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Startups, here’s how you can prepare to combat an economic downturn

A blueprint to super-proof your startup and protect against economic instability.

With record-high inflation, wars overseas and rising interest rates, experts are telling Canadians to brace for an economic downturn and warning signs are starting to trickle to the startup and innovation economy, which can affect in a multitude of ways.

Over the last year, Canada’s tech ecosystem showed explosive growth – in fact – a recent BDC VC report showed that Canada had a record year for venture capital, breaking records by almost every metric.

While some in the startup ecosystem are sounding their warning bells, like Silicon Valley-based Y-Combinator, the industry is still positioned to continue its growth. Is it always going to be clear sailing? No. But what we’re seeing is not a halt to our momentum but rather a course correction.

It’s second nature for startups to pivot and change their mindsets to focus on the opportunities at hand. Just look at Uber, Pinterest and Whatsapp, all household names that came out of the 2008-2009 recession!

We’re here to make sure that founders stay resilient, agile and are prepared to bear the punches that may come their way.

iPad screen with stock market metrics - Economic downturn blog

So what can you do to start planning ahead and super-proof your business? We’re glad you asked.

1. Leverage liquidity.

Finding the right liquidity balance for your business can not only help you gain insight into if you have enough cash to pay off your short-term liabilities. but also allows you to set yourself up for strategic growth. Having enough cash on hand is important to meet financial obligations, but holding onto too much cash might leave important investment and growth opportunities on the table. Finding the right balance will ensure long-term stability and provides a good first impression when looking to secure a loan or other funding.

2. Budgeting, budgeting, budgeting.

This goes without saying, but take a moment to sit down and understand exactly where your money is going and where your main sources of revenue are coming from. Getting a thorough understanding of finances will help make tough decisions – if need be – quickly and effectively.

3. Lock in longer commitments.

Focusing on closing longer commitments such as subscriptions or multi-year agreements with customer, partnerships and client can ensure financial security in uncertain circumstances. Recession or not, this is a great tip for any startup that is looking to extend its runway and demonstrate loyalty to customers and partners.

4. Cut costs.

It’s only natural to turn to cost-cutting measures but it’s important to remember one thing – cutting costs does not mean you need to let go of talent. Cutting costs means reevaluating your spending to axe unnecessary costs. Create plans for different levels of financial scarcity to work for different scenarios the ecosystem throws at you.

5. Back-up business plans are your best bet.

This is similar to the last point, but apply it to your entire business plan. Your best bet in preparing for the unknown is to create multiple overarching plans that fit a range of realistic possibilities. These plans should include securing funding as planned, securing a smaller amount and not being able to secure funding at all. Look at other forms of funding as alternatives, whether it be grants, crowdfunding, bank loans or support from family and friends.

Workers having a meeting - Economic downturn blog

Want to learn more about how you can solidify your contingency plans? Apply to a DMZ program here.

The DMZ’s News Roundup: What went down in May

Canada’s venture deal woes, the country’s latest unicorn company and the DMZ’s incoming Bootcamp cohort – this is your monthly DMZ news roundup.

Power up with the DMZ’s News Roundup: a blog series dedicated to providing you with a quick look back on what went down in the Canadian startup and innovation ecosystem this past month.

We’ve got you covered with the most relevant news and notable wins from the ecosystem, DMZ updates and more.

Here’s a rundown of what went down.

INDUSTRY NEWS

New BDC report reveals a record-breaking 2021 for venture capital and private equity deals, while 2022 is expected to experience turbulence

A new BDC report revealed that 2021 was a shattering year for VC, with Canada breaking records by almost every metric. Canada saw a jump in domestic and international VC investing, with 752 deals made, representing $14.7 billion CAD. However, this past quarter, VC deal counts and the money behind private equity deals took a fall. Despite the forecasted challenges, BDC suspects that the startup economy and Canadian entrepreneurs are well-positioned to take them on.

Check out the full report here.

Neo Financial secures $185 million CAD in Series C funding, becomes the country’s newest Unicorn status company

Calgary-based Neo Financial closed their Theil-led Series C funding round, in which they raised $185 million CAD. This additional funding launched the company’s valuation to more than $1 billion CAD, making them the newest tech company to earn official unicorn status in the country. Neo Financial is an online bank bringing a low-fee alternative to the Canadian financial market, helping users save costs on spending and earn high interest on savings.

Learn more here.

