Kitchener hoping for downtown boost with $2 million in potential grants to Communitech
City is looking to ‘supercharge’ local startup ecosystem
The City of Kitchener is hoping that $2 million in potential grants to Communitech will help to revitalize a downtown core that’s still hurting in the wake of the COVID-19 pandemic.
Councillors approved a plan Monday to allocate $500,000 a year in 2024 and 2025 to Communitech from its Economic Development Investment Fund, with another $500,000 possible in both 2026 and 2027.
The partnership, which builds on past city investments in the tech organization, requires formal approval at next week’s council meeting.
The city’s funds would support several programs on-site at the Communitech Hub, including Fierce Founders initiatives for women and non-binary entrepreneurs, boot camps and community events, and programs that will help with Communitech’s ultimate goal of incubating 450 new startups a year.
The city is looking “to supercharge the local startup ecosystem, with a particular focus on downtown Kitchener,” a report said.
It’s hoping to revive the tech sector’s presence downtown, which has suffered as pandemic-era remote and hybrid work arrangements have led to empty offices, less foot traffic, and fewer patrons for local stores and restaurants.
The disappearance of tech and other office tenants has left more than a million square feet of office space — about 27 per cent — vacant in downtown Kitchener, the city’s business development manager, Brian Bennett, told councillors.
“There was less in-person, on-site activity taking place, and that reduced the funnel of scaling companies that would otherwise locate in office space in downtown Kitchener.” City funding for in-person programming at the Communitech Hub would support startups that could help to regenerate that office pipeline, Bennett said.
Communitech’s president and chief executive officer, Chris Albinson, said this municipal investment is key in leveraging larger amounts from other levels of government.
“That foundational investment here in downtown Kitchener allows us to go to federal partners, to provincial partners, to the private sector and say … this is the place to build strong, impactful companies globally.”
Communitech has seen 325 new founders join in the past year, and Albinson said locally based companies that have come through Communitech raised almost $391 million in the last 12 months.
About 60 to 65 per cent of Communitech’s startups unfortunately don’t survive to a second year, while nationally, about 75 per cent don’t succeed, Albinson said.
Past city investments include $500,000 in 2010 to assist with Communitech’s move to the Tannery building, $1.5 million in 2016 to assist with an expansion, and $1.5 million over three years, starting in 2021, to support growth in the tech sector.
Councillors agreed that a city economic development employee should be at Communitech at least once a month to provide information to members about doing business in Kitchener.