The Sask Tech Sector Shines On

Sask Startup Summit - Photo provided by Conexus Credit Union

At the Sask Startup Summit in Regina this September, the energy of the Saskatchewan tech sector was on full display. The two-day event nicely illustrated the direction of the industry and the growth that Saskatchewan is experiencing. The impressive list of speakers from around North America and the packed seats in the workshops was a great indication of what is happening here. It was a telling moment speaking to an entrepreneur attending the conference from Toronto, when he said he had come to see for himself what the buzz was about—as he was considering Regina in the spring to launch his startup. He was quick to point out he was waiting until winter was over—there were things he needed to do in preparation anyway and wasn’t ready to brave the cold. However, when deciding to launch his tech startup, he was willing to brave the actual climate because he felt the industry climate would give his company a better chance to take root and grow despite a deeper investment and labour pool in Toronto’s tech scene. And, the work that has been going on to grow the Saskatchewan Tech Sector has not gone unnoticed outside of the province.

Sask Startup Summit. Photo provided by Conexus Credit Union.

At the Startup Summit, the focus was on startups and newer businesses getting ready to scale. Speakers included venture capitalists, high-growth tech company managers, and marketing experts from San Francisco, Vancouver and New York—and an audience of entrepreneurs and investors collaborating between cities across the Prairies. This developing culture aims to give companies a better chance to thrive, and it’s a relatively new environment—but innovation in tech is nothing new in Saskatchewan.

Bryan Janz, president and CEO of Lexcom, got started around the time the Y2K bug had everyone convinced the world was going to end at midnight New Year’s Eve 1999 thanks to some faulty programming. At the time, Bryan and his brother Garry were basically refurbishing computers bought at auction and selling them to fund their consultancy as they went after larger contracts while working out of their basement.

“Going after some of the larger contracts, we rented an office on Albert Street to give us some credibility when submitting proposals,” Janz explains. “The address didn’t matter as much as the timing though, and our personal interests. We happened to be obsessed with the right things at the right time, and Lexcom gained a solid reputation in the local marketplace.” And this local marketplace included companies such as TMC, PC Place, F.A.C.T. Computers and Dotcom (which would later become Jump.ca).

Lexcom was bootstrapping at the time but a shift to larger contracts began with a short-term contract with the federal government and the provincial governments. The contracts would allow the company to reinvest in itself, acquire an office building on the edge of downtown Regina, and expand their workforce. At one point, recalls, Bryan, he took a substantial pay cut to move to a well-respected consultancy so he could get experience in areas he was interested in. The move paid off and he collected a variety of certifications in proxy servers and internet technologies just as they became more mainstream. “Classic right place at the right time,” says Janz.

The story highlights the difference it can make to a company in Saskatchewan to land a government contract, something that has actually been difficult for local companies—but is a process being looked at and addressed by Innovation Saskatchewan through programs like the Made In Saskatchewan Technology program.

Programs and the current atmosphere is what new companies are hoping to take advantage of. For example, Kristy Ehman, the CEO and founder of HYON, is launching a platform she compares to Shoppify for consignment. “I started a kids consignment company last year and was prepared to pay for software but it didn’t exist. We found other events had a similar problem in automating their events. So, now we’re making that automation available,” she says. “We started from scratch—there are pieces of marketing tools and CRMs (customer relationship management systems) but the magic is the communication between the consignment level and all the other platforms that exist.”

The consignment industry itself is well-established and mainly driven by volunteers. However, as people are volunteering less and doing more online, it becomes a question of how to stay current. As a non-technical founder of a tech company, Kristy needed to build a team to move her project forward. With her co-founder, Blair Kelsie joining the team, HYON has taken big strides. Blair Kelsie is an experienced entrepreneur with some impressive local chops.

“Blair was with Vendasta in the early days…then was with Skip The Dishes and just left Skip to invest in and join Hyon. I didn’t know how bad we needed him until I got him. I should have had him a year ago!” Ehman explains. “That’s timing—the Cultivator and Co.Labs are feeding that experience, helping more founders get more help quicker. You don’t have to have all the answers to explore a business in technology. If there are ideas—reach out to me, reach out to other founders and the supports that exist like Cultivator and Co.Labs. Have people challenge your idea and connect you with the right people to get that idea moving.”

