The 12th Annual RE$EARCH MONEY Conference
Budget 2013: Checking the Pulse of Canada's Innovation Policies
From Garage to Global
How to build strong innovative SMEs
in Canada
Jerome Le Corvec
April 2013
Innovation
• Do we really understand what it is?
– What are the real inputs
– What are the real outputs
• As a nation, do we have the culture
needed to innovate?
• Are we trying to fix the issue using
only action or are we really goaloriented?
• Are we replicating and implementing
the best practices that work abroad?
Imagine a cube
Imagine a cube
Innovation
USER EXPERIENCE
$
¥
€
£
Science
Technology
Design
Problem
solving
Strategy
PERCEPTION
7 Billion - Earth population
$
¥
€
£
The innovators
(individuals)
Knowledge
Soft skills /EQ
Know-how
Innovation Spirit
Creativity
Percy Spencer
Microwave oven
Stephanie Kwolek
Kevlar
The innovators
(individuals)
An innovator is an individual with the
Know-how
right
level
of
knowledge,
a deep and
Knowledge
broad level of know-how, an openmind for the unknown, fantastic
curiosity and the desire to practically
understand how things happen … and
what to do with it!
Soft skills /EQ
Innovation Spirit
Creativity
“Theory is when you know everything but nothing works.
Practice is when everything works but nobody knows why.
We have put together theory and practice: nothing is
working... and nobody knows why!”
- Albert Einstein
The innovators
(businesses)
Small Businesses
Start-ups
-10 to 75
-1 to 10
employees
employees
-Positive but
In Canada,
-Negative 95% of businesses
fragile cash flow
cash
flow
are less than 6 employees
Medium Businesses
-75 to 300
employees
-Positive and stable
cash flow
Large Corporations
-More than 300
employees
-Positive and
growing cash flow
Funding innovation
And commercial growth
Small Businesses
Start-ups
-Positive but
-Negative cash flow
fragile cash flow
-Should not impact
-Should not
cash flow
impact cash
-$200K
to $2M of the 4 stages
The
needs
offlow
-$200K to $10M
-Finance R&D allow
companies
different
growthand
the cie to exist are very-Finance
sometimes completely opposite
Medium Businesses
-Positive and stable
cash flow
-Minimal impact on
cash flow
-$500K to $20M
-Reduce cost
Large corporations
-Positive and
growing cash flow
-No impact on cash
flow
-$20M+++
-Reduce cost
Funding innovation
And commercial growth
-VCs
-BDCof money
ItFamily,
is all Friends
aboutand
the right kind
Angels
-EDC
…in the right amount -Banks
$100K to $2M
-Financing
…at the right moment
Slow
…at the
$500K to $10M
right conditionsSlow
Government
grants flow
…with
a continuous
Stock market
and funding
Institutional
SR&ED, IRAP,
investors
…and
with…minimum delays
(FAST).
FedDev,
$50K to $2M
$10M to $100M+
Ultimately, it’s all about having the ability
Slow failure.
to fail
without catastrophic
Slow
“Innovation has nothing to do with how many R&D
dollars you have. When Apple came up with the Mac,
IBM was spending at least 100 times more on R&D. It’s
not about money. It’s about the people you have, how
you’re led, and how much you get it.”
Steve Jobs — Fortune Magazine, Nov. 9, 1998
Infrastructure
Garage
Research center
Quality infrastructures are key
(Physical as well as intellectual)
Learning centers
-Secondary schools
-Colleges
-Universities
Corporate facilities
Ecosystem
Extended supply chain
Silos
Canadian
Specialty
Global
Role as
Innovation-enabler
Cultural aspects
Risk
-Positive
-Aversion
Trade
-Fast
-Active
-Slow level of innovation
A country’s
is much more a
-Neutral
-Closed
reflection of its culture, than
the level of
formal education of its population.
Security
-Personal
-Social
-Financial
Creativity
-High
-Low
Creating wealth with
innovation
With commercial
products for large
markets and with
significant value
added
Competing with the
right value $$$
Instead of the lower
cost
By growing trade
with growing
markets
-China (1.3b)
-Taiwan
-Korea
-India (1b)
Positive
impact on
populations
-Safety
-Stability
For the past 100 years wealth is traveling West
Why?
Why is it urgent to fix
Canada’s innovation and
productivity issue?
The scary picture
2012 Fall Report of the Auditor General of Canada
If we want to maintain our living standards,
our GDP will have to increase significantly
in the next 20 years.
It is a competition
It is a competition with countries
that will win better standards of
living and others that will slowly
lose their standard of living.
What do we have to fix?
And how?
• Significantly improve the size distribution
of Canadian companies (we need more
100 to 200 employee companies)
• Must understand roadblocks to innovation
and productivity increase
– Focus on Micro-level and interview all the
companies in the IRAP database
– Then connect it with the Macro-level
• Properly (qualitatively) finance innovation
– One size doesn’t fit all
– Time is of the essence
What do we have to fix?
And how?
• Improve our education system with a
balance between knowledge, knowhow, soft skills and creativity
• Inject values into Canadian culture
to be successfully innovative
(proudness, competitiveness,
speed, efficiency) Yes we can
attitude
– Showcase our successes
Questions?
Jerome Le Corvec,
President & CEO
Aonix Advanced Materials Corp.
1740 Woodroffe Ave. S. ,Building 400
Ottawa, ON K2G 3R8
Canada
Phone: +1 613 723 1001 x220
Email: jerome.lecorvec@aonixcorp.com