corporate Innovation Summit in Toronto. “Companies that do the most externally get a richer view of what is possible out there, then come back inside to do something about it. By looking out the window they know better what to focus on internally.”

Hammoud also points to the “very large” discrepancy between Canada and other jurisdictions. “U.S. corporations do four times more than Canada. We have half the amount of VC capital versus Berlin, which is ranked a secondtier city. That’s not right.”

When one considers what is happening in Waterloo, he says, or the AI advancement in Montreal and Toronto, corporations should go hard after those places. “But they need to have policies to enable the scalability of all those ideas.”

Corporations can put their money to work in three ways, he says.

They can set up a dedicated VC firm, which is not necessarily the most successful or sustainable approach for many.

They can partner with accelerators and incubators, like MaRS or DMZ or countless others in Canada. “This is becoming the fastest growing because companies can control costs and access the ecosystem for ideas and innovation.”

They can get involved with innovation labs, where activities can range from staging hackathons to building developer teams to partnerships with academia.

Hammoud points out that each industry has its own approach. “Financial services, for example, is typically focused on fintech and mobile. A chemical or manufacturing corporation might approach VC in a completely different way to make industry more efficient through robotics.”

His co-presenter, James Mawson, founder and editor in chief, Global Corporate Venturing, stressed that corporate venturing is easy to start, but not easy to do well. “The starting point is the network. You have to find way to meet these people and then decide what works. The hope is real. The challenge is equally real.”