How established companies can help build the next generation of Ottawa businesses – and bolster their own bottom line
M att Whitteker says some of the best business advice he ever received came while training inside a boxing ring.
As one of the organizers of Fight for the Cure, he says he was helping DNA11 co-founder Adrian Salamunovic prepare for the popular charity boxing event.
The conversation turned to business, and Mr. Whitteker told him about his transcription and translation company, NoNotes. Mr. Salamunovic asked about his public relations strategy, and later gave Mr. Whitteker access to a database of journalists’ contact information and helped him refine a pitch that was sent to thousands of reporters.
The strategy resulted in several newspaper and radio interviews, as well as features in Fortune Magazine and on MSNBC.
“It was one of the first big PR campaigns we ever did,” Mr. Whitteker recalls.
“That conversation ( with Mr. Salamunovic) made me $20,000. I need more conversations like that,” he jokes.
Mr. Whitteker says providing tactical business advice – suggestions such as specific marketing channels – are among the most valuable contributions established companies can give to startups.
Another Ottawa entrepreneur, Jason Flick, adds that mature firms can help mentor an early stage company as it attempts to validate its ideas, develops a commercial product and makes an initial sale.
“No one wants to be your first customer,” says Mr. Flick, the co-founder and president of YOU i Labs and Flick Software.
It was with that in mind that Ottawa Technology set out to find the most important technology anchors in the city. In an unscientific survey, dozens of entrepreneurs were asked which Ottawa companies help startups get started.
The most commonly cited responses were fellow startups and companies less than a decade old. Many respondents also highlighted the contributions of incubators such as Mercury Grove, Exploriem, TheCodeFactory as well as the city-funded economic development agency Invest Ottawa.
With a few exceptions, major multinationals and large locally headquartered companies were absent.
Depending on one’s definition, the sheer size of such companies’ employee headcount could qualify them as anchor firms.
However, Mr. Flick is adamant that established companies have an active role to play in nurturing startups, and says it makes good business sense for big companies to incubate early stage firms.
Large organizations will see a better return by supporting a startup than spending the same money on R&D, he argues. Mr. Flick says a team of entrepreneurs, armed with funding and a degree of autonomy, offers a superior method for established enterprises to develop and bring new technology to market.
Startups can generally move faster and are free from the entrenched culture, biases and assumptions that can hinder innovation inside large, established companies, he says.
The Terry Matthews-backed Wesley Clover incubator in Kanata is one variation of this model. Its companies frequently fill the gaps in the product portfolios of established firms founded by Mr. Matthews, such as Mitel and March Networks.
Nevertheless, Mr. Flick says companies with an Ottawa presence can still do more.
As an example, he notes that YOU i Labs and Flick Software are located in the same Terry Fox Drive office building as Chinese networking and telecom gear firm Huawei.
Mr. Flick – who has founded half a dozen companies in the past 19 years – was working on a video conferencing app and had to travel all the way to China to make his pitch, which he said was positively received.
However, back home – where he could have perfected his app by using the video conferencing technology contained in Huawei’s Kanata offices – Mr. Flick says he was met with resistance.
“The ( Huawei) people in China want our stuff, and the people here are actually hindering us,” he says.
One local hurdle is Ottawa’s relative lack of corporate head offices. This means decision-making authority to purchase new technology, for example, is often located outside the nation’s capital.
While Mr. Flick acknowledges the challenge, he says it is no excuse. There are enough senior managers in Ottawa who can send suggestions up the corporate ladder to take a chance on promising local technology.
“They could make a difference, but choose not to. That’s what we need to change,” he says.