Is Vancouver a Legitimate Tech Hub?

[Pinion]

Klazu, they are essentially a cult that flouts labour laws and provides nothing of value. It's pathetic that Vancouver tries to hold them up as something positive.

[BodomReaper]

Originally Posted by csbvan

And the province announced $100 million in investments to new tech startups. Also, the government noted that the tech industry is outpacing the rest of the province in growth. I'm surprised as I didn't think that this government cared about the tech industry. Maybe they finally realized, as they mentioned today, that the industry is growing faster than the economy as a whole.

http://www.vancouversun.com/business...297/story.html

http://www.vancitybuzz.com/2015/12/b...d-investments/

It's upsetting that the government is playing venture capitalist with public money. This is no better than the sweetheart subsidies we give away to the film industry.

[Klazu]

Originally Posted by BodomReaper

It's upsetting that the government is playing venture capitalist with public money. This is no better than the sweetheart subsidies we give away to the film industry.

I am of the opposite opinion and think this is a good initiative. Tech industry is on a rise in Vancouver and we have a lot going on in here. Tech companies also pay their employees above average salaries, so this is good for the province.

I think Vancouver has a chance to become Canada's tech town, but it will need investments like this. One day it may pay big time.

Tech industry is also not as likely to move around as film industry is. In film industry it's all about single projects which can be started anywhere, but with companies based in here it is unlikely that they will move around.

[csbvan]

Originally Posted by Klazu

I am of the opposite opinion and think this is a good initiative. Tech industry is on a rise in Vancouver and we have a lot going on in here. Tech companies also pay their employees above average salaries, so this is good for the province.

I think Vancouver has a chance to become Canada's tech town, but it will need investments like this. One day it may pay big time.

Tech industry is also not as likely to move around as film industry is. In film industry it's all about single projects which can be started anywhere, but with companies based in here it is unlikely that they will move around.

I agree. Also, it makes no sense to say that the government shouldn't provide subsidies to a growing industry like high tech, but it is ok if they do the same for natural resource industries (i.e. LNG). Since the government gives subsidies to the resource industries, what is wrong with them doing the same for technology industries? Especially since, as you say Klazu, tech companies pay among the best of any industry.

[casper]

Originally Posted by csbvan

I agree. Also, it makes no sense to say that the government shouldn't provide subsidies to a growing industry like high tech, but it is ok if they do the same for natural resource industries (i.e. LNG). Since the government gives subsidies to the resource industries, what is wrong with them doing the same for technology industries? Especially since, as you say Klazu, tech companies pay among the best of any industry.

In the US the government dumps lots of money into the tech sector. It does it through the DOE and DOD. It is amazing the number of small tech companies that are developing tech for the US government.

[s211]

Originally Posted by casper

In the US the government dumps lots of money into the tech sector. It does it through the DOE and DOD. It is amazing the number of small tech companies that are developing tech for the US government.

And in Canada, the feds dump amazing amounts of money via SRED credits in anything remotely tech.

[Caliplanner1]

Originally Posted by BodomReaper

It's upsetting that the government is playing venture capitalist with public money. This is no better than the sweetheart subsidies we give away to the film industry.

LOL.......well my friend, didn't you know that in that great capitalist country the U.S.A. wealthy corporations (thrive) on generous government welfare programs (e.g. bailouts/subsidies/contracts/tax loopholes etc.). In fact, wealthy corporations in the U.S. receive more government welfare than poor single mothers/poor families.

[trofirhen]

Originally Posted by Caliplanner1

LOL.......well my friend, didn't you know that in that great capitalist country the U.S.A. wealthy corporations (thrive) on generous government welfare programs (e.g. bailouts/subsidies/contracts/tax loopholes etc.). In fact, wealthy corporations in the U.S. receive more government welfare than poor single mothers/poor families.

That stinks.

[whatnext]

Originally Posted by csbvan

I agree. Also, it makes no sense to say that the government shouldn't provide subsidies to a growing industry like high tech, but it is ok if they do the same for natural resource industries (i.e. LNG). Since the government gives subsidies to the resource industries, what is wrong with them doing the same for technology industries? Especially since, as you say Klazu, tech companies pay among the best of any industry.