Neo Financial becomes Calgary's latest $1 billion tech 'unicorn' | The Star

STARTUP NEWS

SPM solution provider, Forma.AI, is expanding platform development with $45 million CAD secured in Series B funding

DMZ alumni Forma.AI (Incubator ’18), a sales performance management solution provider, recently closed its Series B funding round. With the $45 million CAD secured in funding, they plan on expanding the marketing and development of their fintech platform.

Read more here.

Fable secured $10 million USD to make online accessibility a reality for disabled users

Fable (Incubator ’20), a Toronto-based startup that helps companies make digital products more usable by people with accessibility challenges, announced a $10.5 million USD round in venture capital funding to support the company’s growth. Alwar Pillai, CEO and Co-Founder of Fable, says the company is focusing on unlocking access to more clients by targeting large corporations’ digital teams to target their users.

Check it out here.

WBI-affiliated technology firm CyborgTech to acquire DMZ FinTech alumni Fortuna.AI

DMZ alumni Fortuna.AI (Incubator ’18) announced its acquisition from WBI-affiliated technology firm CyborgTech, home to robo advisory platform Cy, for an undisclosed amount. Fortuna.AI is an AI-powered platform helping financial services scale digital tools to get new clients in the marketing and advertising sector. Fortuna.AI was the winner of the DMZ-Bank of Montreal Fintech accelerator program.

Learn more here.

DMZ NEWS

Introducing the DMZ’s Bootcamp Fall 2022 cohort of cutting-edge tech companies

In a new DMZ blog, we welcome 13 up-and-coming tech companies into our new Bootcamp cohort. Hailing from across Canada, the United States, Brazil, Estonia and Africa, this new cohort is already hitting above their own weight in a diverse range of industries. Check out all the companies in our new Bootcamp cohort here.

Looking for more startup ecosystem news and DMZ updates? Subscribe to our bi-weekly newsletter to stay in the know here.

Hear from the DMZ’s first-ever unicorn founder for his advice on building a billion-dollar company

Event recap: The DMZ’s Founder Dinner

Co-founder and CEO of brand interaction platform Ada, Mike Murchison, spilled the entrepreneurial tea at the DMZ’s Founder Dinner earlier this month, sharing lessons learned from scaling the first-ever DMZ unicorn company the ground up.

Empowering brands to automate customer interactions, Ada brings a VIP experience to every customer and employee through its platform. Since 2018, Ada has increased its revenue by 764% and in 2021, raised its Series C at a valuation of $1.2B, officially achieving unicorn status.

The first in-person DMZ Founder Dinner since 2019, the events are designed to bring the larger DMZ founder community together for an evening of food, drinks and connections.

We thought we’d share some of Mike’s insights and how he built the first-ever DMZ unicorn company for other founders looking to build the next big thing. Watch his full founder talk below to learn more about Ada and Mike’s journey, or keep reading for a recap of the tips and learnings Mike shared with the audience during his talk.

Entrepreneurship is a deeply personal experience

“We in this room are all united by this shared dream of building something important, big and world-changing. The journey that we’re all on is a very, very unique one, but we’re all unified in that shared ambition.”

The value of improving your rate of learning

“I think the single most important thing I’ve learned over the course of this journey has been a deep inward focus on improving my own rate of learning.

I think that’s one of the things I so admire about the community here at the DMZ, is that we’re all committed to learning. We’re all highly curious people who are eager to learn new things.

I encourage you to ask yourself, ‘What is piquing my curiosity? What problem am I facing that may seem insurmountable that I may be able to learn something new from?'”

Founders have a responsibility to support one another

“We all have a responsibility as founders to support one another in our own growth. I encourage everyone making progress themselves to share it with others.

We’re not competing against one another, we’re supporting one another. We all win when a startup in our ecosystem succeeds.”

Mike Murchison talking with another guest. - DMZ Founder Dinner recap

Sometimes the easiest path IS the right path

“I was dealing with a hard problem and someone asked me, ‘What if it wasn’t hard? What if it was easy?’

I’ve grown up and trained myself into thinking I need to do the hardest things, and what I’ve learned in the course of building Ada is that sometimes the easiest path, where you’re feeling the pull, is actually the right path.”

Don’t take yourself too seriously

“Looking back, something I would’ve done differently is not taking myself so seriously.

I wasted a lot of energy thinking about what the ideal path was meant to look like. I wish – earlier on – I would’ve let go of my perception of the right path and been more excited about the path that was unfolding before me.”

DMZ card that says "Changing entrepreneurs' lives." - DMZ Founder Dinner recap

Want to have a front row seat at the next DMZ Founder Dinner to hear from other founders who have made it? Apply to our upcoming Incubator cohort kicking off this fall at dmz.to/incubator.

