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Google brings Chromebooks to the world (or at least more of it)

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chromebook-2012After being Amazon.com’s best-selling laptop for 149 days straight, Google is taking its Chromebook show on the road, both internationally and at home.

Today, Google and its hardware partners Acer, HP, and Samsung will begin selling Chromebooks in six new countries: Australia, Canada, France, Germany, Ireland, and the Netherlands. And in the U.S., Chromebooks will now be available at over 1,000 Best Buy stores nationally, which doubles the number of physical stores that Google’s  the-browser-is-the-operating-system laptops are sold in.

International pricing will be roughly similar to the U.S., with Canada getting Chromebooks at $250-330, and $300-350 in Australia. But expect to pay a little more in Europe — in France and Germany, they’ll start at around 300 euros, which is close to $400 U.S.

It’s not exactly $99 education pricing, but it’s still fairly cheap.

Google’s first international expansion with Chromebooks to the UK appears to have been a success. Google reported that Chromebook accounts for more than 10 percent of laptop sales in leading UK electronics retailers Currys and PC World.

Google recently released a high-end touchscreen Chromebook for $1,299, which is not being released internationally, and with HP the biggest Chromebook yet, a 14″ model.


Filed under: Business, Cloud, Gadgets, Mobile

Silicon Valley North? Canada ‘startup visa’ program could cost U.S. in war for talent

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Canada

While foreign entrepreneurs face a protracted immigration battle in the U.S., Canada has forged ahead with a new ‘Startup Visa‘ program.

Canada is not the first country to implement policy to entice foreign entrepreneurs; Australia and Chile have launched similar programs. But if accepted, those who choose to settle in a city like Montreal or Toronto will earn residency immediately, not in a few years.

This also isn’t the first time that the famously friendly country has handpicked groups deemed beneficial to the national economy. The New York Times called its relatively open policy “an experiment in designer immigration.”

Relative to its population, Canada takes more than twice as many legal immigrants as the United States.

“While we sit on our hands, our competitors around the globe are rolling out the red carpet to recruit the most talented individuals away from us,” observed Jeremy Robbins, special counsel in the office of New York Mayor Michael Bloomberg.

Foreign entrepreneurs are in demand, particularly those with engineering skills. Canadian policymakers hopes its new program will support new ventures, stimulate jobs creation, and bolster the region’s claim as a technology hub.

The visa is a pilot program, with an initial annual allotment of 2,750 visas available to entrepreneurs and their families.

Investors as well immigration authorities will vet potential immigrants for the startup visa. Eligible candidates will need to have procured a minimum of $25,000 in angel funding from an approved Canadian investor or $75,000 in venture funding. Entrepreneurs won’t be deported if their business fails.

Meanwhile, in the U.S., foreign entrepreneurs are pushing for a similar startup visa program. They say the current visa system makes it extremely difficult for them to stay here.

One such entrepreneur is Australian-born Josh Rio, who came to the U.S. on a B2 tourist visa, and is now on a B1 business visa. He’s currently working to apply for an L1, an inter-company transfer visa, which requires him to submit over 150 pages of evidence that his company is legitimate.

“Many of the things we do in startups haven’t yet garnered the respect of governments,” he said. “How dare you not have large overhead, HR departments, huge payrolls, and 4-6 weeks of paid holidays?” If Rio is granted his visa, he will need to reapply next year, and the U.S. may deny it even if his company is doing well.

Rio’s story is far from unique; often, foreign-born entrepreneurs are reluctant to tell their story to the press, and this is reinforced by legal advice to stay quiet.

“I didn’t come here for a lifestyle [as] I can have that in Australia. I came here to take advantage of the opportunities this country has, and I am willing to work my ass off for it,” said Rio, who is the founder of a social network called Sceene, and is a former professional skateboarder.

Not every entrepreneur has Rio’s conviction to remain in Silicon Valley — many are already considering the alternatives.

“The U.S. will lose the war for global talent if it does not follow suit and reform the U.S. immigration system to include a visa program for startups and foreign entrepreneurs,” said Susan J. Cohen, resident immigration expert at legal firm Mintz Levin. Cohen is “cautiously optimistic” about immigration reform in the U.S., and she has followed it extremely closely since being involved with implementing the U.S. Immigration Act of 1990.

The federal government began accepting petitions for H-1B visas, and is expected to surpass its annual limit by the end of this week. Only 65,000 visas are available for highly-skilled workers in industries like science, technology and engineering. The Senate is currently closer to an immigration plan that includes a new visa program for low-wage workers, but this would not affect startups.

With such slow-moving reform, should the Bay area’s tech community fear that its brightest minds will be wooed to Canada’s high-tech cluster of innovation, “Silicon Valley North?”

Most of the foreign entrepreneurs in Silicon Valley I spoke with say it’ll be a fallback option. They agree that the Bay Area is still unrivaled when it comes to access to venture capital and support for startups.

LawGives Tony Pieter Yerba Buena-1

LawGives founders Tony Lai and Pieter Gunst

“I can imagine a scenario where a combination of visa issues, a declining runway, and the fortune of having a Canadian investor leads us to this path, but the complexity of moving the entire business over would likely be prohibitive,” said Pieter Gunst, the Belgian cofounder of legal technology startup LawGives.org, which helps lawyers connect with paid and pro bono opportunities. Cofounder Tony Lai is British, and is also battling with visa issues.

Over in Canada, entrepreneurs and investors are excited by the opportunity to highlight the innovation that already exists in the region. Toronto, Waterloo, Montreal, and Vancouver all have strong tech ecosystems and offer advantages, such as a less competitive talent market, local developer talent, tax credits, and universal health care.

“The government is betting that these founders will go to Canada, start a business, hire a whole bunch of people and stay for the long haul,” said Atlee Clark, the executive director of C100, a nonprofit dedicated to supporting Canadian technology entrepreneurship and investment. “Jobs will be a key marker for the government in determining success,” she explained.

For Aron Solomon, an entrepreneur who runs the education innovation arm for Toronto-based MaRs, opportunities abound for more collaboration between the two regions. He suggests that entrepreneurs might relocate to Toronto and other cities, but this won’t prevent them from investment and partnership opportunities in the Bay Area.

To connect the two regions, Canada’s immigration head Jason Kenney will travel to Silicon Valley in May to meet with some of the foreign entrepreneurs who are running out of runway — and more importantly, time.


Filed under: Business, Entrepreneur

To infinity and beyond! ‘Earth video camera’ takes one giant leap forward

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Screen Shot 2013-04-03 at 12.29.17 PMFor all the people who have fantasized of seeing the earth from outer space, UrtheCast is making that dream a reality.

UrtheCast is launching the world’s first high-definition video platform of Earth, streamed live from the International Space Station. Today, “Earth’s video camera” announced a $25 million financing agreement that will bring its vision closer to a reality.

The space tech startup is working with partners from the international aerospace community to build, launch, install, and operate two cameras on the Russian segment of the ISS. The data will be downlinked to ground stations and broadcasted in near real-time, to “change the way we view the world” and provide a view “only astronauts have experienced.”

“When you begin using the platform, it will feel much like you’re interacting with a mashup of Google Earth and YouTube. You will be able to scroll, pan, zoom, and search your way around the Earth video stream, which will reveal everything from natural wonders of the world to buzzing urban centers,” the company said on its site.

Vanounver-based UrtheCast previously raised over $4.5 million in August 2012 to accelerate development of cameras and the ground station network, as well as build strategic partnerships. Once the cameras go live later this year, UrtheCast will provide an interactive platform for consumers, app developers, educators, media outlets, government bodies, humanitarian relief organizations, and environmental monitoring services.

The $25 million is the result of a reverse take-over with Longford Energy Inc. Once the deal is completed, UrtheCast will be a wholly owned subsidiary of Longford. UrtheCast’s CEO and President Scott Larson said in a statement that the transaction will provide the capital needed to execute on the business plan, and also add expertise to the team.

The platform will be open source, allowing developers to create apps based on the video data. Like stars in the galaxy, the possibilities are endless. Now if only the company name didn’t immediately call to mind “urethra.”


Filed under: Deals, Science

The ‘startup visa’: Why Canada made it a priority & why the U.S. should too

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canada

This is a guest post by Boris Wertz

On Thursday, March 28, Canada announced that a new startup visa program would begin accepting applications.