I agree. And unlike natural resources tied to the land, tech jobs tend to be ephemeral. They're just one pink slip away from the next merger or takeover. if it wasn't for US Visa laws and our proximity to Seattle, how much of an industry would a city like Vancouver have?

[BodomReaper]

Originally Posted by csbvan

I agree. Also, it makes no sense to say that the government shouldn't provide subsidies to a growing industry like high tech, but it is ok if they do the same for natural resource industries (i.e. LNG). Since the government gives subsidies to the resource industries, what is wrong with them doing the same for technology industries? Especially since, as you say Klazu, tech companies pay among the best of any industry.

LNG isn't subsidized, it does not receive the benefit of any special funding, financing, supply management, or tax credit programs. Payments to LNG terminal operators are triggered only if they closely miss emissions targets in legislation that specifically targets the LNG sector. Broad-based legislation such as the carbon tax and Environmental Act fully apply to the LNG sector, and it does not receive any special treatment vis a vis these or other regulations that apply to other industries. And of course, nor does it receive the most naked form of subsidy, an injection of public cash into private hands.

The arguments here seem to be that "other guys do it too", therefore it's fine for public money to be thrown at sectors that happen to be politically sexy or have the resources to hire good lobbyists.

BC attracted the tech sector here by taking the opposite approach of corporate welfare: exceptionally low corporate and personal income taxes that benefit everyone (and US visa caps). That's not only the more ethical + democratic approach, but we've shown with the tech sector itself that it's an incredibly successful approach.

There are thousands of funds and firms whose sole purpose it is to provide start-up capital. If it made sense to do so, they would have invested in the soon-to-be beneficiaries of this public fund. There is absolutely no market failure to correct here.

[casper]

Originally Posted by whatnext

I agree. And unlike natural resources tied to the land, tech jobs tend to be ephemeral. They're just one pink slip away from the next merger or takeover. if it wasn't for US Visa laws and our proximity to Seattle, how much of an industry would a city like Vancouver have?

Natural resources jobs are also pretty fragile. Geo-politics or demand in China, or a trade deal can easily destroy a natural resources commodity.

[SFUVancouver]

I am very okay with us benefiting from our proximity to Seattle. It's a fact: we are close to Seattle. We shouldn't wring our hands about it and wonder whether we would be an increasingly vigorous tech hub if we weren't close to Seattle, no more than we should wring our hands and worry about being an increasingly vigorous seaport if we weren't close to the coast. We are.

Now what we do with our proximity is the big question. To me, from my point of observation well outside the tech sector, we seem to be doing a pretty good job to capitalize on our proximity, not to mention the opportunity presented by our visa program.

[LeftCoaster]

Toronto bases a lot of it's financial success off its proximity and similar time zone to NYC.

It's good to capitalize on your geographic opportunities, because there is nothing you can do about the geographic disadvantages a region faces. BC should continue to exploit its proximity to Seattle/Silicon valley and it's similar time zone to California for the entertainment industry.

[Alpine]

Vancouver's startup scene has been getting a lot of press as of late: A Betakit podcast, A Globe and Mail story on NYC VC firms looking at Vancouver ventures, A HuffPo story on CommandWear, Shoes.ca as one of Canada's five startups to watch in 2016, 1QBit's "quantum computers" (you can only do classical computations with them) in BC Business, tech hubs in Mount Pleasant (Hootsuite funded) and the DTES, plus the $100 million VC fund. (Christy Clark is willing to spend billion on LNG and mining, but only $150 million on tech? I digress...) I was talking to one of my professors at school today and when I mentioned the BC Tech Fund, she said she heard on the radio that General Fusion (nuclear fusion reactors) has receiving funding through that fund.

I think startups are Vancouver's strength. The startup ecosystem is much more intimate than in Seattle, although it can't beat the Bay. With the loonie remaining low for the foreseeable future (offering incentives to both US firms expanding in Canada as well as US venture capitalists to fund Canadian ventures), a glut of office space downtown, tech hubs popping up all over the place, possible IPOs thanks to the weak loonie, and (finally!) daily YVR-SJC flights, I would say that the startup tech scene in Vancouver is nothing but promising. Especially as rents in SF and Seattle skyrocket (and I could talk at length about the political dysfunction at the local/county/state level in California and Washington that have led to this mess) but rents in Vancouver stay comparatively rock-bottom. Entry-level and new grad positions will increase in salary, definitely. Zenefits has an office here, Tableau Software is hiring, Zillow will soon open an office in Vancouver.