Sam Dietrich of Prairie Robotics would likely agree.

“It’s hard to predict at this stage but I think we’ll see rapid growth in the Sask tech scene for at least the next 20 years before plateauing. I think the support available today (Co.Labs, Cultivator, Innovation Saskatchewan, Innovation Place, Economic Development Regina, Audacity, additional provincial funding and all the federal grants available) make it easier than ever to launch a startup. While the recent successes in terms of investment such as Vendasta, 7Shifts and SalonScale show that Saskatchewan is capable of developing profitable technology companies.”

The University of Regina graduate has won several awards in robotic competitions, developing technology to autonomously operate farm equipment. His awards didn’t just land prize money but also a job offer from DOT Technology Corp. working on the first autonomous agricultural power platform.

His current project is SightScale, and his pitch at the Sask Startup Summit earned him another cash prize. He’ll be putting the money towards his project hoping to automate, digitize and streamline the process of intake and management at waste disposal sites across North America.

That’s a lot of big, new ideas coming out of Regina. Big ideas in Regina are nothing new, but the opportunities for companies here now compared to the past have been drastically improving.

Wanda Hunchak.

The Golden Opportunities Fund started 20 years ago as a local Retail Venture Capital (RVC) Fund for Saskatchewan people to invest at home in Saskatchewan businesses. The fund is managed by Westcap Management. Ltd., and their executive vice-president, Wanda Hunchak, says that we have seen the start of something exciting in the last three years.

“What we’ve seen in the last their years is this development of an ecosystem that starts with Co.Labs and Cultivator and the support and visibility and the mentorship that they have brought to early stage companies in Saskatchewan,” Hunchak explains. She outlines the developing path in Saskatchewan that aims to foster growth. Companies now have the ability to move through early stages, proving viability and getting easy access to mentorship and early funding that has historically been difficult to find in Saskatchewan. Add to that the Saskatchewan Capital Network and the angel investment that is being spurred on by the Saskatchewan Technology Startup Incentive and companies have options for that early investment before they may be ready for investment at the level of the Conexus Venture Capital Fund and eventually Golden Opportunities Fund.

“So you really see the development of a well-heeled ecosystem here, and some of the things we’re seeing in terms of the sheer number of companies started, and the success we’re seeing in terms of the companies coming out of the system—the ecosystem is forming and doing what it’s supposed to do,” says Hunchak.

What’s happening here has happened elsewhere and that is by design. A lot of time, energy and research went into setting up the supports for the system. So, it’s not unique, and that’s good. It means we can learn from tech ecosystems that have existed for years and have matured and proven effective.

Sask Startup Summit. Photo provided by Conexus Credit Union.

“We are seeing it happen here,” says Hunchak, “And it’s happening really fast in Saskatchewan because we’ve been priming ourselves for so many years, we’ve got some really innovative companies and good talent and the metrics are good here. It’s cost-effective to do business here, there’s lots of support from local government, provincial government, and educational institutions to try and figure out how we play in to this ecosystem and make sure there’s enough workers to work at the different companies and scale them up. We’ve got the infrastructure in the Regina Research Park and Innovation Place—and the mindset around innovation here in Saskatchewan. And I think all of that has come together to expedite how fast this momentum has been created in our province. That I think is unique in Saskatchewan—how fast it’s happening.”

“The other thing that is really unique is the partnership and that mindset around ‘together we can be stronger’ than if we compete. Our incubator programs work so well together, our funds—Golden Opportunities Fund and the Conexus VC Fund, we would love to do deals together if they make sense within our mandates. There isn’t this mentality of competition—it really is more about how together we can be stronger, and you’ll notice that even in the conferences and events that are held here,” she says.

Historically in Saskatchewan there has been a talent drain and certainly in the tech industry, it’s been very noticeable. We’ve always had great ideas and talent but historically it has left because we haven’t had the infrastructure in place to support it. That’s changing now, according to Hunchak.

“When you hear about 7Shifts and Vendasta and the hundreds of jobs they’re advertising and bringing on and you start to do some of the impact numbers around that it’s a huge impact here on our provincial economy. And what’s interesting about that is these are jobs that are not necessarily linked to the price of oil, or the price of potash, whether it rains or is too hot or doesn’t snow in the winter. This is an important diversification tool for the province of Saskatchewan and the stability of our economy.”