Governments can be notorious for slow change, especially in the eyes of entrepreneurs who move at an incredibly fast-pace. But Canada’s federal government moved impressively quickly to implement this new visa, which is aimed at encouraging entrepreneurs from all over the globe to call us home.

What does the startup visa accomplish?

Immigrants — who are 30 percent more likely to start a business than non-immigrants, according to the U.S. Small Business Administration – can now be fast-tracked into Canada if they receive a $200,000 investment from a designated Canadian venture capital fund or $75,000 from a designated Canadian angel investor group. This makes it much easier for entrepreneurs to avoid bureaucratic red tape and the stress of immigration status uncertainty.

But the program doesn’t just make it easier for immigrants on a financial level. It makes it easier on a volume level as well. In 2012, a mere 700 of the old startup visas were issued, while the new program has carved a path for up to 2,750 entrepreneurs to launch their startups in Canada per year.

While the Canadian government is garnering praise for making the visa a reality, the truth is that in order for the program to come to fruition, everyone had to make it a priority: government, investors, and entrepreneurs worked together for two years to make things happen. Everyone, to use startup terminology, hustled.

How Summify provided the impetus for Canada’s startup visa

But what started it all? To find the answer, look no further than a Canadian startup success story: Summify. Romanian founders Mircea Paşoi and Cristian Strat overcame everything that was wrong with Canada’s old system, creating a popular company that was acquired by Twitter for a tidy sum in January 2012.

Summify’s founders came to Canada in 2010 to start their company and were quickly backed by top-tier venture capital. Yet Paşoi and Strat — who turned down Silicon Valley jobs at Facebook and Google to build a company in Canada — could only get six-month visas, forcing them to leave and return to the country repeatedly.

They also weren’t allowed to work for their own company because the old immigration law book considered the two entrepreneurs to be potential drains on Canadian society, even though the opposite was evidently true: Summify was creating jobs in Canada and attracting significant investment.

It was their story of frustration and adversity that inspired me and other Vancouver-based entrepreneurs Danny Robinson (co-founder of Perch) and Maura Rodgers (co-founder of Strutta) to lobby for an easier way for foreign technology entrepreneurs to start their company in Canada. Fortunately for us, the government expressed strong interest to push our initiative forward.

A startup visa for the U.S.?

So now you’re wondering, what about the U.S.? Where is its startup visa? And how did Canada — a smaller nation with a less established technology ecosystem — beat its neighbor to the South on this front?

It would be easy to argue that the U.S. doesn’t need any help attracting entrepreneurs. It has Silicon Valley, which was ranked by Startup Genome as (to no one’s surprise) the world’s best startup ecosystem. Entrepreneurs from every corner of the planet are naturally drawn to the Valley. But to make that argument would be to go against the very nature which made the Valley so successful: if the US sits back and watches other countries implement startup-friendly visa programs, it’s going to get left in the dust — just like when a big company is disrupted by a scrappy startup.

Startupvisa.com, a site dedicated to raising awareness about the situation, contends that U.S. immigration policies are “now hurting our competitive edge in the global economy.”

Last year, four of the world’s five top-ranked startup ecosystems were American cities. But Canada has two cities in the top 10 (Vancouver and Toronto) and a third in the top 20 (Waterloo). If Canada continues to beat the US to the punch on important issues such as these, it won’t be long before the tables are turned.

The importance of foreign entrepreneurs building their companies in the US cannot be underestimated. Few realize that nearly half of Silicon Valley startups are founded by immigrants. Without them, the Valley would not be the world-leading startup ecosystem that it is today.

But there’s a problem — this trend is reversing. From 1995 to 2005, foreign entrepreneurs founded 52 percent of Valley startups, according to the Kauffman Foundation. Yet since then, they’ve founded just 44 percent. A startup visa would get immigrant entrepreneurship back on track and allow Silicon Valley and the rest of America to retain its competitiveness.

Unfortunately, there’s a major drag on the U.S. initiative’s progress in the form of political battles. While in Canada everyone generally agreed the startup visa was simply about improving entrepreneurship, in the US the initiative became a political issue. And we all know, things don’t usually don’t move forward so long as they’re mired in politics.

Many Americans have made the startup visa a priority, like Canadians did — just not enough of the ones who have the power to make it a reality. With the legislation already out there, foreign entrepreneurs are now stuck in limbo as it sits in the House and the Senate. At this point, they still don’t know whether politics will push it past the finish line or kill it.

In the meantime, they can always apply for a Canadian visa.

boris-wertzBoris Wertz is one of the top tech early-stage investors in North America and the founding partner of Version One Ventures. His portfolio encompasses over 40 early-stage consumer internet and mobile companies, including GoInstant (acquired by Salesforce), Indiegogo, Top Hat Monocle, Indochino, Summify (acquired by Twitter), Wattpad, Sparkbuy (acquired by Google), Julep, Suite101, Yapta, Chloe & Isabel, Edmodo, and Flurry. Before becoming an investor, Boris was the Chief Operating Officer of AbeBooks.com, which was sold to Amazon in 2008.


Filed under: Business, Entrepreneur

Toronto founders, angels, and VCs: We’re coming for you!

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toronto CN towerJunket alert!

The Ontario ministry of economic development has invited VentureBeat to check out the center of the universe, AKA, Toronto, Ontario, Canada. And I’m the lucky guinea pig.

We’ll be in Toronto from Monday to Friday this week, checking out startups like Hubba, WattPad, and Fixmo, and talking to local venture capitalists as well as angel investors. In addition, we’ll be getting an intro to quantum computing at the University of Waterloo and taking a tour of Google’s Waterloo facility, where Googlers work on Android and Chrome technology.

I’ll also be at Extreme Startups, an accelerator in Toronto that has a cohort of startups just in the middle of their program.

In between, however, it’d be great to meet a few other founders for coffee, dinner, or drinks. Or just to say hello and put a face to an email address.

Best place to get in touch with me is Twitter: @johnkoetsier.

Let’s chat!

photo credit: wvs via photopin cc


Filed under: Business, Deals, Entrepreneur

In death, BlackBerry gives life to startups in southern Ontario

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broken BlackBerryTORONTO — Best known, perhaps, for being the headquarters of BlackBerry, Waterloo is a small suburb of Toronto with a population of 98,000 in which 500 startups were born in 2012.

I’m in Ontario, Canada, on a press junket put on by the government to highlight the startup scene in Canada’s most populous province.

40-50 percent of venture capital in Canada is put to work in Ontario, which is pushing past traditional industries and looking for investment and jobs in high-growth technology-focused companies. Those traditional industries include automotive — more cars are built in Ontario than anywhere in North America, including Michigan — and financial services, which employs more people in Ontario than anywhere else in the Americas besides New York.

But the most interesting stat is about the burgeoning startup scene, particularly in Waterloo, Ontario. Toronto is the big kahuna in southern Ontario, with a population of over 2.6 million. But Waterloo is where Google, Oracle, EA, and Intel have set up offices, where BlackBerry grew from nothing to leading the smartphone industry, and where startups are popping up incredibly fast.

BlackBerry, of course, is quickly returning to nothing, but as often happens in the tech industry, the cycle of creative destruction is resulting in a whole new cohort of hot young startups.

“Waterloo and the culture of startups there is because of RIM,” John Marshall, the president and CEO of the Ontario Capital Growth Corporation says. “You’ve got kids coming up who saw their parents do it.”

While it’s a little early to call BlackBerry dead, the fact is that former Research in Motion is indeed in motion, downwards. Apple, Google, Android, and Samsung have taken over market leadership in mobile phones, and Microsoft looks to be passing BlackBerry with Windows Phone.

But the result has been a two-track acceleration of southern Ontario’s entrepreneurship engine. First, as Marshall says, new blood sees that global success is possible. And second, the high-tech workforce shed by a downsizing BlackBerry feeds the founding and growth of small startups.

That’s music to the ears of Ontario officials like Bill Mantel, the assistant deputy minister of the Ministry of Research and Development, which has invested $3.6 billion over the past decade in the startup ecosystem: R&D, seed funding, and ecosystem improvement.

“We want the world’s next biggest tech company to be built in Ontario,” Mantel says. “It’s about job growth … about half of all job growth is provided by the 3-4 percent of high-growth companies.”

