The Waterloo Region tech community needs to stop trying to emulate the model of Silicon Valley and instead play to its own inherent strengths, says serial entrepreneur and Auvik CEO and co-founder Marc Morin.
“Everyone says, ‘We want to be the Silicon Valley of the North’ and all that stuff,” Morin said Tuesday at a Communitech-hosted lunchtime event at the Tannery called Pizza with the Prez.
“I think everyone should vow, right now, to never say those words. Because what it’s doing is perpetuating the wrong metric and the wrong objective. We’re not that. So stop saying that.”
Instead, Morin says, the region and its companies should focus on basics: Develop, rather than acquire, talent. And sow the seeds that allow a forest of good companies to grow, rather than obsess about creating what he called a “tall tree,” meaning a Google or a Facebook or an Uber.
Most of all, he said, the region’s tech players must make peace with the notion that the Valley is a unique place, full of unique advantages and drawbacks, and that no city, not New York, or Amsterdam, or Paris, or Toronto, or Waterloo Region, is likely to ever replicate what it has become. And so stop trying.
“The Valley is the sun, [and] everywhere else is orbiting around the Valley,” said Morin.
Morin is a longtime leader in the local tech ecosystem. He co-founded networking pioneer PixStream in 1996, which sold to Cisco Systems in 2000 for US$369 million. He then went on to co-found Sandvine, and in 2012 he partnered with Alex Hoff to form Auvik.
Auvik’s software helps managed service providers keep IT networks running smoothly. The company raised CDN$15 million in a Series B round last August and it expects to reach 170 employees this year.
Morin, a University of Waterloo electrical engineering graduate who additionally holds an MBA from Wilfrid Laurier, yesterday drew a sharp line between the model of company growth defined in Silicon Valley and that which unfolds in other centres. The Valley, Morin said, is based on very large venture capital firms hunting for the next very large company – at the expense of everyone else.
“Fundamentally, that’s the culture in the Valley, the glorification of the tall tree in the forest. We don’t even have a forest here,” said Morin. “Our objectives need to be slightly different.
“Their whole mantra is, sift through ideas quickly, scale very quickly, spend lots of money, all to test whether you’re going to be a tall tree or not.
“If you’re not, they cut you off and move on.”
He said many Canadian VCs try to emulate the model set in the Bay Area, and do so at their peril.
“Most Canadian VCs have never even returned their [limited partner’s] original capital, let alone any return.
“Why is that? Because they’re playing the wrong game. They’re trying to play that game up here, trying to build that tall tree.”
Canadians VCs, he said, and Waterloo Region entrepreneurs, must recognize there are opportunities on what he called “the shoulders.”
He said local companies need to grow talent from within, rather than hope to poach from out west; onboard people and let them grow and evolve as needs change; embrace generalists.
“That’s the team we have. Play that team to its strengths.”
Morin’s words had added resonance in the context of this May’s True North Waterloo conference. The conference, to be hosted by Communitech, is a response, in large part, to the widespread perceived misdeeds of Silicon Valley-based tech companies and executives, summed up in closing remarks Tuesday by Communitech CEO Iain Klugman as “the Valley’s ‘ick’ factor.”
Canada, agreed Morin, is a fundamentally different place – one that embraces diversity and stands in stark contrast to the anti-immigration and protectionist climate in the U.S. It’s a card to be played to our advantage, he said.
“We have to be true to who we are and what we’re good at, and what we can and can’t do,” said Morin.
“It’s an asset, right?
“Canadians need to be proud of [the idea that] we’re going to be nice, and [then say] we’re still going to kick your ass.”