Former RIM co-CEO says lobbying is critical for a sector based on developing ideas that will generate economic value.
October 8, 2015
by CANADIAN PRESS
OTTAWA — Jim Balsillie says there’s a major policy gap when it comes to nurturing Canada’s budding high-tech firms, and he has a plan to fix it.
With an eye on missed opportunities in the Pacific Rim trade talks and the federal election campaign, the former co-chief executive of Research In Motion is helping entrepreneurs in the sector set up a made-in-Canada lobby group.
“It’s a bizarrely missing piece . . . The discourse in the country is dominated by people who have never done it,” Balsillie said in an interview.
“The game is won and lost substantially by how the rules are shaped – and they’re shaped and changed dozens of times every day. And this idea of being passive and thinking the rules are going to work for you is naive.”
Balsillie has credited persistent lobbying efforts with governments – not only in Canada, but in the United States and beyond – for helping his old company grow into a $20-billion global player.
In the interview, Balsillie recalled how he personally pressed for RIM’s interests in Washington once a month, in Brussels once every three months and in Ottawa every couple of months.
He described lobbying as a critical ingredient for a sector based on developing ideas that will generate economic value – an area he said is often misunderstood by policy makers because it differs from traditional industries like manufacturing.
The lobby group, which will create a single voice for some dozens of CEOs and founders of indigenous Canadian technology businesses, should be operating in the weeks following the Oct. 19 election.
It means that before long the next federal government will have a new organization knocking on its door.
Balsillie said up until now only multinational companies from the innovation industry – big players like Google, Facebook, Microsoft and Amazon – have been regularly securing face time with Canadian politicians. He said they’ve brought their “very sophisticated” lobby efforts to meetings in Ottawa on an almost-weekly basis over the past two years.
By contrast, he said Canadian tech firms have been slow to grasp the importance of actively pushing the public-policy discussion, which will help forge the all-important regulations that govern their industry.
“You have to start taking matters into your own hand and tell the policy makers what, specifically, you need,” said Balsillie, who added it’s not that politicians don’t want to do the right thing, it’s that no one is talking to them.
He acknowledged the lobby group’s creation will come too late for negotiations of the Trans-Pacific Partnership, a massive, 12-country trade deal signed by Ottawa earlier this week.
Dairy and auto-sector lobby groups were aggressive in the lead-up to the TPP, a pact that also includes areas of interest to the tech sector, including intellectual property.
With less than two weeks before the federal election, the lobby group will also miss out on providing input to campaigning political parties.
The organization, which has already obtained office space, will also promote the Canadian industry’s interests abroad.
This aspect is crucial to companies like D2L Corp., which develops online learning platforms and has offices in Canada, the US, Europe, Australia, Brazil and Singapore.
John Baker, D2L’s president and CEO, said the company was tied up in litigation in the US for three and a half years with one of their competitors over intellectual property.
D2L prevailed after a “long and hard road,” he said, but the situation might have been avoided if the company had voiced its position beforehand with the local government.
“If we’re not having that dialogue and, even worse if our competitors are, then it puts us at a very big disadvantage as we go to compete both in our country as well as globally,” Baker said in an interview.
He said Balsillie inspired CEOs like himself to form the group.
“He’s actually climbed the mountain,” Baker said of Balsillie. “He’s built a $20-billion company.”
John Ruffolo, CEO of one of the country’s biggest venture-capital firms, said Canada’s innovation sector wasn’t quite ready to create a lobby group in the past because it had been struggling until about four years ago.
Its future now looks bright, added Ruffolo, the head of OMERS Ventures.
“But one thing is violently clear – there’s almost universal consensus of ‘Yes, you’re right, we need to have a single voice,’ ” Ruffolo said.
Balsillie argues the country’s prosperity will depend on the success of commercialization ideas, which will also affect innovation in traditional industries such as manufacturing and natural resources.
He said the innovation economy has shown zero growth for three decades and has a considerable productivity gap with the US despite billions of dollars of government assistance.
An internal government memo, dated from last October and obtained by The Canadian Press, said billions of public dollars spent over two decades did little to reverse Canada’s long decline in business innovation.
On the campaign trail, Balsillie said political parties have continued to pitch similar tweaks for the sector, such as tax credits, cash for basic research and investments for incubators.
“But none of them has a strategy,” said Balsillie, who aims to help these companies provide input to policy makers.
“It’s the definition of insanity by Einstein, which is to do the same thing over and over again and expect a different outcome.”
© 2015 The Canadian Press