Meet 13 up-and-coming tech startups in the DMZ’s Bootcamp

Introducing a new cohort of Bootcamp companies who are hitting above their weight across a diverse range of industries

Our newest Bootcamp cohort is in full swing, and we are thrilled to present the 13 tech companies that we have hand-selected to take their businesses to the next level. For the next six weeks, the DMZ will help these founders validate their business idea, establish a minimum viable product and build a roadmap for implementation to launch their startup.

Our Bootcamp founders get the chance to participate in peer-to-peer sessions, founder roundtables and expert-led workshops, receive 80+ membership benefits valued at $470,000+, have one-on-one support from our DMZ Program Leads and much more. Post-graduation, they will be on track to launch their startup within three months and generate revenue within six, allowing them to kick-start their entrepreneurial journey!

We are delighted to share that our new cohort of startups have a global reach, with startups across Canada, the United States, Brazil, Estonia and Africa.

So, without further ado, please welcome our incoming cohort of cutting-edge companies:

Newest cohort of DMZ Bootcamp tech startups
BestAuction

Newest cohort of DMZ Bootcamp tech startups: bestauction

BestAuction is a digital platform designed for individuals and SMBs to manage the procurement process and initiate digital cross-collaboration.

Troop Impact

Woman Founders stream
Newest cohort of DMZ Bootcamp tech startups: troopTroop Impact is a social impact tech platform for SMBs that allows businesses to meet the social responsibility demands of employees and customers by voting monthly on where their company’s social impact dollars will be allocated.

TechFusion

Black Innovation Program stream
TechFusion is an accessible digital banking platform for credit unions, cooperatives and savings groups, targeted toward the unbanked and underserved in Africa.

SensaioTech

Newest cohort of DMZ Bootcamp tech startups: SensaiotechSensaioTech is an end-to-end fire risk assessment solution that is able to monitor and predict when and where a wildfire will occur using artificial intelligence.

Paysync

Black Innovations Programs stream
PaySync is a financial technology services company developing financial solutions for employee wellbeing and productivity.

Gander

Black Innovation Program stream
Gander is a B2B, subscription-based, AR and 3D modelling API plug-in service designed to allow customers to virtually interact with products on e-commerce sites.

ZewalletZewallet

Zewallet allows customers to scan a QR code to tip, split and pay a bill at the end of their meals, benefitting both customer experiences and merchants in cost and time efficiency and in increased revenue.

ZaNiheza

Woman Founders stream and Black Innovation Programs stream
Newest cohort of DMZ Bootcamp tech startups: Za NihezaZaNiheza is a dual booking software and travel marketplace that empowers verified operators to list and sell quality experiences online to travellers.

Sleekscore

Black Innovation Program stream
Sleekscore is a financial technology company that seeks to assist those who are either unfamiliar with credit or inadequately served by traditional financial products to build and improve their credit scores while getting into the habit of saving money.

Scooli

Black Innovation Program stream
Scooli is a one-stop-shop digital solution for educators that minimizes the time teachers and administrators spend on redundant administrative tasks.

Frenzy Brands

Frenzy Brands

Woman Founders stream
Frenzy Brands extends a child’s understanding of the stock market, business and investing with a focus on learning through play.

LeaderTree

Black Innovation Program stream
LeaderTree is a single integrated platform that enables effective leaders,

teams, collaboration and results through assessments, training, coaching and tools to understand strengths, needs, tendencies and preferences.

DataCalculus

Woman Founders stream
Data CalculusDataCalculus is an automated software that acts like a personal computer but for the purpose of advanced data analytics and machine learning for the mass market.

 

If you are an early-stage tech founder and are interested in joining the DMZ Bootcamp alongside amazing peers like these, check out more about the program and its selection criteria here. Our next cohort kicks off September 2022!

Revolutionizing insurtech: How Baoba is providing customized insurance products with efficient returns across the globe

On Wednesdays, we startup.

To celebrate our women-identifying founders, we’ve put together ‘On Wednesdays, we startup’, a blog series dedicated to putting women founders centre stage to acknowledge their work, complexities and wins!

We hope to push women-founder stories forward and share lessons learned and insights for other aspiring women entrepreneurs.

This week, we had the pleasure of chatting with Kata Ludvig, the Founder of Baoba, to learn more about her startup and how she’s modernizing the insurance industry to keep up with expectations of the 21st  century customer.

Can you tell us a little about yourself and why you founded Baoba?