That includes companies like Desire2Learn, located about 12 minutes away in Kitchener, Ontario. Desire2Learn has gone from 400 employees to 800 in a matter of months as it took the largest VC investment into a single company in Canada — $80 million — just last September, after bootstrapping for almost a decade.

The results are also visible elsewhere.

“In the StartUp Genome report from last year, Ontario had two cities in the top 20,” Mantel says. “Toronto was eighth, Waterloo was 16th, and we think Ottawa should have made the list too.”

There hasn’t really been the emergence of a BlackBerry mafia, in the sense that the PayPal mafia has kickstarted whole waves of startups in Silicon Valley. But perhaps, in a backwards sense, BlackBerry has had a similar effect in southern Ontario.

photo credit: miggslives via photopin cc

Disclosure: Ontario’s ministry of economic development paid VentureBeat’s costs to send me on this tour of Ontario companies and the venture capital scene. My coverage, however, is my own.


Filed under: Business, Deals, Entrepreneur

How Ontario plans to become the world’s top technology hub

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downtown-torontoCanadians: humble, mild, polite, with a global reputation for being non-aggressive.

Except, of course, at a hockey game. And, increasingly, in Ontario, where startups, government, industry, universities, angels, and venture capitalists are working aggressively to try to create the world’s leading technology hub.

Inside Waterloo, Ontario's new $160M center for quantum computing.
Source: John Koetsier

Inside Waterloo, Ontario’s new $160M center for quantum computing.

“We want the world’s next biggest tech company to be built in Ontario,” the most populous Canadian province’s minister of research and innovation, Reza Moridi, told a small group of journalists recently in Toronto.

That’s aggression — even if spoken in a kinder, gentler way by an urbane, mild-mannered politician.

It also might strike some as hubris, given that Ontario’s biggest technology story to date is that of a dying smartphone manufacturer, BlackBerry (formerly known as Research In Motion).

But it’s not just words, and it’s not just the government that’s behind this effort.

Ontario’s reverse brain drain

Ontario is home to about 40 percent of Canada’s population and accounts for 48 percent of Canada’s gross domestic product. It’s the fourth-largest population center in North America, after Mexico City, New York, and Los Angeles, and it produces more cars than any other region in North America, including Michigan. Ontario also has the Americas’ second-biggest financial services sector, after New York.

More to the point, it’s North America’s second-leading cluster for technology companies, after California, and has the third-largest concentration of life sciences companies on the continent.

Google bought local startup BufferBox in late 2012
Source: John Koetsier

Google bought local startup BufferBox in late 2012

The government has invested $3.6 billion in those sectors, primarily, over the last decade, with two-thirds going to research and development, and one-third focused on building the entrepreneurship ecosystem.

That money has had an impact.

For years, countries like Canada and the U.K. have complained about a brain drain, with the best talent heading stateside for more options and better pay. Not anymore. In fact, quite the reverse.

“My co-founder left Silicon Valley to come here,” Cream.hr CEO Kateline McGregor told me.

She’s starting her company at Communitech, a thriving, almost frenetic community of startups, accelerators, massive technology companies, students, and coworkers in Waterloo, Ontario. An hour’s drive up the 401 from Toronto, Waterloo is a city of 98,000 that saw more than 500 startups take root in 2012. And the massive burst of innovation has not gone unnoticed.

“Something very interesting is happening here,” Google’s top Canadian employee, Steve Woods, told me. “This area has a very high proportion of startups to population. Google loves startups … and we love to hire entrepreneurial people.”

30-google-canada

Woods himself is a Silicon Valley refugee, returning home to Canada after building several companies in the Valley. Google recruited him over the course of several years to lead its Canadian operations.

He points directly to U.S. immigration policies that pose a critical problem for both startups and large, wealthy corporations such as Google. Getting into the U.S. to build a company or join a startup is notoriously difficult and expensive.


Where Woods works: This Google office has a real fireman’s pole, slide, cattle walkway, and more (gallery)


Meanwhile, Canada has just recently taken even more steps — such as the Startup Visa — to make it simpler, quicker, and cheaper to come to Canada.

“Because of visa situations, Canada has received a disproportionate amount of the talent that is coming into North America,” Woods said.

All of that translates into a significant competitive advantage for Canadian startups and tech companies.

More education, more startups

Another competitive advantage, particularly in the Waterloo region, is the constant stream of high-quality students coming out of engineering, math, and computer science schools. I heard this ad nauseam from government representatives I met with, and credible sources in the industry confirmed it.

University of Waterloo students build startups at Velocity Garage, a for-credit accelerator-like program.
Source: John Koetsier

University of Waterloo students build startups at Velocity Garage, a for-credit accelerator-like program.

“Waterloo University produces an amazing kind of talent,” Woods told me. “It gives students a great grounding in computer science, but also by the time they graduate they’ve passed through four summers of co-op programs, so they’ve worked at Facebook, at Google, Microsoft, BlackBerry, or other companies.”

Ontario’s 44 universities produce about 30,000 computer science and engineering graduates each year, a steady flow of new talent for the province’s startups as well as established IT, life sciences, and aerospace companies.

By contrast, California — a state with about three times the population of Ontario — produces only 21,000 STEM graduates per year. The results are clear, at least for Woods.

“People that come into Google from the University of Waterloo do disproportionately well,” Woods says.

One of the meeting rooms at Communitech, a startup mecca in Waterloo, Ontario. Google also has 200 employees here.
Source: John Koetsier

One of the meeting rooms at Communitech, a startup mecca in Waterloo, Ontario. Google also has an office here.

Rob Crowe, executive-in-residence for Waterloo-based Institute for Quantum Computing, the second-largest quantum computing research center in the world, agrees.  And he points out another advantage that translates to more startups coming out of key Canadian universities.

According to Crowe, a key difference between the U.S. and Canada is that many Canadian universities have followed the European model of education-funded research and development. Essentially, professors and researchers at the University of Waterloo own any intellectual property they develop, not the institution they work and teach for. That’s an incentive for academics to put their best foot forward while on faculty, and to kickstart companies when their ideas result in a viable product or company.

“This is the university that throws off more startups than any other university in the country,” Crowe told me.

Less tax, more benefits, more investment

All of the above regional traits are excellent for students, researchers, and startups, but there’s also good news for investors. Moridi’s ministry of research and innovation has helped reduce corporate tax, while also providing significant tax credits for companies doing innovative work.

“Ontario has one of the lowest corporate tax rates in North America, at 22 percent,” says John Marshall, president and CEO of the Ontario Capital Growth Corp., Ontario’s voice in two venture funds totaling about $500 million. The funds were raised partially by government, which recently announced intentions to pump in another $50 million, but mostly by venture capitalists and institutional investors.

Google has invested significantly in Waterloo, Ontario.
Source: John Koetsier

Google has invested significantly in Waterloo, Ontario, hiring 200 engineers for its Canadian engineering headquarters.

The goal is simple: Invest in potential high-growth venture-stage startups in Ontario via a fund-of-funds approach that ensures industry participation and leadership in every specific investment. In other words, Marshall puts money into funds assembled by local VCs such as Omers, Northleaf Capital Partners, and Rho Canada. Those VCs in turn drive the actual investments into companies like Shopify, Desire2Learn (which recently closed an $80 million round), Polar Mobile, and BlueCat Networks.

“Our overall aim is to build the ecosystem for innovation,” Marshall says. “That includes the demand side, with accelerators and startups, and the supply side: seed funding, angel investors, and venture capitalists.”

The fund-of-funds strategy appears to be working. Two years ago the average fund size in Canada was $60 million, compared to $180 million in the U.S., but now the average Canadian VC fund is $90 million. Other venture entities, such as Intel Capital and Samsung Venture Investment, are following the money and making their own investments.

When that money gets into the hands of actual startups, it goes further, according to the companies I talked to. The reason is Canada’s federal and provincial research and development credits, which the Ontario government says are “among the most generous of the OECD countries.”

Ontario had 500 startups in 2012 in Waterloo alone.
Source: John Koetsier

Ontario had 500 startups in 2012 in Waterloo alone.

Taken as a whole, those credits can reduce the after-tax cost of $100 worth of R&D to just $57 for corporations and just $39 for startups.

Fixmo CEO Rick Segal, an ex-patriate American, says those tax credits are one of the key reasons he chose Toronto as the location for his latest mobile security startup. The CEO of online advertising startup Chango, Chris Sukornyk, told me the same thing.