It's the heavy hitters, like Google and Facebook, and attracting senior management, that could be a problem. Vancouver doesn't have the critical mass of tech companies like US tech hubs do. If someone relocates to Vancouver, perhaps with his family, but the startup that recruited him folds, there aren't many blue chip tech companies around for him to go to. The startups are hot, but for blue chips that aren't Amazon or Microsoft, all we have are MDA, EA, CA Technologies (I think), Salesforce, Fortinet, then the union shops (e.g. BC Hydro, TELUS, etc.) However, for executives with families, the overheated residential property market in Vancouver could make relocation expensive. I've even heard that because property values are going up so fast, MNCs can't relocate foreign talent and as such can't commit to the amount of office space they bought, leading to 10% vacancies (an 11 year low).

Justin Trudeau and the Liberals promised to do something about Vancouver's real estate market. From remarks he made two weeks ago, I'm not so sure. Sky-high property values indirectly hamper industry and commerce. The weird thing is, some LPC MPs in Metro have pointed out that high property prices make it difficult to attract workers.

LeftCoaster if you want to prove me wrong, I'm all ears. I admit this isn't my area of expertise.

[casper]

Originally Posted by Alpine

Vancouver's startup scene has been getting a lot of press as of late: A Betakit podcast, A Globe and Mail story on NYC VC firms looking at Vancouver ventures, A HuffPo story on CommandWear, Shoes.ca as one of Canada's five startups to watch in 2016, 1QBit's "quantum computers" (you can only do classical computations with them) in BC Business, tech hubs in Mount Pleasant (Hootsuite funded) and the DTES, plus the $100 million VC fund. (Christy Clark is willing to spend billion on LNG and mining, but only $150 million on tech? I digress...) I was talking to one of my professors at school today and when I mentioned the BC Tech Fund, she said she heard on the radio that General Fusion (nuclear fusion reactors) has receiving funding through that fund.

I think startups are Vancouver's strength. The startup ecosystem is much more intimate than in Seattle, although it can't beat the Bay. With the loonie remaining low for the foreseeable future (offering incentives to both US firms expanding in Canada as well as US venture capitalists to fund Canadian ventures), a glut of office space downtown, tech hubs popping up all over the place, possible IPOs thanks to the weak loonie, and (finally!) daily YVR-SJC flights, I would say that the startup tech scene in Vancouver is nothing but promising. Especially as rents in SF and Seattle skyrocket (and I could talk at length about the political dysfunction at the local/county/state level in California and Washington that have led to this mess) but rents in Vancouver stay comparatively rock-bottom. Entry-level and new grad positions will increase in salary, definitely. Zenefits has an office here, Tableau Software is hiring, Zillow will soon open an office in Vancouver.

It's the heavy hitters, like Google and Facebook, and attracting senior management, that could be a problem. Vancouver doesn't have the critical mass of tech companies like US tech hubs do. If someone relocates to Vancouver, perhaps with his family, but the startup that recruited him folds, there aren't many blue chip tech companies around for him to go to. The startups are hot, but for blue chips that aren't Amazon or Microsoft, all we have are MDA, EA, CA Technologies (I think), Salesforce, Fortinet, then the union shops (e.g. BC Hydro, TELUS, etc.) However, for executives with families, the overheated residential property market in Vancouver could make relocation expensive. I've even heard that because property values are going up so fast, MNCs can't relocate foreign talent and as such can't commit to the amount of office space they bought, leading to 10% vacancies (an 11 year low).

Justin Trudeau and the Liberals promised to do something about Vancouver's real estate market. From remarks he made two weeks ago, I'm not so sure. Sky-high property values indirectly hamper industry and commerce. The weird thing is, some LPC MPs in Metro have pointed out that high property prices make it difficult to attract workers.

LeftCoaster if you want to prove me wrong, I'm all ears. I admit this isn't my area of expertise.

