Innovation in Cleantech: How Canada can become a global leader
We are at a defining moment for clean technologies. Technical advances, improved affordability and growing signs of climate change are creating an urgency to move to environmentally sustainable economic activity.
Innovation in Cleantech, a new report from MaRS Data Catalyst, suggests Canada can take an outsized slice of this growing market if it is able to quickly commercialize breakthroughs and grow companies to scale.
The report compiles data from more than 300 innovative companies working with MaRS or the Ontario Network of Entrepreneurs. The report looks at the financing, development and needs of these growing companies, which are creating the next generation of clean technologies
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The findings in the report puncture some myths about Canada’s innovative cleantech industry.
Myth 1: Cleantech is only solar panels and wind farms
Producing and storing clean energy is an important part of cleantech, but the sector includes companies working in a broad range of areas. Innovative cleantech companies are developing more efficient manufacturing techniques, making cities smarter, removing water, and making agriculture more efficient.
Myth 2: Most cleantech companies are very young startups
The cleantech companies in our survey generated $264 million in revenues in 2014 and 2015 and employed more than 1,800 people. In addition, 45 per cent of those companies were more than five years old – they’re no minnows in a pond.
Myth 3: Cleantech is heavily subsidized
The cleantech firms surveyed by MaRS raised $341 million in investment, nearly 70 per cent of which came from sources like venture capital funds and angel investors. The provincial and federal governments put in 22 per cent, much of which was in the form of investments in startup companies – not subsidies.
Myth 4: There are no women in cleantech
Ok, this one is trickier. Women are under-represented in cleantech. In our survey, 17 per cent of the companies had at least one woman on their founding team. But female entrepreneurs are having a major impact throughout the industry. Take Miriam Tuerk. A 20-year veteran of tech entrepreneurship, Tuerk co-founded and is CEO of Clear Blue Technologies, a manufacturer of intelligent monitoring and control devices for smart grids. Or Jodi Glover, who is co-founder and CEO of Real Tech, which has developed a line of next-generation water quality monitors to improve drinking water safety. The challenge now to support more women to follow in their footsteps.
Myth 5: Canada is too small to grow a world-leading cleantech industry
Canada’s cleantech companies have global ambitions. Exports accounted for 62 per cent of company revenues in our data. That suggests that, with a mid-size home market, Canada’s cleantech startups think internationally from the outset and quickly learn how to compete in other markets.
We would like to thank our partners in the Ontario Network of Entrepreneurs, the Regional Innovation Centres and the MaRS Investment Accelerator Fund for sharing their data with us and making this report possible. We also thank the Cleantech Group, whose paper “Benchmarking the Canadian Cleantech Ecosystem” (May 2016) we have used for comparative statistics, and MaRS Cleantech, for providing guidance and industry expertise. MaRS Data Catalyst receives funding from the Ontario Ministry of Research, Innovation and Science and Ministry of Economic Development and Growth.