Marshall says that the credits simply add on to a startup environment that has long stretched every single dollar as far as it can go.

“Our entrepreneurs have already been so capital efficient by necessity,” he says, adding that now that Ontario’s entrepreneurs have access to more money, they’re still using it wisely.

That capital is starting to flow more freely lately, with VC investment up in Ontario in the past few years. But startups, who benefit most from the R&D tax credits, also have additional benefits. Almost every startup that graduates from a major Canadian accelerator such as Hyperdrive and Extreme Startups in Ontario, FounderFuel in Montréal, and GrowLabs in Vancouver, gets offered a $500,000 convertible note by the Business Development Bank of Canada.

That’s cheap and none-dilutive money, and provides more runway for startups. Most of which, realistically, need more than a three-month stint in an accelerator program to become real companies.

Ambition, meet reality

There’s no doubt that Ontario is taking smart steps with the ultimate goal of dominating the business of technology. But can it really out-innovate the innovation capital of the world, Silicon Valley?

Toronto currently ranks eighth on the Startup Genome’s list of global startup ecosystems, just above another Canadian technology hub, Vancouver. Tiny Waterloo ranks 16th with its population of just under 100,000, bringing to mind Tel Aviv, the super-fertile startup ecosystem of 400,000 people that currently holds third place.

Toronto's CN Tower
Source: John Koetsier

Toronto’s CN Tower

In addition, Ontario officials quietly let me know that they believe Ottawa would have won a spot in the top 20 as well, if Startup Genome had analyzed the data just a bit differently. That would, of course, have given Ontario three cities in the global top 20.

But even considering the province’s leading contender, there’s still a long way between eighth and first. And every country in the world, seemingly, wants to follow the Silicon Valley model to the yellow brick road of employment and riches.

Few succeed.

VC investment in Canada overall is still just a fraction of that in the U.S., with about $1.5 billion invested in the entire country over all sectors in 2012, compared to $8.3 billion invested in the U.S.  in software alone, and another $6.7 billion just in web-based startups. In Ontario specifically, VC investment was just $603 million, compared to California’s U.S.-leading $14.1 billion.

And RIM, with revenues of $18 billion in fiscal 2012 dropping to $11.1 billion in fiscal 2013, is still probably the province’s biggest tech company.

That’s not a good sign.

Turning to BlackBerry for inspiration

Despite the small numbers, startups are increasingly choosing Ontario as home. Taxation and immigration policies as well as investments from blue-chip funds like Union Square and Kleiner Perkins are having a massive cumulative effect.

Even BlackBerry is feeding the culture of innovation in Ontario, despite being in what are perhaps its death throes.

Fixmo CEO Segal says BlackBerry has been an amazing influence in Ontario, and continues to be influential. “There are lots of alumni from RIM, both voluntary and involuntary,” he says with a wry grin.

Marshall says the growth of BlackBerry from nothing to its heights as the first key innovator of the smartphone revolution has had its own impact, regardless of the company’s current situation.

“Now you’ve got kids coming up who saw their parents do it,” he says. “So they believe they can do it too.”

500 new startups in Waterloo in 2012 alone attest to that fact.

In the against-all-odds world of the startup, belief is the key ingredient of success.

Image credits: John Koetsier

Disclosure: Ontario’s ministry of economic development invited VentureBeat to visit the province, and paid my expenses. My reporting, however, remains my own.


Filed under: Business, Deals, Entrepreneur, Top stories

This Google office has a real fireman’s pole, slide, cattle walkway, and more (gallery)

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3-never-seen-a-google-logo-like-thisNap rooms are so 2000s. Massage rooms are a dime a dozen. And the in-office gym has been around since at least the ’90s. So if you want to up the ante, attract the best talent, and have the most brag-worthy office in the world, you need more.

The actual, real, live fire pole
Source: John Koetsier

The actual, real, live fire pole.

Like a full regulation fire pole that people can actually use to drop down a floor. Or an officially certified slide to get down to the lobby after a long day. Perhaps a cushioned and enclosed chill room.

Or even, believe it or not, a cattle walkway.

On a recent trip through Ontario, I toured Google’s first office in Canada — and talked to the engineer who leads Google Canada, a former startup guy in Silicon Valley and native Canuck, Steve Woods. If you use mobile Gmail, a Chromebook, Google Maps, Google Calendar, or Google Fiber, there’s a good chance you’ve touched something built at Google’s offices in Waterloo, Ontario.

And if you ever get the opportunity, those offices are definitely something to touch as well.

A BufferBox for all your packages from Google's latest Canadian acquisition.

“Startups are great, because you start from scratch,” Woods says. “Startups are awful, because you start from scratch. At Google, you can literally launch a project that affects a billion people.”

That’s one reason he decided to accept Google’s offer to leave the Valley, return home, and “figure out what we should do in Canada and do it.”

In 2008, when Google opened the office, Waterloo and London were the company’s two centers of mobile excellence — likely due to Waterloo’s proximity to then-leading smartphone manufacturer BlackBerry. So Waterloo and London pioneered the mobile version of virtually every service Google offers: Maps, Gmail, Calendar, mobile search, and more. Waterloo, which now boasts about 200 engineers, also hosts the team that built Google Fiber’s user interface and critical software for the Chrome Pixel, Google’s answer to Apple’s retina display, with full touch integration.

The office is located in a formerly industrial building that once housed a tannery, believe it or not (hence the cattle walkway). Google shares it with a number of accelerators, startups, and coworking spaces that together make up Communitech, a startup mecca with strong connections to Waterloo University, angel investors, and venture capitalists.

The Googlers who work here. After a year, their drawing gets colored in.
Source: John Koetsier

The Googlers who work here. After a year, their drawing gets colored in.

Woods, whose recruiting strategy is to get ex-patriate Canadians to move back as well as to draw new talent from the nearby Waterloo University, says that it’s an attractive place for Googlers for a variety of reasons — not just the fire pole or massage room.

“There’s fewer bosses here, or at least they can’t find you,” he jokes. “At least a third of the people here have moved back from California.”

The actual cattle walkway
Source: John Koetsier

The actual cattle walkway

Woods says that Google’s most internally unpopular and controversial product ever was built in Waterloo as well: Conversion Optimizer. That’s a piece of software for advertising buyers that Google calls the “just trust us and push the button button,” which essentially hands your advertising campaign over to Google to optimize for the cheapest and most effective ads.

“It was extremely unpopular in Google,” Woods told me. “People were wondering: How much money will we lose? They were worried that advertisers would optimize their ad spend early in the month, hit their caps, and stop buying.”

Google’s known for taking risks, however, and the company ultimately decided to go ahead despite the chance it might actually lose money. Now, the product is one of Google’s most popular for advertisers, and it manages “many, many billions of dollars.”

“It took a Nobel prize-winning economist to prove that was untrue,” Woods said. “It’s great for Google, great for advertisers, and great for surfers.”

And another product Waterloo build that Woods is particularly proud of is what he calls “the largest project Google has ever done.”

It’s the first mobile search transcoder, which was an infrastructure that rendered web pages on Google’s own internal servers, decided which bits were most important for mobile phone web users, and sent only those bits. It sounds like something for the presmartphone days of historical antiquity, but not so.

“It’s still a very fast-growing project,” Woods told me. “The volume is staggering … billions of pages per day in countries in the third world, and even in the U.S., it’s still growing.”

So … why in Waterloo, Ontario?

Communitech, the community in the building that includes Google
Source: John Koetsier

Communitech, the community in the building that includes Google.

“Something interesting is happening here,” Woods says. “The university produces an amazing kind of talent … and people that come into Google from the University of Waterloo do disproportionately well.”

Worldwide, he says, Waterloo has been one of Google’ top three or four recruiting centers for some years now. And, he adds, not everyone who wants to work for Google wants to live in California.

“This area has a very high proportion of startups to population,” he adds. “Google loves startups, and we love to hire entrepreneurial people.”

Oh, and the slide?

The office has a plastic red slide down from the second-floor Google reception area to the first-floor entrance. It has a prominent sign, “For Googlers Only,” which a PR rep told me was placed there because Ontario’s provincial slide inspector (yes, they have one, apparently) raised some concerns about safety.