Two points:

The provincial government is not investing billions in LNG. The billions are coming from the oil companies (to the extent that it actually does come). The government is investing in LNG but it is more on back-end infrastructure (skills training for trades, roads, transmission lines, etc) and what looks like a lot of support for the local PR/advertising industry. I am all for the infrastructure expenditures. If we are creating more Journeyman trades qualified individuals it does not matter at the end of the day if they end up working in LNG or some other industry we are filling a gap and raising the skills of people in BC to. The same for improving infrastructure into the north, it is needed to support mining forestry and shipping.

The real-estate market in Vancouver is hot but if you are comparing it to places like San Francisco, San Antonio, New York or Seattle I don't think it is that far out the norm. It is likely still a pretty good deal coming to Vancouver. I think most of the complaints about Vancouver housing costs are relative to the rest of Canada. That is a concern if your trying to compete with Ottawa or Waterloo or even a place like Saskatoon. There is a role for the federal government to help make Vancouver competitive to the US but relative to the rest of Canada it just needs to let the market be the market.

Ottawa is a good example for Vancouver. Nortel grew and then self destructed. When it did a number of senior people from Nortel did their own startups. Same for Digital Corporation, JDS, Mitel, Corel. Having the big Blue Chip companies blow-up or downsize periodically is good for creating new startups that are lead by people with experience.

Recruiting tech-workers from other places, I don't think having the "Plan-B job" is going to drive decision making all that much. What will drive decision making is the ability of their spouse to also advance their career. I have some first hand experience in the Saskatoon context. It is not enough that you can create a great opportunity for that target employee, if their spouse does not see a similar opportunity in there area your stuck. That is why a highly diversified economy is the way to go.

[whatnext]

Well it won't be a legitimate tech hub if housing prices continue spiralling out of control according to the founder of Hootsuite:

....Unaffordability is emptying Vancouver of one of its most valuable assets — young people who grew up in the city and who are invested in it. As well, qualified newcomers who could bring talent, drive and vision to Vancouver are looking elsewhere. The projected closure of more than a dozen Vancouver public schools hints at the scale of the problem: Families can no longer afford to live here.

This is worrying for several reasons, chief among them that it makes it exceptionally hard to grow a business in Vancouver. I’ve experienced this firsthand, but it’s hardly unique to the technology sector. Qualified job candidates are deterred from moving to the city and great employees are leaving because they can’t afford to build a life here. Even finding a rental property in Vancouver has become a feat. Vacancy rates hover at around 0.6 per cent (worse than in Manhattan), with one-bedroom condos easily topping $2,000 a month...

This lack of affordable housing has reached a crisis point. Vancouver risks becoming an economic ghost town: a city with no viable economy, other than a service industry catering to wealthy residents and tourists. The people who give Vancouver its vitality and identity will continue leaving. The kinds of businesses offering career growth and opportunity will fold or move elsewhere. And the city will miss out on the very tech boom whose promise now seems so near.
http://business.financialpost.com/ex..._lsa=96ba-5652

Though I'd take with a grain of salt a prodevelopment message from someone who has a cozy relationshp with Vision Vancouver. You scratch my back...

[Klazu]

Hootsuite could also consider paying slightly higher wages to lure in professionals. I have been under impression that their salaries are not among the top end of the local tech scene.

[casper]

Originally Posted by Klazu

Hootsuite could also consider paying slightly higher wages to lure in professionals. I have been under impression that their salaries are not among the top end of the local tech scene.

If you are a tech startup, what is the point of being in Vancouver when you can be in Victoria. In Victoria your tech startup is part of a larger tech community and it is more affordable.

[Pinion]

Originally Posted by casper

If you are a tech startup, what is the point of being in Vancouver when you can be in Victoria. In Victoria your tech startup is part of a larger tech community and it is more affordable.

Do you have any proof that Victoria's tech scene is bigger? I tried to google that and came up with nothing.

I agree it makes no sense for anyone to set up in Vancouver.

Also it looks like twitter itself is having an existential crisis so it will be interesting to see how that affects Hootsuite.

[WarrenC12]

Originally Posted by casper

If you are a tech startup, what is the point of being in Vancouver when you can be in Victoria. In Victoria your tech startup is part of a larger tech community and it is more affordable.

What companies are in Victoria? Homegrown? Satellite offices?

I visit Victoria a few times a year to visit family, and I've never heard of any.