With California and the subnational Canadian provinces of Quebec (since 2014) and Ontario (2018) having years ago linked their off-set carbon markets and strengthened trade, VerdeXchange’s attention pivots here to British Columbia and the Northwest of the US. Specifically, given its proximity to innovation ecosystems and venture capital in BC & the Pacific Northwest, to Foresight, Canada’s most successful clean tech ecosystem and accelerator. VX News asks Foresight’s CEO, Jeannette Jackson, to both elaborate on the nonprofit accelerator’s ecosystem-wide approach to supporting Canada’s transition to a net-zero economy through innovation and share the competitive advantages that Vancouver BC offers cleantech, agtech, and industrial innovation companies.
Jeanette, share the goals, mission, and strategies of Foresight, Canada’s most successful clean tech ecosystem accelerator.
Jeanette Jackson: Absolutely. At Foresight we’re trying to find a way to simplify bringing stakeholders together to support Canada and the world's transition to a net-zero economy through innovation. We're hyper focused on the innovation side of the equation. Essentially, what we've done with an ecosystem accelerator is we've combined all the elements of having the innovation community at the core, but making sure that industry investors, academia, government, and other associations are at the table to support five pillars of activity. Those five pillars of activity are acceleration, adoption, capital, exports, and overall ecosystem building.
On the accelerator side, I think there's an opportunity for accelerators to lean in a little bit harder in terms of making sure that the innovation community is a little more problem driven; that's something that is really part of the ecosystem building. We're not just checking the number of companies we have, it's whether these companies can really compete on a global scale.
Over on the demand side, that's where the adoption equation comes in. As part of ecosystem building, we're working with industry to identify the innovation gaps they have to reach their net zero climate targets that are more frequently mandated by the government. How can we have an open platform that allows industry to identify their gaps, so we can find the innovators that can solve these problems and have a transactional relationship?
The capital side is all about how we fund that activity. Not only does the innovation community need capital to pilot and test all of their concepts, industry also needs capital. How deep infrastructure and operational changes go will determine the amount of capital required to help those sectors transform.
On the export side, it's really about marketing and communications. If we're doing great things in Canada, let's get that recognized internationally and vice versa. Let's also acknowledge where there's some really interesting models internationally, and bring those back into Canada. That's where the last bucket of ecosystem plays a role.
You have not mentioned an intent to create industry clusters or the need to offer companies easy access to infrastructure.
If you look at traditional cluster models, I think that's been completely disrupted given COVID-19. People are changing the way that they work and move, so on the ecosystem building side, how do you keep people together to convene, collaborate, and set priorities, but still recognize that the way we're working is going to change? That's what an ecosystem accelerator does from our perspective.
Then, there's a few other nuances: how do we make sure we have talent, access to markets, and the infrastructure to validate technologies? That really requires a collective effort as one organization can't do it all. Let's pull together the stakeholders and make sure that we're all on the same page in setting priorities and getting technology to market and to scale quickly.
It sounds as if Foresight’s mission, its five pillars of activity, and execution strategies are built on the acknowledged failures over the last 20 years of other accelerators. Give some of the lessons learned that informed Foresight’s approach and organization.
I was an executive in residence at Foresight, so I had the opportunity to really mentor 25 of the ventures before taking on this role. Most accelerators really focus on the CEO and getting them trained up to pitch to investors, to understand their customer discovery process, and perhaps raise a bit of capital. In Canada, it's really awesome that we have these grant programs as well.
There were a couple of questions that always stuck out to me. Where is the engineering team, what are they doing, and does that really align with the needs of the customers that are going to pay? So, the first box that I checked when I took over this role was reflecting on the actual content in our accelerator program, making sure that we're not isolating the CEO from the rest of the team, and ensuring that they're all being lifted up through the support mechanisms.
Foresight is a nonprofit accelerator; how does being a nonprofit impact your work?
