Rare expertise
Talent gap hurting tech sector, Vidyard CEO says
KITCHENER — Sales and business development expertise for growing tech firms is so rare that one of the most promising startups in Waterloo Region has senior people flying in from both the east and west coasts of the United States.
Michael Litt, CEO and co-founder of Vidyard, was on a panel at the FuzeNation technology and music festival Thursday that had the theme Disrupters and Game Changers.
He talked a lot about the challenges facing startups in Kitchener and Waterloo.
On the plus side, there is a lot of engineering talent. On the down side, there are not a lot of sales and business development executives with experience.
“So there are strengths in one aspect of the ecosystem and massive weaknesses in others,” Litt told an audience of about 80 people, many of them young entrepreneurs working in the tech sector.
Vidyard, which employs 150 people, has a chief operating officer who flies from Portland, Maine, into Kitchener every week, and then flies home for weekends. The video analytics company’s global vice-president of sales commutes into Kitchener from Seattle, Wash. Its director of demand generation is in Denver, and its vice-president of alliances is in Boston.
“If Vidyard has to do this, then you guys are all going to have to do it unless we can build a talent ecosystem here that supports the next generation of companies,” Litt said. “I don’t know if we can do it fast enough so we need immigration reform, absolutely,” he said. “We need to make it easy for people to move.”
The FuzeNation festival, held in an industrial building on Ardelt Place, started Wednesday and ended Friday night with a concert by Kygo. The keynote speaker Thursday night was Reddit co-founder Alexis Ohanian, who visited Vidyard’s offices in downtown Kitchener for a question-and-answer session before his talk.
“We asked, ‘What does the Kitchener-Waterloo ecosystem need to continue to bolster itself ?’” Litt said. “His opinion is that we need more geeks getting rich who will invest in other geeks.”
Litt shares that philosophy. A while back Litt, fellow Vidyard founder Devon Galloway and Mike McCauley, one of the founders of BufferBox, a startup that was acquired by Google, created a $5-million fund to invest in local startups.
“We have done 42 deals now, and we need more of that,” Litt said.
Vidyard has raised nearly $70 million US from investors. Earlier this year, it moved into new offices at 8 Queen St. N., in space that formerly was part of the long-closed Goudies Department Store.
“I will tell anybody this fact, but it very rarely gets communicated, but my goal is to personally deploy $1 billion of U.S. capital in
this community,” Litt said.
Joining Litt on the panel Thursday was Steven Woods, director of engineering for Google Canada. Woods cofounded and ran several startups in Silicon Valley before returning to this area to work for Google.
He said Waterloo Region’s startup ecosystem needs a lot more venture capital.
A couple of reasonably competent techies who pitch a good idea with global potential will get funded in Silicon Valley, Woods said. Reasonably competent techies with a crazy idea get funding there, he added.
“That’s not true here,” Woods said. “It is one of the reasons people leave, it is one of the reasons people don’t come back. And we have to stop all of those things from happening.”
Woods said there are many good technology companies in the region with some traction, generating $6 million to $8 million in annual sales. But that’s where it stops.
“That never happens in Silicon Valley,” he said.
Because almost all of the startups in Silicon Valley get funded, venture capitalists are continually pushing the founders to grow and scale up.
“That doesn’t happen here as much,” Woods said.
In the past five years, more venture capital has been available to local startups, but not nearly enough, in his opinion.
“If you have an idea that is just crazy, you are not funded here, whereas in the valley you would be,” Woods said. “And I think this has hurt our growth.”