I was bad, however, as I frequently am, and went down the slide anyways. The PR rep forgave me, as you can see in the video below:

Image credits: John Koetsier


Filed under: Business, Dev

Flying car crashes near elementary school in Canada

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flying-car-crashA parachute-equipped flying car designed by a Florida-based company for the use of missionaries in developing countries has crashed in Canada, just feet from an elementary school about to have a sports day event.

The car is a Maverick (slogan: “the flying car that does”) and is basically an ultralight open-wheeled buggy with a cloth exterior skin and a propellor on the back. It uses a wing-style deployable parachute for lift, and costs $94,000. Development of the car was funded by the Indigenous Peoples’ Technology and Education Center, and apparently the idea is that when the road in Borneo, Tanzania, or Peru runs out, the missionary can simply fly to his or her destination.

One model of the Maverick flying car

One model of the Maverick flying car

Now, however, the company may need to revise its slogan.

Curtis Allen, a reporter for CTV News who was on the scene, told Jalopnik that the pilot took off in Vernon, British Columbia, and crashed around 8:45. He hit a school fence and — from the picture — a tree, which may have saved his life, according to Allen.

Flying cars have been in the news lately as Terrafugia, the flying car company from Woburn, MA, reported that it plans to build street-legal airplanes. The company is working on feasibility studies for the TF-X, which “will further increase the level of safety, simplicity, and convenience of personal aviation.”

It’ll need to increase the level of safety quite considerably before the FAA and other governmental organizations think it’s a good idea to give the power of flight to every yahoo with a driver’s license.

The pilot and passenger walked away from this accident, but it is just one more reason why a Jetsons-style future is — and maybe forever will be — in the future.

When I contacted the Maverick flying car company for a comment, an employee apologized and said “I don’t know anything about it.”

Image credits: Curtis Allen/Twitter, Maverick


Filed under: Gadgets, Mobile, OffBeat

Canada’s startup visa program in ‘hyperdrive’ but U.S. is ‘dysfunctional’ (interview)

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canadaGive me your smart, your educated, your startup founders yearning to build companies?

As research indicates that the U.S. is an increasingly difficult place for foreign founders to come and build companies and founders tell horror stories of the massive challenges they faced dealing with byzantine U.S. immigration policies, Canada is burnishing its reputation as open for business — and open for new residents.

Canada’s new startup visa has received a huge amount of attention in the U.S. as the the global war for talent heats up. Senators such as Jerry Moran (R-Kan.) have tried to address the situation via legislation like the Startup Act 3.0, but that’s a slim hope after deaths of 1.0 and 2.0.

Jason Kenney, Canadian Minister of Citizenship, Immigration, and Multiculturalism
Source: Wikipedia

Jason Kenney, Canadian Minister of Citizenship, Immigration, and Multiculturalism.

The Startup Visa provides immediate permanent residency in Canada if a founder meets just three criteria. An applicant must:

  1. Secure an investment from a designated Canadian VC or fund
  2. Demonstrate English language proficiency
  3. Have at least one year of postsecondary education

This weekend, Canadian member of parliament and Citizenship, Immigration, and Multiculturalism Minister Jason Kenney is in Silicon Valley promoting his country’s Startup Visa.

We chatted with Kenney about the visa’s goals, his intentions, and the U.S. immigration system.

VentureBeat: What’s the ultimate goal of the Startup Visa?

Jason Kenney: We want a pathway for the world’s best and brightest to come to Canada and to harness that drive and innovation to be at the cutting edge of the modern economy.

VentureBeat: Why are you coming to Silicon Valley right now?

Kenney: The U.S. immigration system is dysfunctional, and it’s really difficult for talented immigrants to stay in the U.S. permanently. I’m coming to further raise the profile of the program and send the message that Canada’s open for business.

If you’re a young startup entrepreneur having trouble renewing your visa, come here! We offer immediate permanent residency.

VentureBeat: What’s the response been so far?

Kenney: There’s been a great amount of interest, but we only opened for applications on April 4, so it’s too early to tell. We will issue up to 2,500 per year, but I don’t anticipate it will be fully subscribed for the first year because it’s still new.

I know there’s a huge pent-up demand in the U.S., and I think the word is going to spread virally: If you want to stay permanently in NA, think of Canada.

VentureBeat: You’re offering permanent residency to anyone in who secures an investment. What about those who fail?

Kenney: Many countries, such as Australia, only offer temporary resident status. In Canada, we’re going to give you the “green card” right up front.

We know full well the rate of failure in startups is high, but if they come up here and don’t succeed, they have demonstrated they they have high human capital. And in the long run, their chances of succeeding and building a successful enterprise are high.

We want Canada to become a magnet for people like that.

VentureBeat: Why is Canada a good place to come build a startup?

Kenney: We have really strong tech sectors in Kitchener/Waterloo, Toronto, Vancouver, Montreal, and a few other places, an increasingly strong venture capital industry, and very well-run industry associations, angel associations.

Plus, we have the lowest business taxes in the developed world, and the strongest fiscal position in the developed world.

In terms of macro-economic terms, that’s important … Canada weathered the storm of the economic downturn better than any other country.

In addition, we have an immigration system that works, which means you have access to global talent … and human capital is even more important than financial capital.

VentureBeat: Any other message for Silicon Valley?

Kenney: While here we’ll be meeting with the CEOs of many major IT companies just to emphasize what a great place Canada is to invest in.

I think we’re really going to kick this into hyperdrive.

photo credit: PhOtOnQuAnTiQuE via photopin cc


Filed under: Business, Deals, Entrepreneur

How to join the virtual march on Washington for immigration reform

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immigration americaThere’s only little more than a day left to join the virtual March for Innovation, which is digitally marching on Washington, DC to agitate for immigration reform.

There are two key problems that require immediate remediation in Congress, according to the coalition of companies, politicians, and nonprofits: jobs and fairness.

“Our outdated immigration system is costing our economy talent, jobs, and innovation, not to mention the toll it’s taking on families and potential immigrants,” the organization says. “America can’t afford to fall behind in the race for global talent — a race we’re already losing. Already, other countries have incentivized innovation and encouraged startups while we make it difficult for talented immigrants to even apply for a visa.”

That sounds like a reference to Canada, which recently created a “startup visa” that gives immigrants who are founding companies instant permanent residency and had its minister of Citizenship, Immigration, and Multiculturalism, Jason Kenney, visit Silicon Valley to drum up applicants who might be having trouble staying in the U.S.

The result could be a net drain on the American economy:

When I chatted with Kenney last week, he called the U.S. immigration system “dysfunctional.”

The U.S. has made attempts to address the situation with a Startup Act of its own, but even that would only allow founders to stay for up to three years. The March for Innovation is looking for much more comprehensive reform that would include help for undocumented immigrants already in the country.

profpic-innMarch for Immigration is supported by the Silicon Valley Leadership Group, Steve Case, Mark Cuban, Arianna Huffington, and numerous other business and technology leaders.

If you’re interested in participating, here are four things you can do to help:

  1. Tweet or Facebook your senator
  2. Spread the word on Twitter or Facebook
  3. Change your Facebook profile picture to iMarch
  4. Email your friends

The ultimate goal is immigration reform that supports innovation and delivers on the promise at the feet of the Statue of Liberty.

photo credit: gerson721 via photopin cc


Filed under: Business, Enterprise, Entrepreneur, Small Biz, Social

Vive la demo day: VentureBeat est à Montréal

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MONTREAL — I’m in Montréal, Québec at the ungodly hour of 8:20 AM EST — yeah, that’s 5:20 PST — after arriving in my ‘otel about 1 AM last night.

But it’s all good, because today is Demo Day for one of Canada’s top accelerators: FounderFuel. Last year, over 800 people attended FounderFuel’s demo day, which has become a real event in Montréal. This year, it could be even bigger as Montréal’s Startup Festival is happening this week as well, bringing well-known Valley personalities such as Dave McClure and Paul Singh to la belle province.

Nine brand-new companies will be presenting, and FounderFuel general manager Ian Jeffery says they’re better than ever before.

“I do think that we have stepped it up significantly,” Jeffery told me yesterday. “In this cohort are some of the most mature companies we’ve ever had. All nine are fantastic, but some have real revenues already, over a million downloads, and upwards of 175,000 monthly active users.”

