Q&A with FounderFuel GM Sylvain Carle
Sylvain Carle is a partner at Real Ventures, a seed fund in Montréal, and also general manager of FounderFuel, a start-up accelerator. He recently spoke with us about start-ups, scaling up and the tech industry in Canada.
Q: What led to the emergence of the start-up culture in Canada?
A: I’ve been doing this for 20 years now, as an entrepreneur first and now as an investor. But a big challenge of the late ’90s, early 2000s is that the economy in Canada was driven largely by natural resources, energy and the service economy. Building a start-up uses none of these three things so a lot of the structures, the program, the money has been geared to this.
It’s interesting because it’s now easier than ever to start a business and to build a minimum viable product, like a V1 or a beta of something, which means there are so many more that are being built. But still, there’s not much money in the Canadian market to fund these start-ups so there’s more competition.
Q: How would you characterize Canada’s tech start-up industry?
A: In the last five years, generally what we’ve seen in the Canadian tech ecosystem is that it looks like these companies are suddenly popping up, but they’ve been in the works for like three, five, seven years. Shopify is a ten-year overnight success, with lots of perseverance and resilience, but that’s really the case. There are companies that no one knows about in Canada, or even if they’re in Toronto or Montréal, they’re not so well-known locally, but they’re a big deal elsewhere.
It really reminds me of the music scene. Montréal is a big Indie music scene and we have amazing bands that are world-renowned. People don’t know about them in Montréal unless you’re a span of that specific genre, but they’re superstars globally. And with start-ups, we’re seeing that a little bit. It’s like the Indie side of the business: so they weren’t in the Globe and Mail, The Gazette, La Presse; they weren’t on the air on the Radio-Canada and CBC a few years ago. They were all under the radar, but now people are realizing they’re building something that’s significant, that is having an impact: they’re creating jobs, they’re spending a lot in the economy.
Q: What are some of the biggest changes you’ve seen in the Canadian start-up and scale-up ecosystems?
A: This ambition to be the best in the world at something was something that was lacking, and I’m seeing it now. The companies that I’m working with here, that are growing the fastest and achieving the most, start from the get-go with this ambition of “in this domain, in this specific domain, I’m going to be the best in the world, wherever I start from.”
The velocity, the pace has been increasing. We have now companies worth several tens or hundreds of millions of dollars that didn’t exist three years ago. If you look at the S&P 500, a hundred years ago companies there were 75-80 years old. But if you look at the top four or five biggest companies in terms of valuation and market size, market cap, Facebook didn’t exist ten years ago and they’re one of the biggest. Since technology has been eating the world, no industry is not being transformed. So that’s amazing for me.
Q: How would you describe the talent pool in Canada? What challenges do Canadian start-ups and scale-ups companies face?
A: So it was obvious for me, having had a chance to work in San Francisco for a few years recently, that the talent level was the same. The engineers, product managers, designers–we have great talent here in Canada, but we haven’t had tech start-ups as an industry to aspire to.
But that’s been changing a lot. And now, becoming an entrepreneur, joining a start-up, is a legit career choice. But it’s still a small part of the economy. I think one of our key challenges in the Canadian ecosystem is to map the potential of start-ups for people coming to the workforce, graduating.
So, I would say both upstream in terms of talent—amazing talent— and work potential, and downstream in terms of financing and acquisition. We still need to grow that second piece of the path for start-ups to be successful.
Q: How important is it for entrepreneurs to have a network of peers?
A: I think it’s really special in Montréal— the level of peer support, of community, the community sort of like bootstrapping itself. We’ve been really seeing that, a high level of generosity, of paying it forward. And that’s part of what’s accelerating this peer network of entrepreneurs: working with other entrepreneurs and helping them grow the ecosystem.
So, even though you’ve only been at it for a year or two, you’re a year or two ahead and you have a year or two of experience, for the next person who’s starting their start-up and you can tell them, “Well, that’s been my path. And maybe it doesn’t take you two years. Maybe it will take you six months because here’s a few hints.”
Q: What would you say to Canadian start-ups looking to scale on global level?
A: The start-up revolution is happening globally, and we’re super well-positioned here to just do it. We’re next-door neighbour with the US; we have great relationships with both Asia and Europe. It’s easy to project yourself as a Canadian start-up as a global company, as long as you start with that in mind. If you want to build a big Canadian company in the Canadian market, it’s really hard to change course and become an important big global company if you start with the wrong mindset.
Q: What motivates and inspires you in your work?
A: I really believe that having an economy that is built by thousands of small independent companies is a better mix than just a few big companies, where you’re more exposed to the up and downs of macroeconomics. What drives me is that someone who becomes an entrepreneur rarely goes back to an office day job. Once an entrepreneur always an entrepreneur: it changes your outlook on life, on how you help others, on your contribution in society, both economic but also in terms of social good. Seeing how entrepreneurship transforms people is probably what drives me the most.