The money will be given to groups and companies that can persuade Ottawa they can help young, high-potential firms flourish.
OTTAWA—An $800-million commitment central to the Trudeau government’s economic growth strategy is expected to be divvied up within the next few months among groups and companies that can persuade Ottawa they’re best positioned to help young, high-potential firms flourish.
The government earmarked the cash in last year’s budget to support “innovation networks and clusters” as part of federal plans to help budding companies scale up significantly.
Ottawa hopes these firms will evolve into strong job creators and give Canada an economic boost.
The first withdrawal from the four-year program is scheduled to happen in 2017-18.
But even with this month’s release of a budget billed as a plan deep in innovation, specifics on the $800-million program will likely have to wait a little longer.
Several non-government stakeholders engaged with Ottawa say the feds appear to be finalizing the strategy of how and where the funding will ultimately be allocated.
The $800-million envelope is important for the Liberal government, which is hoping the investment will help raise the country’s long-term growth trajectory.
The Liberals have valued this approach since their days in opposition. Their 2015 election platform pledged $900 million over three years to support accelerators, incubators and clusters as a way to help innovative entrepreneurs grow their firms into global players.
Groups like the Council of Canadian Innovators, which has been actively engaged with the feds, expects the government to settle in April or May on how it would like to proceed with the $800-million plan.
Council executive director Ben Bergen, who represents tech-sector CEOs, said one challenge is that there are many ways to define a “cluster.” It can range from a university with connected companies to a string of tech firms in a given region, he said.
As an example, he pointed to the cluster of companies that formed a couple of decades ago in the region around Kitchener-Waterloo, Ont. Among them was BlackBerry-maker Research In Motion.
Bergen said his council would like to see the $800-million investment used to support clusters centred around high-growth Canadian companies, rather than ones that revolve around universities and incubators.
He argued that in the past, the institution-centred approach has not produced the outcomes governments have been looking for.
“By really focusing it on the firm rather than on…institutions or on incubators you actually give them the jet fuel that they need to go and compete globally,” Bergen said.
“There’s real economic opportunities for revenue and growth — and it’s through that commercialization that wealth is generated.
“That’s how you turn the $800 million into $8 billion.”