You would expect the shepherd of a new flock of accelerator graduates to say that, but there’s evidence as well. Several of the companies have already closed their seed rounds — before Demo Day even begins. (I can’t name names before the actual event tonight.)

Here’s a quick overview of the companies presenting tonight. If there are any you’re particularly interested in, let me know in the comments and I’ll do my best to cover them individually today.

Transit App | Powering public transit
The app that simplifies public transit by empowering commuters with the information they need.
http://thetransitapp.com

Groove | Reconnect with your music
The smart music player that learns from listening habits to create the perfect playlist every time.
http://groovemusicapp.com

LoginRadius | The social sign-on API
LoginRadius is a unified social authentication API for web and mobile platforms to engage, understand, and leverage users.
http://loginradius.com

Provender | Your farmteam
The farm-to-fork online marketplace for chefs and farmers.
http://provender.ca

CrowdMedia | Reinventing news photography
A curated marketplace that captures newsworthy photos in real time for publishers.
http://crowdmedia.co

SwiftIdentity | Whoʼs next?
The API powering the next generation of secure online authentication.
http://swiftidentity.com

Instagrad | Making higher education a reality
The social fundraising platform for college and university savings.
http://instagrad.com

Dashbook | Satisfying your information craving
The platform that satisfies your information cravings by delivering the content you care about.
http://dashbook.co

Now In Store | Redesigning fashion wholesale
The wholesale marketplace that connects independent fashion designers to retailers.
http://nowinstore.com

Interestingly, one of the companies has gone from zero to paying customers within the 12-week accelerator program.

“CrowdMedia started with almost nothing,” Jeffery told me. “Now, they’ve got not only a working product, but people paying them … all in 12 weeks from idea to live product in-market with paying customers.”


Filed under: Business, Deals, Entrepreneur

SpaceX wins launch contract for largest-ever Canadian space program

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SpaceX wins launch contract for largest-ever Canadian space program
SpaceX

SpaceX announced today that it has secured the launch contract for the largest space program in Canada’s history.

While wags might wonder how big the biggest space program ever for the U.S.’s northern neighbor could possibly be, the Space Shuttle’s moveable arm is designed and built in Canada, and the world’s second-largest country by land mass has looked to satellites to provide communication capabilities for bringing its dispersed population together since 1962, when it became the third country to ever place a satellite in orbit.

The new SpaceX contract, the company’s second with Canadian space company MacDonald, Dettwiler, and Associates, is to transport three satellites to orbit in 2018.

satellite space

“SpaceX appreciates MDA’s confidence in our ability to safely and reliably transport their satellites,” Gwynne Shotwell, SpaceX’s president and chief operating officer, said in a statement. “We hope this agreement is the second of many with MDA.”

The three satellites are part of Canada’s RADARSAT Constellation Mission, which is designed to provide maritime surveillance, disaster management, and ecosystem monitoring capabilities. With the enhanced capability, Canada will be able to monitor polar ice conditions, oil pills, ship movements, forest fires, wetlands and coastal changes, and more.

Together, the three satellites will offer complete daily coverage of Canada’s 3,855,100 square miles of territory.

SpaceX said the satellites will launch on the company’s Falcon 9 rocket. The company also has a Dragon spaceship, which recently delivered ice cream and other supplies to the International Space Station, and is testing multiple other types of rockets, including a reusable self-landing Grasshopper rocket and a modified Falcon 9-R that CEO Elon Musk says has enough thrust to “lift a skyscraper.”


Filed under: Business, Gadgets, Green, Science

SpaceX launching Canada’s Cassiope weather satellite into space this Sunday

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SpaceX launching Canada’s Cassiope weather satellite into space this Sunday
Elon Musk/Twitter
DataBeat 2013
Dec. 4 - 5, 2013
Redwood City, CA
Tickets on Sale Now

Canada, we are cleared for liftoff.

SpaceX Falcon 9 rocket will launch the Cassiope satellite for the Canadian Space Agency this Sunday. Canada is launching Cassiope in an effort to unravel “the mysteries of space weather.”

The satellite is 4 feet by 6 feet and will monitor the activity of solar particles using cameras that examine auroras, spectrometers, electron imagers, radio receivers, a “flux gate magnetometer”, and other cool space stuff.  This information could help protect the Earth’s infrastructure from damaging solar storms.

Cassiope — which stands for Cascade Smallsat and Ionospheric Polar Explorer– will also carry a “technology demonstrator Cascade payload,” which will move high volume data anywhere in the world.

Cassiope is the first of three satellites that Canada is sending into orbit as part of the RADARSAT Constellation Mission, which is intended to provide maritime surveillance, disaster management, and ecosystem monitoring capabilities through an enhance polar outflow probe (ePOP).

This is the largest space launch in Canada’s history.

Together, the three satellites will offer complete daily coverage of Canada’s 3,855,100 square miles of territory, and Canada will be able to monitor polar ice conditions, oil pills, ship movements, forest fires, wetlands and coastal changes, and other things.

The three-satellite configuration is a “paradigm shift” from earlier RADARSAT missions that launched a single satellite. By distributing the capabilities of the system across multiple satellites, the CSA aims to establish a “more robust, flexible system” that can be maintained at a lower cost, and launched using smaller, less expensive launch vehicles, like the Falcon 9.

SpaceX was founded by startup superhero Elon Musk (the “real-world Tony Stark of our age“), who also founded PayPal and Tesla Motors and serves on the board of SolarCity. In 2012, SpaceX launched the Falcon 9 rocket carrying a Dragon capsule full of supplies, which became the first private unmanned spaceship in history to successfully attach to the International Space Station.

The long-term goal is send humans into space, but SpaceX is starting out by sending other things, like cargo and satellites.

Governments are historically the only entities with enough resources to fuel space missions, but Musk has changed all that. SpaceX works with governments and private organizations to help them fulfill their galactic needs.

Earlier this year, it earned a contract with Thales Alenia Space to launch Turkmenistan’s first satellite into orbit to set up a national system of satellite communications.

This will be the first launch of the latest version of the Falcon 9, with upgraded engines and stretched fuel tanks.

Falcon 9 and Cassiope were initially supposed to launch about two weeks ago, but the event was postponed. The second attempt will take place at 12 p.m. Eastern Sunday from Vandenberg Air Force Base, in California.



Canada moves to Unbundle TV channels. But do you really want that?

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Canada moves to Unbundle TV channels. But do you really want that?
TV image via Shutterstock
DataBeat 2013
Dec. 4 - 5, 2013
Redwood City, CA
Tickets on Sale Now

Back when cable visionaries foretold the age of 500 channels, did anyone ever expect they’d have to buy them in big bundles at a time? Canada is now reaching for that unrealized Promised Land, where 500 channels means 500 choices.

According to Reuters news service, the Canadian Industry Minister James Moore said Sunday that his government will soon require cable and satellite TV providers to permit channel-purchasing outside of bundles, even as some have already started offering à la carte purchasing. “We don’t think it’s right for Canadians to have to pay for bundled television channels that they don’t watch,” he said.

No pet channel?

In fact, this could be the start of a trend of increasing consumer choice, at least in Canada. That government is also investigating ways to stop airlines from overbooking flights or telecoms from charging so much for roaming.

In the U.S., Sen. John McCain (R-Ariz.) has introduced a bill that, while not requiring TV providers to unbundle, would encourage them through incentives.

But be careful what you wish for. Some industry watchers contend that unbundling would not necessarily cost less, except for the lightest viewers, because the TV providers could simply charge more for single channels. Also, there’s a question whether niche channels would survive without being carried by bundles. You may never watch The Pet Channel, but don’t you want to know you could?

Memo to TV providers: Isn’t there something between a bundle and single-channel pricing?


This is the world’s first Bitcoin ATM

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This is the world’s first Bitcoin ATM
John Koetsier

RoboCoin CEO Jordan Kelley with the world's first Bitcoin ATM

DataBeat 2013
Dec. 4 - 5, 2013
Redwood City, CA
Tickets on Sale Now

Want a coffee? Now you can pay in Bitcoin.

The world’s first Bitcoin ATM is opening for business this morning at a coffee shop in Vancouver, Canada. You can now buy, sell, and trade Bitcoin at a real, physical machine, depositing cash and checks for Bitcoin.

“This is progress … we’re bridging the gap and bringing reality to this digital currency,” Jordan Kelley, CEO of Robocoin, the company behind the ATM, told me this morning in Vancouver. ”We’re bringing it to the masses.”