Yes, we are a nonprofit accelerator. There are a few different models, but a nonprofit accelerator is funded more so by the government, so we want to lean in and leverage that funding with industry. Foresight has been a leading accelerator in Canada doing that. While 65 percent of our funding is from the government, industry is at the table and contributing to the success of the organization and the ventures that we're trying to support. With that said, governments have traditionally looked at how many ventures, but how many high-quality ventures are there? We're really leaning in with the philosophy of not worrying so much about the number.
Elaborate on what you term your “Ecosystem approach;” and the role of industry.
The ecosystem approach to acceleration is what's enabled us to have those conversations in terms of rounding out the programming and making sure that our metrics—the key performance indicators (KPIs) that you're reflecting on as an accelerator—are in line with industry and investor expectations.
The last piece is on the demand side. How can you advise all of these ventures if you don't have deep connections with industry to provide that feedback and support? Integrating the industry connections upfront is also something that's been incorporated into this model to a further degree than any other nonprofit accelerator that we've seen.
If you back up and look at the for-profit accelerators, they're obviously incentivized quite differently. We don't take equity in the ventures, but for-profit accelerators either take equity in the ventures or have some other mechanism to benefit from the outside. We're trying to have the KPIs and the constructive criticism of innovators, entrepreneurs, and ventures as they're coming in the door, but still leveraging that government funding so that we don't have to take equity. We're really bringing that for-profit mentality to the nonprofit sector to scale going concerns.
Elaborate on your reliance on “KPI’s”.
A KPI, or key performance indicator, is a metric that you measure yourself against over a period of time based on the activities that you're doing, and usually you have a handful of them. For us, the KPIs range. Number of ventures is still a KPI for us, but how many ventures are fast tracking through the technology readiness levels at a higher speed would be a more interesting KPI. How many ventures are getting to revenue, not only the volume of the revenue but the pace? How many markets have been accessed for exports? How many jobs are created? Ultimately, what's the economic impact of all of this accelerator work? All of these different quantifiable metrics can fit into a KPI dashboard.
Illustrate for our readers the ventures that currently are in and maturing through the Foresight accelerator?
We've broken it down into a few sub-sectors. We support ventures in things like water, transportation, built environment, the resource sector, and digital clean tech as well. We're seeing more and more the opportunity for digital and data to play a role in better informing industry and innovators on what the real measurable problems are so that we can come in with solutions.
In Western Canada, we've supported many ventures in the water space, both at the early stage and the scale-up stage. Open Ocean Robotic has an autonomous vehicle that goes out into the ocean and does testing to see what's happening, so that we can see what problems need to be addressed. We also have groups like Saltworks, who are essentially desalinating water for lots of different applications, both industrial and community.
On the carbon capture and storage side, lots of really interesting things are happening there. We have folks like Carbon Engineering and Carbon Cure, who are direct air capturing and sequestering carbon into different applications.
On the transportation side, it's hard not to recognize folks like Ballard in BC. Fuel cell technology is now being expanded into so many different applications, so we're seeing lots of spin outs from the amazing work that Ballard has done on the hydrogen and fuel cell space.
In the resource sector, we're seeing a lot around digital mining and improving the processes for mining. MineSense is a great example of a mining company who has sensors on the equipment that can make their mining process much more efficient.
I'd be remiss to not include circular economy in these conversations as well and obviously, waste management, not only from a consumer perspective, but from an industrial perspective. If you're manufacturing goods and services, you always have a bit of waste. So, what do you do with that? Let's not throw it away, let's turn it into some value-added products.
I'm always baffled by the number of renewable energy companies in BC, considering we are powered by basically free hydro. There's everything from solar to wind turbines to alternative fuels to biofuels to hydrogen.
Jeanette, you began speaking about Vancouver and have moved to include Western Canada. Brief our readers on the jurisdictions served by Foresight.