I spent my early career working across various Fortune 500 companies, including Mercedes, Red Bull and Walt Disney. I was first exposed to the world of startups when I co-founded BankZee, a family banking solution for Generation Zers and their parents. I then led Flight Refund as CEO, a legal aid solution for travelers and also consulted for location intelligence and deeptech company Datapolis where I spearheaded business development in Singapore. It was only last December I finally decided to take the plunge and found my current startup Baoba.

It was actually during my time at Flight Refund, where we dealt with delay-related airline compensation cases, that I saw the need for flexible travel protection as an aftermath of the pandemic. Three weeks after I had joined the company as CEO, over 90% of planes were grounded due to the pandemic. This is when the significance of financial protection and the need for flexible insurance really hit me and it inspired me to radically rethink insurance products beyond airline delays. Users today don’t have access to personalized insurance coverages – it’s still a one-size-fits-all product. In a world where we customize almost every aspect of our lives, insurance coverage was falling behind.

Airplanes on tarmac - How Baoba is revolutionizing insurtech

What exactly is Baoba’s mission?

Baoba is on a mission to change the way insurance is sold – we believe that the insurance industry needs to catch up to the expectations of the 21st century customer.

Baoba is offering what today’s customers need – a personalized and automated on-demand service that can insure. By providing personalized insurance that can adapt to our customers’ habits and lifestyles, we hope to become the global ecosystem orchestrator for intermediaries and resellers for on-demand insurance needs.

Despite Baoba being an early stage startup, you’ve already set up shop in Canada, the United States and Hungary. How has your experience been working across global markets? How important was it for you to have a global presence?

The decision to break into new markets was not only a conscious decision made by the company, but a necessity due to the nature of the industry. Our distributors and insurance partners operate internationally, so we had to make our products available globally and adopt a multi-market mindset from the get-go. We have an international team scattered across the world spanning Hungary, Italy, Turkey, France, Costa Rica and the United States.

While working globally has its benefits it also has its difficulties as well, including administering payroll and working across timezones. Public facing efforts also need to be managed more carefully, like public relations in different countries and multilingual customer support.

Our global presence is also extremely important from an investment perspective. Being a CEE (Central and Eastern Europe) Founder, it’s tough to break into the North American market. However, we’ve been able to attract talent, partners and angel investors from all over the world. I have no doubt that the DMZ will play a huge role in supporting us as we break into new markets and finesse our North-American go-to-market strategy.

The insurtech market has skyrocketed globally, projected to reach nearly $190 billion CAD by 2030. Could you tell us a little about the momentum the industry is facing?

It’s easy for millennials and Gen Zers to take personalized products and services for granted, as this has become the norm. Today, almost every aspect of our lives is customizable, and the financial and banking industries have been cashing in on this movement.

Insurance at its core is a hassle for most of us, as a result of inconveniences such as manual claims processing, lengthy documents, confusing language, unclear conditions, and long payout processes.

Insurtechs have not only recognized that there is an issue to solve, but have also identified opportunities to improve the insurance value chain. This ranges from improving claims processes, to AI and machine learning-driven solutions, to data-driven fraud detection and customizable insurance products.

Girl working at computer - How Baoba is revolutionizing insurtech

Baoba recently announced a partnership with Blink Parametrics to roll-out a flight-delay solution. What exactly does this new partnership mean for Baoba?

Our partnerships with Blink Parametric enables us to further expand our client portfolios with valuable, automated and on-demand travel insurances that are supported by claim processing and real-time pay-out solutions. This is our sweet spot – where world-class insurtech and customer experience collides.

Now our partners can connect to our platform with a single API to embed parametric products or sell standalone products.

What advice would you give founders looking to break into the insurtech space?

  • Think fresh – A background in insurance isn’t necessary, having a novel idea and asking the right questions are your way in. Someone who has worked in the industry for say, 20 years might be too comfortable to shine light on a new perspective that reflects the needs of the current market.
  • Know your purpose – Narrow down a clear value proposition and strategy, and focus on building that. As you grow, you will be presented with many opportunities and emerging innovations in various areas of the industry. It can be very tempting to differentiate and try to tackle several areas, but you don’t want to take away from your core offerings, values and promises.
  • It’s a small world – Despite being a global industry, insurance industry insiders are well-connected through incumbents, insurtechs, challengers and investors. It’s crucial to network and build strong relationships, as well as have a solid unique selling proposition.

What’s next in store for Baoba?

Baoba’s next steps include closing an upcoming seed round of $1.5M USD and expanding into North America. We are also looking for niche talent working at the cusp of data science and insurance to help us flesh out an intricate product strategy and bridge our minimum viable product with our five year vision.

Head over to Baoba’s website to learn more about how Kata is revolutionizing the insurance industry.

