QUIET ASCENT
Nanaimo, B.C., on rise as tech hub
Nestled on Vancouver Island across the water from Vancouver, the city of Nanaimo has been quietly building its capacity as a hub for startups. With the help of some recent developments, it is hoping to carve out a space as a technology hub — and there are already some success stories in the making.
Nanaimo is one of the fastest-improving areas for entrepreneurs to do business in this year’s FP/CFIB city ranking — to be released Oct. 19. Each year, the Canadian Federation of Independent Business assesses urban centres across the nation to find which ones have the best environments for entrepreneurs. This year, the 83,000-strong island community saw its overall score climb significantly, ranking above the average for presence, which describes the number of small businesses in the region, and perspective, which focuses on how small businesses see the region.
Chris Davis, founder of cybersecurity startup Hyas, returned to Nanaimo from Ottawa after selling another security business to a U.S.-based firm. “We looked at Spain, France, and Austin, where I lived when I worked for Dell,” said Davis, who was born and raised in British Columbia. But Nanaimo topped his list.
“You can buy a house on the ocean here for under $1 million,” he said. With 80,000 people, it’s big enough for a Costco and other large retailers, but small enough he didn’t have to worry about the quality of schools, or gang crime, he said.
Davis formed Hyas in February to offer high-end cybersecurity services at rates small businesses could afford. Armed with friends and family funding, he built a back-end intelligence system that allowed his security appliance to better assess security threats.
Technology startups aren’t unusual in Nanaimo, said Amrit Manhas, economic development officer at the Nanaimo Economic Development Corp. (NEDC). “We’ve seen an increase in tech champions in the past two years, which in turn is increasing the opportunity for other like-minded entrepreneurs to come here and collaborate on projects and launch to market,” she said.
Before the NEDC began operating in 2012, economic development was a function of the munici- pal government, but moving to a private corporation with an arm’s length approach gave it a new lease on life, said its former CEO, Sasha Angus, who became CEO at Hyas in September.
Angus, who moved from Victoria to found the organization, was instrumental in creating SquareOne, a technology incubator the NEDC created in June 2014 in conjunction with local technology innovation and business organization Innovation Island.
“The freelancers, remote workers and entrepreneurs that occupy this space get to collaborate on ideas and this helps spark innovative startups,” said Kelsey Wolff, who manages the space.
One of SquareOne’s first tenants was Michael Reid, who along with his brother Ian hopes to take on Facebook with a new approach to connecting people online.
The pair started Red Scotch Software in January 2014, having already created a successful design firm. The software developer’s sole project is a social-networking system that lets users control their own data. Kube is a direct reaction to larger social networks such as Facebook that the brothers say play fast and free with user information.
“Almost everything done on the web is social to a certain extent,” Reid said. “We became so used to it over the years without realizing that companies abuse positions of power. It was worrisome to us. You’re expected to log in and give up your information just to get access to stuff. There has to be a better way.”
Unlike Facebook, which is a completely centralized model, Reid said Kube’s software can be hosted by anyone. Theoretically, each member could host their own version of the software. People choose what information they want to share, and who they want to see it. Sharing information involves actually sending it to other people, who then store it using their own hosted versions of the software. The Reids are about to launch a $100,000 Kickstarter campaign, drawing funding from the community.
However, opportunities for local funding are increasing. In spring 2014, a group of accredited investors formed the Capital Investment Network, which promotes investment in the region. It has organized angel investment education events, and two pitch-and-mix events designed to bring investors and entrepreneurs together. That August, the technology association for Victoria, a strong tech hub 240 kilometres away, formed the Vancouver Island Venture Acceleration (VIVA) Fund.
“It’s the first structured early stage tech fund the island has seen,” Hyas’s Angus said.
Nanaimo still has a lot to prove. But with relatively new, focused development efforts and with a burgeoning tech sector, it just might be the little region that could.