We look at Canada kind of like a filing system, if you will. We started out in British Columbia, as the only sector-specific accelerator in the province, and we were working with regional accelerators to provide that clean tech expertise through our mentorship network, our executives and residents, and some of the other initiatives with industry innovation that we support.
Over time we started to get lots of interest from Alberta, Ontario, and Quebec. These ventures were applying for support, so over the last year we've navigated a growth strategy, where now the Alberta Clean Technology Industry Alliance has joined forces with Foresight to provide our programming that we're standardizing to that region as well.
Through other partnerships, because the CTO training is quite unique and how we round out a lot of the other elements of acceleration, we're actually working with other accelerators across the country to leverage Foresights intellectual property and finding different ways to collaborate and ensure that the innovation community in Canada, from a clean tech perspective, understands the resources right out of the gate that are available to them nationally. Then, they can pick and choose where it makes sense for them to lean in, scale up, and ask for support.
While we are very much Western-Canada-focused, there are some various initiatives that expand nationally. One of them was a COVID-19 program that we ran last year that was open to national ventures. We had 85 pan-Canadian cleantech ventures looking for support on things like supply chain management. We’ve all seen the amount of disruption from a supply chain perspective, so we leaned in with a whole bunch of workshops and opportunities for these peers to convene and discuss how they can each navigate a higher probability for success moving forward.
In addition to that, nationally, we are convening people from a sector perspective. We have waterNEXT, which is essentially a national network of excellence. We're accelerating in Western Canada but also providing a model of building relationships and collaborating nationally with other partners across the country.
What have you learned from these sub-national Canadian collaborations that's applicable to all accelerators?
If I was to look back pre-COVID, I would say there was still quite a bit of a competitive nature for some different groups across Canada.
The problem of supporting Canada, and essentially the global transition to a clean economy, is should we export solutions? It's so big of a problem that there really is space for everyone; we call it 'co-opetition’. You're competing for proposals and funding, but I think it's also about finding the opportunities for us to have conversations about where we can collaborate.
So, I think as a result of COVID, a lot of that competing mentality has been broken down. There's obviously a lot of resources, but I do see an opportunity for us to collaborate more, not only in the accelerator side, but on the ecosystem side.
At the end of the day, industry and investors don't really have borders. They're looking for innovators from wherever they can find the best of the best, and so if we just can be honest with ourselves and recognize that, I think we might find ourselves having different conversations about leveling everyone up as opposed to competing for the bottom line.
As you have a collaboration with Metro Vancouver and David Flaks, what are the advantages of Vancouver centering the marketplace for sustainability?
Vancouver’s definitely set itself up as a hub for sustainability. It started off probably about 12 to 15 years ago when we had quite a few venture firms—like Chrysalix, Pangea, Renewal Funds—that were very clean tech focused and identified British Columbia as a hub. So, that was a good kickstarter for attracting cleantech innovators to the region. To complement that, the mayor of Vancouver at the time said they wanted Vancouver to be the greenest city, which is a pretty lofty commitment.
When government says that, it sets the tone for what people can expect from a policy perspective and from a resource perspective. There was a natural foundation to attract innovators to the region. Building on that, BC came out with their CleanBC initiative. And, we were the first to have a pretty strong carbon tax that put BC on the map in terms of the Global Cleantech 100. Usually well over 50 percent of the Canadian ventures on that list are from Vancouver and British Columbia. And then of course, there's lots of other opportunities that we've been leaning in on with the Cascadia region as well.
A perfect segue—elaborate on the market advantages, if any, of the Cascades (BC, Washington State, and Oregon) centering a clean tech market?
Next to BC is a big mountain, right? We're kind of isolated a little bit from the rest of the country, and while we do everything we can to break down those silos, it's also very easy to look south and see that we have already natural relationships in the Cascadia region. Microsoft, Amazon, and all those big players have built offices in Vancouver. Obviously, being in the same time zone and being close in proximity— how do we leverage those relationships to add on the clean tech and sustainability file?