 

Want to learn more about how you can help Baoba on their journey? Reach out to their team at hello@gobaoba.com.

The DMZ’s news roundup: What went down in April

The federal government unveiled their budget, American investors are flocking to Canadian tech, and our newest tech startups — this is your monthly DMZ news roundup.


Power up with the DMZ’s News Roundup. Our new blog series is dedicated to providing you with a quick look back on what went down in the Canadian startup and innovation ecosystem.

We’ve got you covered with the most relevant news and notable wins from the ecosystem, DMZ updates and more. 

Here’s a rundown of what went down in April. 

INDUSTRY NEWS

How the Federal budget will impact the startup and innovation economy

The federal government unveiled their long-awaited budget for 2022, which outlines a number of commitments for the Canadian tech and innovation economy. The first budget since the Liberal’s re-election last fall, the 2022 budget focuses on growing the Canadian economy while aiming to make everyday life more affordable. Big ticket commitments include a new innovation and investment agency, a growth fund to encourage private sector investments and a commitment to build a world-class intellectual property regime. 

Read more here.

Canadian innovation companies come to a halt on TSX

In the first quarter of 2022, there was not a single Canadian innovation company that went public via an initial public offering (IPO) on the Toronto Stock Exchange. 2021 saw a record breaking year for IPOs, with seven companies going public in the first quarter alone. 

Learn more here.

New report shares gender biases women founders face in raising capital

A recent study from the Conference Board of Canada found that compared to men, women take longer to raise Series A financing. Marie Chevrier Schwartz, Founder and CEO of Sampler (DMZV), shares her experiences raising capital and the gender bias she faced with Betakit.

Check out her interview here.

STARTUP NEWS

PocketHealth closes $20M CAD Series A financing to transform medical image access

PocketHealth (Incubator ‘18), a patient-centric medical image sharing platform, has secured $20M CAD in Series A funding led by healthcare venture capital firm Questa Capital. PocketHealth will be expanding its talent base, building U.S and Canadian clinical partnerships and invest in product innovation. 

Read more here.

U.S investors are pumping cash into Canadian enterprise tech startups

U.S venture-capital investors raised a record $13.6B USD last year in Canadian information-technology startups. In recent years, Google, Microsoft, Intel, and Uber have opened or expanded offices and research-and-development campuses in thriving tech hubs such as Toronto and Vancouver. In turn, this has fostered a homegrown pool of skilled tech workers that is becoming increasingly scarce in the U.S. More than half of all Toronto-area venture-capital deals have included at least one American investor.

Learn more here.

DMZ NEWS

12 tech startups that are disrupting the Canadian tech ecosystem – Meet the DMZ’s Incubator spring cohort 

Out of hundreds of the high-calibre startup founders that applied from Canada and around the world, the DMZ has hand-picked 12 tech companies to join a new 18-month cohort in the Incubator. This cohort has startups joining from Vancouver, Canada to Budapest, Hungary, across diverse industries like logistics, insurtech, fintech, proptech, and more.

Check out the tech companies here

Looking for more startup ecosystem news and DMZ updates? Subscribe to our bi-weekly newsletter to stay in the know here

Meet the DMZ’s Spring ‘22 startup cohort

Introducing the DMZ’s newest cohort: 11 tech startups that are disrupting the Canadian tech ecosystem 


The DMZ Incubator is a market validation and traction program that helps venture-backable pre-seed and seed-stage startups execute their go-to market strategy, acquire lighthouse customers, gain media exposure, explore global expansion, preparing for the next round of funding, and much, much more.

Out of hundreds of the high-calibre startup founders that applied from Canada and around the world, the DMZ hand-picked 11 tech companies to join a new 18-month cohort in the Incubator. 

This cohort has startups joining from Vancouver, Canada to Budapest, Hungary, across diverse industries like logistics, insurtech, fintech, proptech, and more.

Introducing our Spring ‘22 Incubator cohort:

 

AssetFlo is building the next generation of location products to help the supply chain increase visibility with a single device that works everywhere and eliminates costly infrastructure.

Baoba is creating street-smart insurances by combining location intelligence with technologies to create geo-triggered coverages. Baoba’s vision is to become the #1 global ecosystem orchestrator for on-demand insurance needs and the platform for connecting a fragmented market.

Carmodity partners with car dealerships to provide lease-financing to customers in a debt-free and interest-free model.


Cozii Technologies provides sustainable residential and commercial properties management services. Their flagship product Cozii Proptech allows residential landlords to manage their rental properties from anywhere in the world. 

