Canada’s innovation superclusters ready to launch

Canada is investing €630 million (C$950 million) in a string of new “innovation superclusters” to help companies turn inventions into commercial products.

The five government-designated superclusters are designed to encourage companies of all sizes to work together to boost high-growth sectors, ranging from advanced manufacturing to digital and ocean technologies. Money is expected to start flowing this autumn.

“There’s a lot going on in Canada, between companies and technical colleges, but it’s fragmented,” Jayson Myers, head of the new advanced manufacturing supercluster, told Science|Business. “Now, we’re trying to bring the whole value stream together, and government support can maximise all this potential.”

The five innovation hubs, each with a distinct focus on a key economic sector, are spaced throughout the country.

In addition to Myer’s advanced manufacturing group, based in Ontario, there is the ocean supercluster in the Atlantic provinces, artificial intelligence in Quebec, protein industries in the Prairies, and digital technology in British Columbia. Canada’s minister for innovation, science and economic development, Navdeep Bains, described the vision as a “made-in Canada Silicon Valley”.

The partnerships will get public funding of between C$150 million and C$250 million over five years, and are required to match this funding with industry money.

Playing catch up

The new policy is an acknowledgement that Canada needs to catch-up with the likes of Germany, where support for spin-outs is well established through the country’s network of Fraunhofer Institutes.

The superclusters are also partly inspired by the UK’s Catapult centres, which began in 2011 to help small science and technology firms that might otherwise have struggled due to a lack of funding, expertise or facilities.

“Our R&D spend has declined and our productivity gap with the US is growing. We’ve lost some of our largest companies,” said Myers, an economist and advisor to successive governments, who was in Brussels this week to present the concept to industry figures at a Fraunhofer-hosted event.  

In particular, Myers pointed to Nortel, the telecoms giant headquartered in Ontario that filed for bankruptcy - the largest in Canadian history – in 2009. When the company folded, Canada lost some 15 per cent of its overall business investment, Myers said.

“Then there’s [smartphone and tablet maker] Blackberry, which is no longer at the same scale as before. And a number of pharma companies are still doing research, but it’s more clinical than basic research,” he said.

It was time to try something new. “The traditional approach of supercharging start-ups has been a very challenging model for many countries,” Myers said.

“The government wants to support industry, but at the same time it is nervous of funding projects that would have been funded anyway. So our criterion is: you have to be transformative, and leave some kind of legacy.”

Myers spent 2017 building a consortium of 100 founding companies for his cluster. “We have an C$800 million commitment,” he said, counting cash and in-kind contributions. European companies are welcome to join the clusters, as long as they bring their own funding.

Myers thinks there is potential for the concept to become self-financing over time. The consortia chosen to lead the superclusters have already exceeded funding goals by raising a total of C$1.5 billion, which brings the overall investment, when combined with the government's C$950-million commitment, close to C$2.4 billion.

“I think it has broad political support; everyone realises we have to do a better job in scaling up. Politicians see opportunities for their local companies,” said Myers.  

“Of course, first, we need to be open and transparent, and demonstrate that all of this works,” he said.