I've had the privilege of working with the Clean Tech Alliance in Seattle for quite some time and of course, there's E8in the region as well. Common priorities that we've identified in the region are energy, transportation, water and ag tech. Myself and Mel Clark, Executive Director of the Clean Tech Alliance, are always navigating how we profile the region more holistically and show that again, the path to net zero does not have borders like we've traditionally seen, so let's collaborate and figure out what initiatives make sense.
California, as you well know, has a carbon cap and trade market working relationship with the province of Quebec, and to some extent Ontario. Years ago, there were like conversations with British Columbia that were never perfected. But a nexus with California and its climate change regulations and markets are very much alive. What's the potential for a BC-California relationship much like what Quebec has for marketing credits?
More broadly, I'm always fascinated with how alike Quebec and BC are, at least our economies and our infrastructure. Both of us have hydro power, strong forestry sectors etc. I'd say on the finance, tax, and policy side, I'd like to think that there's an opportunity for BC to work more closely with California and Quebec to determine what model makes sense for our large emitters. We have about 125 large emitters in the province that part of the Clean BC funding that we get is there to support. With the higher mandated carbon tax, I think the government is going to be more incentivized to figure out solutions that help industry be more comfortable with the realities of that tax.
And so I think there's promise and more openness to not reinvent the model if something's working.Government sometimes struggles with that. Sometimes you see when a new government comes in, they just take a program and actually just rename it and maybe tweak a few things to give it a new flavor, but really the fundamentals are the same. I'd like to see us find ways to break down those nuances. If things are working, let's stick to them. Let's invest more in them. And this is an example with the carbon tax and cap and trade credits and stuff that we can look at the best practices. California and Quebec are examples of that. So, let's get that front and center with policymakers.
Drill down on British Columbia’s carbon tax, which has survived a number of government party changes. What's the status of it and what do your clients think of the BC carbon tax?
It’s currently at $45 per ton, but obviously at the federal level, they've mandated working our way up to $170, per ton, so that's quite a leap. As long as those tax credits are collected and they're reinvested in ways that make sense for industry, I think that there's promise there. BC’s done a pretty good job with that through the CleanBC Innovation Fund.
They're finding mechanisms that not only seed pilot projects and give industry the opportunity to de-risk some of their investments, it's also an opportunity for them to have resources to train some of those more laggard industries on understanding how innovation and this climate transition actually make us more competitive globally and improve the opportunities for our businesses. That's how I've looked at carbon tax as we don't really play much more of a role. Some ventures do base their business model on carbon taxes, others don't, and that tactic is debatable as well.
But at the end of the day, I think we all recognize there's going to be a significant tax on carbon. You have the opportunity to comply or pay, and there's going to be a natural market mechanism that comes from that.
Lastly, the US Canada border during COVID has likely been an impediment to your export strategies and the entrepreneurial strategies of your companies. What's the future hold for increasing cross border market opportunities?
I would actually comment that I think COVID in many regards has actually improved opportunities, at least between Canada and the US, by being in the same time zone. It was actually easier for Canadian ventures to connect with some of the larger corporates throughout the US and vice versa. From a business development perspective, I've heard some quite significant positives.
Where the major challenges come into play was for ventures that were using US test facilities to continue development on some of their technologies that got stalled because they couldn't access the facilities or they couldn’t get team members down there and vice versa. So, I would say it's more around the technology validation and the relationship building on the technical side. On the business side, we've heard really promising feedback.
At the end of the day though, we'll find out. The proof will be in the pudding. If more purchase orders and more revenue come into play, or if they're if they still need to see to see it to believe it or have that handshake. I'm looking forward to when I can really give someone a solid handshake after we close the deal. Even the smallest agreement, I've always had a handshake as part of it. We'll see if that comes back. But technology validation, talent, and getting the right people would be more significant barriers that we've identified than necessarily markets.