Lightster is a mobile platform that enables tech startups to build instant user communities for input and co-creation, and rewards users for their time with exclusive access and cash.

Monosens helps industrial machine builders and maintenance providers predict which machines need maintenance or aftermarket services using IoT technology and AI.

Businesses, governments, and individuals share many important documents every day. myLaminin uses Blockchain to deliver security, convenience, and control to the document issuer, document holder, and third-party document verifiers.

Reyts is a marketplace that allows individuals to swap currencies seamlessly and securely.

SizeWize offers an AI-backed fit recommendations eCommerce app that ensures online shoppers can buy the right size online, providing reduced returns, increased conversion, increased AOV, targeted marketing and optimal supply chains. 



ShiftRide is a car subscription service allowing people to subscribe to cars listed by owners and dealerships in the community. Every subscription comes with maintenance, insurance options, and flexible terms that suit any lifestyle.

VRapeutic is an Ontario-based UNICEF Innovation Fund portfolio software house specializing in developing therapeutic and rehabilitation solutions, with a focus on virtual reality (VR) for learning and developmental challenges.

 

If you are an early-stage tech founder interested in joining the DMZ Incubator, check out more about the program details and selection criteria here.

2022 federal budget digest

How the 2022 federal budget will impact the startup and innovation economy.


Last week, the federal government unveiled their long-awaited budget for 2022, which outlines a number of commitments for the Canadian tech and innovation economy.

The first budget since the Liberal’s re-election last fall, the 2022 budget focuses on growing the Canadian economy while aiming to make everyday life more affordable. Working to reduce its projected deficit, a majority of the government’s new commitments are program-focused, rather than large cash injections. 

We thought we would help out our community by breaking down the budget to highlight what should be on your radar, and how it will impact the startup and innovation economy.

The full federal budget can be found here.

AN OVERVIEW: BIG TICKET COMMITMENTS

  • Canadian Innovation and Investment Agency: $1 billion over five years towards the creation of a new agency designed to invest in innovation, research, and development. 
  • Canada Growth Fund: A $15 billion growth fund to encourage private sector investment to meet net-zero climate goals and strengthen supply chains.
  • Intellectual property: $96.6 million over five years to build a world-class intellectual property regime, by building on previous investments.
  • Scientific Research and Experimental Development (SR&ED): A review of SR&ED to eliminate paperwork needed for the program for startups. 
  • Accelerator to increase housing supply: Accelerator fund to encourage municipal governments to zone for more housing over the next five years. 
  • Dental-care and pharmacare: Plans to cover the cost of dental care for lower income Canadians and plans to create a national pharmacare program. 

INNOVATION INVESTMENTS

A new Canada Growth Fund to encourage private sector investment to meet net-zero climate goals and strengthen supply chains.

  • $15 billion in public capital over five years designed to incentivize private-sector investment in emissions reduction, economic diversification and supply-chain projects. The new program will  run at arm’s length from the government. It will make investments in businesses in firms for equity stakes, loan them money or issue financing guarantees. 

A new Canadian Innovation and Investment Agency to invest in innovation, research, and development.

  • The new agency, modelled after programs in Finland and Israel, will operate independently and will be funded with $1-billion in new spending over five years. Moreover, the government will consult further with Canadian and global experts in finalizing the design and mandate of the new agency. Furthers details will be announced in the 2022 fall economic and fiscal update.

INTELLECTUAL PROPERTY

The government has committed more investment into Canada’s national IP initiatives, including:  

  • A new national lab-to-market platform to help graduate students and researchers take their work to market;
  • Investment for the CanExport program to help Canadian businesses secure their intellectual property in foreign markets;
  • A new survey to assess the government’s previous investments in science and research, and how knowledge created at post-secondary institutions generates commercial outcomes;
  • Expanding ExploreIP, Canada’s intellectual property marketplace, so that more public sector intellectual property is put to use helping Canadian businesses; and,
  • Expanding the Intellectual Property Legal Clinics Program, which will make it easier to access basic intellectual property services.

SR&ED REVIEW FOR STARTUPS

A review of the scientific research and experimental development (SR&ED) tax incentive, assessing whether it’s effective in encouraging R&D that benefits Canada will be done. Additionally, the government is considering instituting a patent-box regime to ensure ideas generated domestically turn into IP that stays here.

  • Startups have long complained about the amount of paperwork involved with accessing SR&ED, and the assessment could translate to startups receiving higher payouts from SR&ED, or at least less paperwork to complete. 

SUPERCLUSTERS REBRAND

The federal government is extending Canada’s Superclusters and is rebranding it to be called Canada’s Global Innovation Clusters. The budget proposes an additional $750 million into the program over six years. 