RoboCoin ATM

It’s all part of Robocoin’s plan to make virtual currency Bitcoin “grandma friendly.” The company wants to make the geeky crypto-currency available to anyone, right on the street corner. The Robocoin is a full automated teller machine with biometric security — a hand scanner — that allows you to buy Bitcoin in any of 60 different currencies. It is integrated with Mt. Gox and Bitstamp, two of the premier Bitcoin exchanges, and can be placed in stores, at technology conferences, and in financial service organizations.

And yes, you can now withdraw your Bitcoin — in the currency of your country — right on the street.

Kelley said the machines are going into Canada first as a strategic decision — some of Robocoin’s top dealers (who buy and place the $20,000 ATMs) are in Canada. Robocoin machines will soon be placed into other Canadian locations in Montreal, Toronto, Calgary, and the nation’s capital, Ottawa. There’s also the small detail that Canada’s financial system is a little less onerous to navigate than that of the U.S., making regulatory approval easier to obtain.

Everyone's excited about the new ATM
John Koetsier

Everyone’s excited about the new ATM

Most of the people visiting the coffee shop seemed bemused by the newfangled device.

“What is Bitcoin?” one elderly gentleman asked me, sipping his coffee.

I’m not sure my “virtual currency that is digitally mined and without any central authority” explanation helped him all that much.

That, of course, is precisely the problem Robocoin and its dealers have faced and will continue to face. But Kelley, who likes to call Bitcoin “the people’s currency,” is confident that there is enough of an active userbase to make the Bitcoin ATM an idea whose time has come.

“It’s going to be a daily use machine,” he said. “This is really going to add liquidity to the market … providing that instantaneous access which has never happened before.”

If that’s the case, Robocoin will have to become known for safety and security — something that people want on Facebook, but demand from their financial institutions. CTO John Russell told me that none of the data the machine uses is publicly available on the Internet; it’s all transacted over a secure VPN connection.

And if someone does a smash-and-grab with a pickup truck, grabbing the entire ATM machine?

“There’s nothing stored on the device itself,” Russell told me. “We don’t save any personal or financial data.”

The ATM
John Koetsier

The ATM

The entire system has been architected not just with physical security in mind for the device, and digital security for your Bitcoin funds, but also for regulatory compliance. Bitcoin has a bad rap as being the currency of choice for illegal transactions, and Kelley is determined that Robocoin will stay aboveboard.

“It’s architected with absolute security in mind,” he told me. “And secondly, it was really built with compliance in mind … when an operator sets up shop, they have full visibility of their customers, and we’re sending them all the information necessary to adhere to their governmental regulations … to ensure there’s no trouble.”

The owner/operator of this local machine is Jackson Warren. He’ll make pennies on each transaction — as will Robocoin — and he sees big things in the future:

“When we have thousands of these things all over the world, then it’s going to really get exciting.”

That’s a sentiment Kelley echoes — and one I heard from dozens of others checking out the coffee shop.

“It’s a pretty exciting day,” Kelley told me. “I feel pretty damn good — even though I only had five hours of sleep!”

Financeit helps you buy expensive stuff you couldn’t otherwise afford

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Financeit helps you buy expensive stuff you couldn’t otherwise afford
http://venturebeat.com/2012/08/08/poshmark-showrooms/
DataBeat 2013
Dec. 4 - 5, 2013
Redwood City, CA
Tickets on Sale Now

One of the frustrating realities of life is not being able to afford everything we want or need.

Financeit‘s consumer financing platform puts big purchases like furniture, electronics, cars, and even surgery into the realm of possibility. Today the startup announced raising $13 million in its first round of funding.

Businesses use Financeit’s mobile technology to offer their customers flexible payment options. Many customers are deterred from making large purchases because they don’t have enough cash on hand, or they don’t want to spend a hefty amount all at once.

iPadScreenLRGFinanceit’s software makes it easy to create loan applications and get them approved in minutes at the point-of-sale. Using a smartphone or tablet, businesses can enter a loan request, run an instant credit check, choose a financing program, and get paid.

Customers have the choice to defer payment for up to one year from the date of purchase, or get an interest free loan on their purchase for up to two years.

Financeit’s goal is to help businesses of all sizes drive sales by removing their customers from the burden of a large upfront cost. For many people, the ability to pay over time could be the deciding factor in whether or not to make a large purchase, which would otherwise be prohibitively expensive.

Loans range from $500 to $50,000 depending on the type of purchase, and they can be paid off over a period of up to five years. Financeit claims there are no hidden or prepayment fees, and customers pay the loan back at an interest rate of 12.99%.

So go ahead, buy that Sea Doo, install that pool, get that cosmetic surgery.

Financeit is based in Toronto, Canada and has worked with nearly 3,000 merchants partners and processed more than $500 million in loan applications since it launched in 2011.

Investors in this round include TTV Capital, Inter-Atlantic Group, and Second City Capital. This money will support Financeit’s expansion into the U.S..

O Canada, did you spy on airline passengers’ metadata?

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O Canada, did you spy on airline passengers’ metadata?

If the antics of Toronto mayor Rob Ford weren’t enough, a new report about spying on airline passengers raises questions about whether Canadians fully deserve their reputations as the most trustworthy and polite people on the planet.

On Thursday, CBC News reported that a secret document revealed by Edward Snowden shows a free wireless service at an unidentified major Canadian airport was used over a two-week period by the Communications Security Establishment Canada (CSEC) spy agency to track wireless devices of thousands of airline passengers – and continue tracking them even after they left the terminal. In fact, the agency collected enough data to determine where the tracked travelers had been before they entered the terminal.

The document has some indications that the CSEC was using the data capture as a test of new software being developed with the U.S. National Security Agency.

Does it matter?

CBC cites a cyber-security expert, Ronald Deibert, who said he couldn’t “see any circumstances in which this would not be unlawful,” under Canadian law or CSEC’s mandates. The CSEC is prohibited from collecting intelligence on Canadians or anyone in that country without a court’s permission.

The CSEC said in a statement that it “is legally authorized to collect and analyze metadata” in order to “collect foreign signals intelligence to protect Canada.” Another CSEC spokesperson told the Toronto Star that the document is simply “a technical presentation between specialists exploring mathematical models.”

As with the NSA, the CSEC contends that it was capturing metadata and not the actual content of conversations. But does it matter?

A Southern California lawyer blogging under the pseudonym of Burt Likko noted in a posting last summer that he’s “less uncomfortable with the NSA using search algorithms that actually probe the content of communications than I am them conducting all this complex analysis of communications metadata,” because looking for content “has some kind of targeting to it.”

Ye olde metadata

Like textual content on a website, conversational content in a phone call is only part of the analytical gold. But as Likko points out, at least content offers a visible reason. Metadata, on the other hand, is a map to many destinations, most of which are unknown at the start.

Kieran Healy, an associate professor in sociology at Duke University, attempted a thought experiment to find out if metadata could have impacted the kind of people who went on to write the Fourth Amendment that prohibits “unreasonable search and seizure.”

Writing as a Loyalist in 1772 London, he mathematically analyzes overlapping membership metadata from various suspected organizations in the American colonies to reveal the social network of 256 social active Bostonians.

The trail eventually leads him to “the name of a traitor” — Paul Revere.

All of this, he said, is possible “from the merest sliver of metadata about a single modality of relationship between people.”

Why Canada is where smart VC money is going in 2014

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While well established startup markets outside of Silicon Valley such as New York, Boston, and Seattle are already on venture investors’ radars, a key market for technology investment opportunities that has often been overlooked is Canada and its tech hubs, including Toronto, Waterloo, Vancouver, and Montreal.

Over the past five years, significant changes have taken place in the country’s technology ecosystem and regulatory environment. They have fueled a new era of innovation, nurturing standout companies like HootSuite, Kik, and Indochino and making Canada a key market to watch.

Where Canada is leading

What makes many Canadian technology startups so attractive to investors is that the companies have sustainable business models, with real revenue and a focus on solving very large, albeit sometimes unsexy, problems.

Material exits of globally recognized Canadian technology companies have occurred over the past few years — Eloqua to Oracle for $871 million, Taleo to Oracle for $1.9 billion, and Radian6 to Salesforce.com for $326 million, among others –- with minimal awareness that these were all Canadian-founded companies.

