Government as Entrepreneur.

by alec on July 11, 2009

n.  A person who organizes, operates, and assumes the risk for a business venture.
The American Heritage® Dictionary of the English Language, Fourth Edition

Blazoned across the front page of the local rag, the Ottawa Citizen, this morning’s headline read Billion-dollar business fund overlooks city tech firms.  It seems the Ontario Government yesterday announced a $263-million grant  to establish a Toronto-based studio for French video game giant Ubisoft.  The funds are coming from the $1.15-billion Next Generation of Jobs fund, announced in March 2008, which has so far exclusively invested in the Southern Ontario cities of Toronto, Waterloo, and Windsor, overlooking the more than 1,800 companies in Ottawa’s tech sector.

Never mind that Ubisoft has more than $100-million in profits annually, or that the $263-million spent creates just 800 jobs over the next decade at a cost of $330,000 per job (after all, that’s cheap compared to the auto bailout), or that Dalton McGuinty’s government will run an $18-billion dollar deficit this year.  No, what really galls is the statement in May by then economic development minister Michael Bryant that “This is government picking winners and losers, government as entrepreneur.”

There is no element of risk in spending the taxpayers money.  Taxing struggling families to fund profitable multi-national corporations is closer to the centrally run economies of the Soviet Union than entrepreneurship.

Government as entrepreneur.  It’s enough to make you weep.

More to the point, however, the focus of the Next Generation of Jobs Fund is on employment in existing established businesses.  The money has gone to players in the plastics, automotive, entertainment, and health care industries.  Big announcements, and good photo ops, but a short term and short-sighted strategy.

What’s needed is a strategy to encourage job creation through new ventures and innovation.  For example, funds in the United States and Israel are demonstrating repeatedly that small investments in promising startups, with significant mentorship (think Paul Graham, or Yossi Vardi) can produce dramatic results (think Twitter).  It’s easy to think of a number of successful Ontario entrepreneurs that might be a homegrown Graham or Vardi.  The incentive to invest would be that much greater if the Ontario government had some programs targeted at encouraging those entrepreneurs to invest their dollars in some real entrepreneurs, rather than photo-ops for the Premier.

“It would be so nice if something made sense for a change”, said Alice.
Alice in Wonderland, Lewis Carrol.

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SCANning the Ontario Tech Corridor

by alec on May 11, 2009

Ottawa tech folks know Tony Patterson’s SCAN as the news source for the local technology industry.  Since last fall, Tony has been chatting with a few of us, myself included, about how to broaden the appeal of SCAN.  Last week he unveiled a new SCAN focused on the Ontario Technology Corridor, from Ottawa through Windsor. With 6,000 companies and 250,000 workers in the Ontario tech industry, he plans to cover everything form bio-tech to software and the communications industry.  The format of the site is easily digestible, with quick single paragraph stories and longer pieces from invited bloggers and tech executives.   

If you have an interest in Canadian tech businesses, visit the new SCAN and let Tony know what you think.


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Casting my vote

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I went and voted at the advanced poll last week. I’ll be watching the returns from Las Vegas Thursday (if it’s on TV there).  Despite my distaste for the tactics the Ontario PC’s employed during the campaign, I voted for them.  As I read more and more about the McGuinty platform, I become more convinced that […]

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