  • The Superclusters was originally created to focus on projects leveraging plant proteins, advanced manufacturing, AI and oceans. With the rebrand, the government hopes to see the Global Innovation Clusters play a role in greater projects, such as climate change.

TAX RATE EXTENSIONS FOR SMALL BUSINESSES

Taxable capital for small businesses is increasing from $15 million to $50 million. 

  • Currently, the government taxes small businesses at a reduced rate of 9% on the first $500,000 of taxable income. However, small businesses lose the reduced rate once they hit $15 million. The new budget plans to increase the taxable income limit to $50 million. 

SUPPORT FOR SMALL BUSINESSES IN HEALTH TECH 

$30 million was committed to expand the CAN Health Network, which is a national partnership comprised of leading Canadian health organizations that work to introduce new solutions into the health care system. 

  • The government hopes to expand the program nationally to Quebec, the territories, and Indigenous communities.
Are you a founder trying to navigate the startup ecosystem? Learn more about programming the DMZ offers here.

The DMZ’s news roundup: What went down in March

Canada’s thriving tech sector, startup raises and DMZ’s Women of the Year inaugural list of winners — this is your monthly DMZ news roundup.


Power up with the DMZ’s News Roundup. Our new blog series is dedicated to providing you with a quick look back on what went down in the Canadian startup and innovation ecosystem this past month.

We’ve got you covered with the most relevant news, notable ecosystem wins, DMZ updates and more. 

Here’s a rundown of what went down.

INDUSTRY NEWS

New BDC report reveals Canadian tech sector driving growth across the economy and expects tech sector revenue to grow by 22% by 2024

The Canadian tech sector is driving growth across the economy. Experts are expecting tech sector revenue to grow by 22% by 2024. A new BDC report states that growth in the tech sector is expected to be 5.3% in 2022, and growth for the 2021-24 period is expected to be 22.4%. 

Read more here.

Export Development Canada makes pandemic investment program permanent for small- and medium-sized businesses

Export Development Canada (EDC) is making its investment matching program permanent after it was first launched as an emergency pandemic measure. The program provides up to $5-million in capital for companies that are raising funds from private investors. So far, EDC has invested $223-million in 82 companies through the program. Moreover, it aims to build a portfolio worth up to $500-million. 

Learn more here.

Canadian flag in the sky

“Y Combinator on steroids” – New security-focused tech fund

Glenn Cowan, a former member of Canada’s elite special operations unit, Joint Task Force 2, and Shopify co-founder Daniel Weinand launched a new venture capital fund aimed at financing national security startups. Cowan led high-risk military missions across the globe and recognized that special force units are the breeding grounds for new security related technologies, and are comparable to US accelerator Y Combinator. 

One9 Venture Partners launched its Special Mission Fund I, which is focused on national security and infrastructure. 

Read more here


STARTUP NEWS

Vancouver-based tech recruiter, VanHack, is supporting Ukrainian tech talent

DMZ alumni VanHack (Accelerator ‘18) is helping tech professionals from Ukraine find work. A global leader in tech recruitment, VanHack is waiving its placement fee for all Ukrainian tech hires. Plus, they are encouraging employers to donate to verified Ukrainian-based charities in lieu of its placement fees. 

Read more here.

Vanhack founder - Ilya Brotzky

Virtual Gurus Secured $8.4 Million CAD to Grow Virtual Assistant Marketplace Across North America

Virtual Gurus announced a $8.4 million CAD Series A and non-dilutive funding round to support the company’s growth. The company is a virtual assistant marketplace that focuses on supporting underrepresented individuals who have been historically overlooked for quality jobs.

Additionally, Founder and CEO Bobbie Racette is one of the first Indigenous women from the Canadian startup ecosystem to successfully raise a Series A round.

Check it out here.

Proptech startup iRestify raised $6 million CAD and announced its expansion into the United States

DMZ alumni iRestify (Incubator ‘17) announced a $6 million CAD raise to pursue expansion plans in the United States. The all-in-one technology-driven solution for building maintenance management has been adopted by Canadian property management brands Minto and Canadian Urban. 

After a successful soft launch in New York, Co-Founders Erifili Morfidis and Charlotte Gummesson are excited for further growth. 

Learn more here.


DMZ NEWS

The DMZ revealed inaugural award recipients of DMZ’s Women of the Year

All of the DMZ's Winners of the year headshots for 2022
In celebration of International Women’s Day,
the DMZ unveiled the inaugural winners of our highly anticipated annual award: DMZ’s Women of the Year. Launched this year, the award honours inspirational women in Canada’s tech and business community and highlight their outstanding accomplishments and contributions to creating impact.

