Business development bank CEO fired up about local tech industry
Tec hnology entrepreneurs would represent about five per cent of our client base of 500 total clients in the Kelowna area. But we want that to be more.
Montrealer Michael Denham still remembers when his daughter was Queen Elz and his son Prince Cha.
“They’re age 20 and 18 now,” said Denham during a stop in Kelowna.
“But when they were nine and seven, they had those great names to play Club Penguin. They were hardcore players.”
Club Penguin is Kelowna’s biggest technology success story.
Started by three local men as a safe online playground for kids, the ClubPenguin.com website attracted millions of kids from around the world to play for free or have their parents pay a subscription so they could access more fun.
It also attracted the attention of Disney, which bought Club Penguin for $350 million in 2007.
Club Penguin Island is still part of Disney Interactive, which continues to have offices in Kelowna to create Club Penguin and other Disney online content.
So Denham, who is CEO of the Business Development Bank of Canada, knew Kelowna had a burgeoning tech sector before he visited here.
“Everyone had heard of Club Penguin and the Disney deal,” he said.
Denham’s trip to the Okanagan this week was two-fold.
The bank is courting tech entrepreneurs and he attended the grand opening of the bank’s new offices in the Okanagan Centre for Innovation.
The bank’s relocation to the innovation centre, from Bernard Avenue, is telling in itself.
The seven-story innovation centre, at the corner of Doyle Avenue and Ellis Street in downtown Kelowna, is a hub for tech companies of all sizes.
“Technology entrepreneurs would represent about five per cent of our client base of 500 total clients in the Kelowna area,” said Denham.
“But we want that to be more. The tech sector is robust here and rich with entrepreneurs and start ups and the bank’s expertise lies in helping entrepreneurs and start ups. Plus, we understand earlystage tech companies have no assets, so it requires a different approach.”
The Crown-corporation bank deals almost exclusively with entrepreneurs, loaning them money, making capital investments in their companies and giving them advice.
“Our interest rates (on repayment of loans) is based on risk and because startups face more risk, our rates are usually more than commercial banks,” said Denham.
“But our mandate is to support entrepreneurship, respond to the needs of entrepreneurs and be flexible with repayment. Plus, when times may be tough in the economy, the Business Development Bank is steadfast.”
The bank’s remaining business covers numerous sectors and reflects the diversity of the Okanagan economy.
The current focus on tech is a reaction to the sector’s rapid growth in the Okanagan.
The sector claims to be the biggest economic engine in the Valley, with $1.3 billion in annual sales, 700 companies, more than 7,000 workers and 15 per cent yearly growth.
“We’re very excited about Okanagan tech,” said Denham.
“It’s not as large as it is in Toronto, Vancouver or Montreal, but comparisons can be made to Ottawa, which is a much bigger city, and Halifax, which has seven universities.”
The local tech sector also feeds off higher-education institutions, UBC Okanagan and Okanagan College; is well connected to the tech powerhouses in California’s Silicon Valley and Vancouver; and attracts innovative entrepreneurs who enjoy the Okanagan lifestyle.