Canada is home to many quickly growing Software-as-a-Service companies like Vidyard, a Y Combinator alum, and FreshBooks, in addition to e-commerce players such as Kobo (acquired by Rakuten for $315 million), Beyond the Rack, and Frank & Oak. Desire2Learn and TopHat are disrupting the education market, and companies like, Shopify, BuildDirect, and Tulip Retail are disrupting retail infrastructure by creating new technology platforms and data-enabled distribution systems. Software-enabled hardware startups like Bionym and Thalmic Labs are leveraging the software-enabled hardware talent from Nortel and BlackBerry to create innovative devices and services.

In fact, the recent decline of BlackBerry has released a plethora of talent –- experienced technology executives and junior engineering talent alike –- into the Canadian tech ecosystem. The fall of this one giant will plant the seeds for hundreds of others to grow.

Home-grown tech talent

Conventional wisdom in Canada held that once you were ready to scale your company, you needed to move to Silicon Valley, or just get acquired by a larger technology company.

However, that dynamic is rapidly changing, and Canada is now seeing large American technology companies setting up shop to take advantage of the country’s rich engineering talent, lower operating costs, and thriving entrepreneurial ecosystem. For example, Facebook, Amazon, Google, Twitter, and Square all have offices in cities such as Vancouver, Toronto, Waterloo, and Montreal. The presence of these world leaders in technology in Canada injects additional energy and seasoned, as well as cutting edge, expertise into the startup ecosystem.

Canada is world-renowned for its high-quality post-secondary education, with the University of Waterloo’s engineering co-op program at its core. In fact, the Waterloo area is also now home to the Perimeter Institute, a globally recognized leader in theoretical physics graduate studies and research. And while Canada has always churned out top engineering talent, today it’s also producing outstanding technical entrepreneurs.

A friendly business environment

Many of the developments in Canadian technology wouldn’t be possible without several new initiatives. One of the most important changes was the removal of Section 116 from the tax code in 2009. The Section 116 change was significant because it made a startup investment much less complex and costly for U.S. investors.

Now foreign technology venture funding, represented largely by the U.S., is flowing into Canada in large amounts. In fact, the C100, the leading Canadian technology entrepreneur association in North America, has seen more than $700 million of U.S. venture dollars invested in Canadian technology companies involved in its ecosystem over the past couple of years.

In 2013, Canada took a bold stance when it announced its Startup Visa Program. A billboard in Silicon Valley enticed with “Pivot to Canada” –- a campaign aimed at attracting foreign entrepreneurs to Canada -– and a bit of a poke in the eye to the U.S., which has struggled to pass its own startup visa program.

R&D tax credits and refunds unique to Canada help to lower the cost of starting a company. Michael Litt, the founder and chief executive of Vidyard, says that by his estimates, it is up to two-thirds less expensive to start and run a technology company in Canada versus Silicon Valley. A number of his Y Combinator cohort companies weren’t able to get nearly as far along with their businesses as he did, given the expense and competition for talent in Silicon Valley.

There is also a new generation of talent that is helping to build the startup ecosystem in Canada. Iain Klugman and his team have built Communitech in Waterloo, a massive technology hub that supports more than 700 startups and several global technology companies, along with a couple of incubators and an accelerator. And smart, driven early-stage investors like Boris Wertz of Version One Ventures, J.S. Cournoyer of Real Ventures, and Chris Arsenault of iNovia Capital, among others, have all helped to raise the bar of what success should look like for Canadian technology entrepreneurs.

Heads up, keep an eye on your northern neighbor

Canada is a tech hub worth keeping your eye on over the coming year. There’s a new generation of technology entrepreneurs dispelling the stereotype that Canadians are “too nice” to aggressively do what it takes to build a billion-dollar company.

Mike Serbinis, chief executive of Kobo, identifies with Canadian technology entrepreneurs being scrappy risk takers. He said that he feels akin to Peter Munk, who started a mining company in the middle of nowhere in Canada and built what is now the largest gold mining company in the world, Barrick Gold. Peter was a Hungarian immigrant to Canada, and a true entrepreneur who took real risks and made huge bets. As Mike sees it, Peter’s tenacity is the closest thing he can compare to what he’s done to build Kobo, which is now doing over $1 billion in revenue.

With the thriving ecosystem and regulatory groundwork developed over the past five years, along with a set of scrappy and talented technology entrepreneurs, Canada is poised to see a groundswell of category-leading technology companies emerge on the global stage in 2014 and beyond.

Katherine Barr is a general partner at Mohr Davidow Ventures and a co-chair of the C100, the leading Canadian technology entrepreneur association in North America. On Twitter, find the C100, Katherine, and Mohr Davidow.


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Why Canada just might be the future of U.S. mobile payments

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Why Canada just might be the future of U.S. mobile payments
Image Credit: PhotoQuantique

VANCOUVER — In Canada, 75 percent of major retailers accept contactless payment. In the U.S., fewer than 2 percent of retailers do the same.

“Canada is the most ready country in the world for mobile payments to take root,” Rogers Communications VP David Robinson said today at the Wavefront Wireless Summit in Vancouver. “Ten percent of domestic transactions are contactless … and that’s going up about 1 percent a month.”

Isis NFC coke machineToday, contactless payments are almost exclusively the domain of chip-and-PIN cards tapped or air-kissed to contact-free terminals. Cards equipped with RFID chips identify themselves and authorize payment in a single tap, speeding checkout and significantly increasing per-sale purchases.

But the ubiquity of contactless payment technology in Canada has paved the way for virtual wallet technologies that haven’t yet been able to take hold in the U.S.

Which is exactly what Rogers is banking on — literally. A Canadian telco that offers mobile services, Rogers recently also became a bank as part of its quest to redefine mobile shopping. It’s launching Suretap, a mobile wallet that aims to be pretty much what your “leather platform wallet” is: a collection of all the ways you might want to pay, served up as you want them, when you want them. Suretap uses NFC to be immediately compatible with all contactless point-of-sale systems, but it also uses 1D and 2D barcodes to be compatible with non-NFC systems — and other mobile phones.

Which means that most modern smartphones, with the notable exception of Apple’s iPhone, are automatically compatible.

Suretap

Above: Suretap

Image Credit: Rogers

It’s an interesting play — not least because Rogers will preload it on smartphones that it sells, or because it’s a platform that developers can hook into and build on top of via APIs — but it’s only possible because of major technology upgrades in Canada that have it ranked the second-leading national market in contactless payment, according to Juniper. That’s clearly a positive for Rogers — and the company plans to entice its existing subscribers to use Surepay via a compelling strategy:

“Suretap will be preloaded with a prepaid MasterCard to encourage trial usage,” Robinson said.

For card issuers like MasterCard and Visa, Suretap will be cheaper and faster. New cards can be provisioned at Internet speed — essentially real time with no need for manufacturing and mailing. Retailers will also see benefits, Robinson said, as they’ll be able to know who their clients are and be able to communicate with them via Suretap. And users will be able to manage all their payment processes digitally, including topping up pay-as-you-go cards, sending gift cards, and, presumably, managing allowances for kids.

As a digital payment solution, Suretap will have access and connectors to location data, identity, payments, loyalty programs, messaging, personal data, and offers and coupons. Security will be key — as will consumer awareness of what the solution can and can’t do — and an access code will protect users’ access to the app.

The APIs and third-party developers are key to Rogers’ plans, says Robinson, who seems realistic about what a major corporation can and cannot do.

“We’re a telco, we do big things well … we do little things badly.”

While Canada might be a good test market for mobile payments, the U.S. will get chip and PIN — and contactless payments — over time, Robinson said. That’ll happen for a variety of reasons, likely by 2015.

Not least of the reasons, of course, is security:

“A lot of the U.S. doesn’t support chip and pin yet … although the CEO of Target is reconsidering that,” he said with a wry smile.

A big question, however, is Apple.

Apple’s iPhone infamously does not support NFC, and although theoretically Suretap could work via 1D or 2D barcodes — or, as Google Wallet does on iPhone, with a smart plastic card that morphs into whatever credit card you want to use — in practice a mobile wallet that actually handles real payments on Apple’s platform that is not from Apple itself is likely to run into issues.

Robinson was diplomatic:

“Apple is an amazing company, but they march to the beat of their own drummer,” he said.


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