Why Canada’s tech sector needs to think big

Yung Wu, who has announced this is his final year as MaRS CEO, discusses how Canada can be a productivity powerhouse, why tough times create transformational ventures, and his plans for his third attempt at retirement.

Over his three decades as a serial entrepreneur and his five years as the head of the MaRS, Yung Wu has seen his fair share of economic downturns and challenges. That’s why he’s still bullish on Canada’s tech sector: some of the biggest and most valuable companies were created during hard times. And despite the economic turbulence, innovators and entrepreneurs all across the country are developing game-changing ideas — right now.

It’s critical, he says, that these innovators receive the support they need to scale their solutions. “Entrepreneurial capability, ideas and mindsets are the heart of how we achieve renewal and transformation,” says Wu. “It’s how this country can get to a knowledge-based economy and not just a resource-based economy.”

Earlier this week, Wu announced that 2023 would be his sixth and final year as CEO of MaRS. Under his tenure, the MaRS Centre in downtown Toronto has cemented its reputation as a hub where scientists, researchers and entrepreneurs rub shoulders with investors, policymakers and private sector partners to launch high-potential companies. “This is now a destination for some of the world’s most respected talent. You don’t have to go to Silicon Valley to find capital because investors are hunting for great opportunities here. As an entrepreneur, you can actually talk to policymakers and regulators — because MaRS is a deep tech kind of campus,” he says. This year, the 22-year-old organization expanded its footprint and opened the MaRS Waterfront as another one-stop-shop for innovation.

Here, Wu shares some lessons he’s learned and what it will take to convert our most promising startups into category-leading companies and industries.

Why is tech innovation so important for Canada’s success?

Back in 2017 when I joined MaRS, there was a growing ecosystem of incubators and accelerators helping young Canadian founders birth new startups. But people didn’t yet understand the economic impact of this community at scale. When you add up the work of the startups, the work around intellectual property of the large sector leaders, plus the investments in tech, innovation turns out to be the fastest growing sector in the country. It was during my time at MaRS where we really started to look at its impact. The innovation economy represents 12 percent of Canada’s GDP, 16 percent of Ontario’s GDP and is growing at three to six times the speed of any sector. That was a bit of a revelation for the innovation startup community, for policymakers and the country.

It’s a challenging time to be an entrepreneur. What’s your prognosis?

I think about life going through seven- to 10-year cycles. We are going through another big cycle change. As we emerge from a once-in-a-100-year pandemic, we find ourselves with new and ongoing challenges: geopolitical conflicts, supply chain shocks and inflation issues impacting countries everywhere, and a decrease in venture capital in the market. While there may be a higher rate of failure during times like this, it’s much easier to spot the truly transformational ventures. Now is when the most valuable and most impactful companies in the world will be built.

“The innovation economy represents 12 percent of Canada’s GDP and is growing at three to six times the speed of any sector.”

So where do places like MaRS need to focus next to keep driving impact for the economy?

In this new economic cycle it’s critical to ask ourselves: How do we help companies grow and continue to attract talent, investment and customers to create the impact that Toronto, Ontario and Canada need? Otherwise, we’re really trying to catch lightning in a bottle.

We need to shift our focus and think about intellectual property and talent as raw materials, in the same way as lumber, precious minerals, and oil and gas as resources. Adding value through commercialization is how we get to a knowledge-based economy, not just a resource-based economy. We have a critical mass of startups in our ecosystem that are able to help companies build major industries based in Canada and solve for major impacts that only Canadians can solve. Quite honestly, we punch way above our weight when it comes to availability of the intellectual property, translational research and talent that comes out of our institutions. We need to ensure we add value, commercialize and create great companies that are staying here and building industries here. If we can do that then we can inoculate Canada from the free fall in our GDP growth rate and create impact for the future of our country.

At MaRS alone, we’ve seen some 1,400 companies go from providing some 6,000 high-tech jobs to 32,600 jobs in a matter of five years. The rate at which startups convert into category-leading companies is 4.8 percent — that’s about an eight times rate of success relative to the benchmark without something like MaRS. We need to keep growing that pipeline, particularly in high-impact health and climate sectors that can counteract the effects of the economic cycle.

What would you like to see more of in the tech community?

We need to think big and back our winners. If we want moonshot companies, we need to support and invest into launchpads like MaRS — they provide an incredible opportunity for Canada to win and to win unfair advantage globally. I believe that we are now 15 to 20 years into our journey as a global innovation ecosystem. Silicon Valley has had 90-plus years. If we invest into our launchpads, which are in effect innovation infrastructure, we can be a catalyst for a multi-generational reinvestment of experience, capital and network connections. This is what will drive sustainable growth and impact, and slingshot Canada from the bottom of the OECD productivity rankings, to the top.

What lessons are you taking away from your time at MaRS?

One of my biggest learnings is that to really reach national and global scale, we need to harness all the stakeholders: policymakers, regulators, investors, entrepreneurs, scientists, researchers, institutions and ecosystem partners. I’ve been fortunate to build highly authentic and trusted relationships and I’ve come to appreciate the power of policymakers and regulators in helping to unlock scale and impact for our companies, communities and families.

What’s next for you?

I have rarely failed at anything in my life, but I have failed at retirement twice, happily. Third time’s a charm? Or a recurring pattern at play in the metaverse? Time will tell. There has been one consistent thread in my life and that is purpose and impact. To me, success is seeing teams that I have helped build go on to do bigger things, pay it forward and then go on to do even more amazing things. So, if I fail at my third attempt at retirement, it will certainly still be in and around the innovation economy. It was my purpose before coming to MaRS and it’s baked into how I think about making big impacts in the world at large.

This interview has been edited for clarity.