Check out all award winners here

Looking for more startup ecosystem news and DMZ updates? Subscribe to our bi-weekly newsletter to stay in the know here.

NFTs for dummies: The hype, explained.

A quick crash course on how to use NFTs from start to finish.


NFTs have taken the world by storm. And while celebrities like Snoop Dog, Paris Hilton, Eminem and Emily Ratajkowski have embraced the NFT marketplace with open arms, you may still be asking yourself what the heck is a NFT?

Don’t worry — we are right there with you. 

NFTs have exploded in popularity, but there’s a lot of confusion around what they actually are. 

We thought we’d give a breakdown of what NFTs are, so our community can get in on the craze.

So, what in the world is a NFT?

NFTs, which stands for non-fungible tokens, are stored and secured on the public blockchain. They are unique tokens that cannot be changed, modified or destroyed. 

This means it’s a unique transaction that can’t be replaced with something else. Whereas fungible transactions are interchangeable, meaning you are trading money for the value of something. 

A prime example of a fungible transaction is when you purchase coffee. You pay a barista $4, and you get your latte. 

Non-fungible transactions are like sport trades. The Toronto Raptors traded DeMar DeRozan for Kawhi Leonard in 2018, which led to Toronto’s first-ever NBA title. The trade was a one-of-a-kind transaction. 

A computer screen with two people working at it

Where to start.

In order to do anything in the NFT realm, you’ll need to set up a few things: 

  • Crypto wallet: A crypto wallet will allow you to interact with the Ethereum blockchain. There are a ton of Ethereum wallets to choose from, but MetaMask is one of the most widely used wallets.
  • Cryptocurrency: There are a variety of different currencies that exist, and you’ll need to buy them to make transactions. For example, you can easily buy Ethereum directly within MetaMask, or through crypto-exchanges such as Coinbase
  • Marketplace: An NFT marketplace is the only place where you can store, buy and sell your NFTs. The most popular marketplace today is OpenSea. OpenSea also offers an easy process to create your own NFT, which is called “minting”. 

Once you’re set up with a crypto wallet, you’ll need to connect it to your marketplace. Think of this as setting up a credit card on your Uber Eats account.

What kind of NFTs should you buy?

That is completely up to you! NFTs are unique digital assets that you own, so think of it the same way you would a physical collectors item like art or a trading card — just in the digital economy. 

Types of NFTs you can buy include art, GIFs, sports highlights, video game skins and more. 

What do you do with a NFT after you buy it?

Again, that is entirely up to you! Just like you would collect art throughout your lifetime, you can collect NFTs to support creatives.

Some people will hold onto NFTs for potential long-term growth to turn a profit, whereas others actively trade NFTs to take advantage of price fluctuations. 

There’s no right or wrong answer here.

An image of the NFT collection Bored Ape Yacht Club

How much can NFTs go for?

In 2021 the NFT market grew exponentially, with trade volume at nearly $25 billion — up from $95 million in 2020. 

To put it into perspective, a popular NFT collection called the Bored Ape Yacht Club costs about 100 Etherum or over $400,000 CAD today. 

However, just a few short months ago you’d only be paying around 1 Ethereum for the NFT. Of course this is one of the space’s fastest-growing NFT collectibles, but nonetheless gives you an idea into just how much a NFT could be worth.

The future of NFTs

While many believe it’s only a matter of time before the NFT bubble pops, they’re certainly here to stay. Use cases for NFTs go far beyond just digital art and video games, and can translate to legal contracts, proof of ownership, licensing, certifying authenticity and much more.

For example, NFTS can be used for music royalties. Artists could generate royalties whenever their NFTs are traded, sold or bought and regain control over the value of their music. It’s safe to say that as our world becomes increasingly digitized, the need for digital ownership will be a growing need — a growing need NFTs can support.  

Ready to dive into NFTs?

Check out the DMZ’s Instagram to participate in our giveaway contest! 

We’re giving away 2 NFTs minted from a one-of-a-kind piece of artwork that was given to us from our partners at LAPSE Productions and created by Dreamdoodle.

Members of the LAPSE team gifting the NFT to the DMZ
Dario Nouri and Kyrill Lazarov, Co-Founders of LAPSE Productions, presenting their gift to Abdullah Snobar, the Executive Director of the DMZ, and Natasha Campagna, the Director of Marketing and Communications at the DMZ.

You can check out Dreamdoodle’s piece on OpenSea here

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