What’s Our Problem, Anyways? How Canada Must Solve for 'Stay-In-Canada' Innovative Solutions.
To put it another way, where are innovative Canadian companies with their proprietary inventions going when they're ready for the global marketplace? The Made-In-Canada Dilemma
The Made-In-Canada Dilemma. How what gets ‘Made-In-Canada’ doesn’t ‘Stay-In-Canada’.
By Hilary J Schmitt, BBA, SCMP
What’s Our Problem, Anyways?
How to keep innovation from being developed in Canada, with or without the help of Canadian funding, from immediately being sold to - or purchased by - by foreign entities.
Isn’t it heartbreaking the efforts being made to get Canada on the map as a Advanced Technology leader and then see our companies take what was offered, before leaving….?
To put it another way, where are innovative Canadian companies with their proprietary inventions going when they're ready for the global marketplace?
And.. Why is this happening?
Read the report:
‘A Mandate to Innovate: Strategy For a More Prosperous Canada’ May 5, 2025 By Laurent Carbonneau, CCI Director of Policy and Research
(https://www.canadianinnovators.org/content/a-mandate-to-innovate-strategy-for-a-more-prosperous-canada)
⚖️You Should Weigh In:
What do you think of the Six Recommendations by the Council of Canadian Innovators for the Canadian government?
1. Set Gov’t Procurement Targets 🎯 from Small-Med Enterprise ("SME" 🏤)
2. Implement ⏩ Forward Commitment Procurement 🪙 in Gov't🍁
3. Promote 📢 an 🤖 Innovation Procurement Standard in Gov't⚖️ ✔️
4. Prioritize Commercialization 🔝💰 in Gov't Procurement Programs
5. Use Industrial Research Assistance Program (IRAP) for Innovative Procurement 💲💫
6. Create a Federal Procurement Concierge 📝 🍁
One Question:
Would bundling a government spending initiative for funding Canadian startup IP into existing IRAP funding actually be eating away resources that companies rely upon for iterative development of new IP?
Unless there’s a monetary top-up coming, then this proposal is placing more, not less - decision making power in the hands of gov't. An act with high potential to slow down innovation and add friction to fast moving entrepreneurs.
What would a value chain consultant say....?
Hands off - let innovators do what innovators do best. Innovate.
If it isn’t broken, don’t try fixing it. And the IRAP SRED isn’t broken. Is it?
Stay in your lane. Functional collaboration and facilitation isn’t appropriation.
Allocate funds intended for direct spending by government into its own pool.
Let’s Make-It-So…,
1. that; gov't gets a dedicated allocation to spend with requirements and measures, directly related to the commercialization of new businesses....
2. that; a separate pool intended for the public sector will help with formation of newly commercialized companies via the Gov’t Canada procurement streams.
3. that; communication about how this government led startup approach will avoid making subsidized and dependent companies – those lacking product-market fit from inception, creating silo’d projects, or those which are reliant on geographic proximity to the capital for consideration
Side note:
This ‘Made in Canada’ 🍁 sentinment is often not centered in western Canadian thought, and Canadain officials raised enough questions about current practices to warrant investigative reporting on Canada’s public sector procurement practices.
This specifically refers to the ArriveCan app developer selection and subsequent contract awards involving the same vendor. (2023)
4. that; the private sector funds are kept apart. Do not remove, reduce, or complicate processes for private sector companies that are effectively administering SRED funding now.
5. that; reporting and proper management of funds is prioritized, ensuring clear and transparent evolutionary pathways from concept to contract award involving government spending on innovative startups.
To Recap, One Perspective.
To recap, more gov't control is rarely the answer – regardless the problem. And it should not be the defacto response when there are other issues.
In fact, I would argue that taking this track on-its own does nothing to resolve the main problem and may increase the lagging indicators from Canadian innovation when compared to it’s global counterparts.
That being said, must address the problem, which is; how to keep innovative “Made-In-Canada” solutions, that are developed here either with, or without the added advantage of Canadian funding and resources for startups, from immediately being sold-to, or purchased-by foreign investors.
What is Wrong With the Solution?
Gov't intervention at inception may enable more companies to develop and undergo the regulatory process of submitting Canadian IP - however it does not simplify, speed-up, or cheapen, the current process for innovative Canadian founders.
Gov't support via controlling tax dollars into a government-controlled process for research and development funding only subsidizes selected Companies and is incentivizing founders to submit to a poorly designed process (namely the protection of Canadian IP - which takes longer than global alternatives).
The proposed solution resembles a plan akin to saying, “let’s commercialize innovative Canadian IP in Canada, by throwing more money at the problem,” and then end the discussion right-there. Clearly, this will have the result of starting a few more companies, yet it will certainly have the undesired side-effect of committing more Canadian innovators to slower processing times, compared to the same company getting IP protection somewhere else, first.
Why Care?
Because velocity matters. A lot, actually.
Let me explain…
Extra time in the process means that new companies are already planning on le
ss competitive terms, it is less favorable to enter markets when demand signals have gone stale, or when it is too late to snag the first-mover advantage ....
Why not make Canada a destination rather than a temporary starting point for innovation?
Sounds like there’s no one stopping us if we do.
H.J.Schmitt, Schmitt & Company., Supply Chain Logistics Consulting Incorporated.
What’s My Opinion?
If I made one recommendation in relation to the six proposals it would be to….
Keep these two programs, namely, the public and the private financial incentives - separate and increase the total allocation dedicated to IP development for commercialization of business innovation in Canada.
But - only do this if the process itself can be made to compare and compete globally, benchmarking leaders and targeting progress within any of the following; a) number of patents filed, number of new ventures launched and retained in Canada, and other similar measures of successful Canadian development and Canadian ownership of Canadian IP.
Suggested ‘must reads’ for those who want to know more: