Tobias Lütke wants Canadians to aim higher.
Addressing a crowd of 500 members of Canada’s technology ecosystem during the BetaKit Town Hall on Tuesday night the CEO of Canadian ecommerce giant Shopify said the country suffers from a “go-for-bronze” culture that is often lacking in courage and ambition.
“It’s literally the same story again and again,” he said, listing off examples of Canadian exports that ultimately benefited others dating back to the country’s founding, from beaver pelts to oil and gas, insulin to artificial intelligence. “We take the thing that’s most important and send it somewhere else.”
The event, which was held at the University of Toronto’s Myhal Centre, brought together almost every major Canadian VC firm, the heads of all key tech community organizations and university technology centres, tech founders and many students and industry workers to discuss the state of innovation in Canada, and what can or should be done to support it. Attendees arrived from British Columbia, the Yukon, Alberta, Québec, and across Ontario.
“I don’t think innovation comes from government policy; governments push from behind once the markets test something of merit.”
Tobi Lütke
According to Lütke the industry’s future won’t be determined solely by government policy, Canada’s tech startups or even the public, but by all three working towards the common goal of elevating the ecosystem. “This is a common project,” he said. “Everyone agrees that Canada is a great place, so let’s go.”
Lütke, however, didn’t shy away from addressing what he felt was a misguided step by the Federal government to increase capital gains taxes, which could have significant implications for venture capitalists and startups looking to raise funds.
“It’s not about the capital gains; the capital gains is just the most obvious sign that there’s a discrepancy between what the government says it wants and what it shows it wants,” he said. “I don’t think innovation comes from government policy; governments push from behind once the markets test something of merit.”
Lütke compared the increase in capital gains taxes to levies on cigarettes to illustrate how governments typically put a higher price on activities that it wants to discourage. “To tax innovation, you’ll see the same thing,” he warned.
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That sentiment, however, wasn’t shared universally by the innovators in the room. Earlier in the evening, during a panel moderated by BetaKit editor-in-chief Douglas Soltys, serial entrepreneur Ali Asaria suggested that all the whining about capital gains was a bad look for the industry.
Referencing the hundreds of tech industry leaders who signed an open letter calling on Ottawa to reconsider the changes to the tax code, he joked, “I have never seen a community come together in such cohesion as the signatures on that petition.”
Asaria reminded the audience of the economic struggles being faced by everyday Canadians, and referenced a recent survey which found that most support the tax hike, regardless of age, geography or political affiliation.
“I don’t know if we realize how we are being perceived if we’re all coming together on this one issue,” he warned. “Tech is presenting itself as existing in a bubble.”
Jocelyne Murphy, a University of Waterloo graduate who participated in the panel, argued that the federal government was right to focus this federal budget on housing, an issue which she says is top of mind for the next generation of innovators. She also complained of a frustrating hiring landscape for new grads, referencing a six-month recruiting process for a three-month internship, and countless hours wasted unsuccessfully applying for jobs.
“Our eyes are on you, we model ourselves after you,” she said. “Show up for us in the office, advocate for us when we’re struggling, and cheer for us when we’re winning.”
Murphy asked the audience to help young Canadians rebuild the connections that were lost during the pandemic, and focus on building community. Fellow panellist and co-founder of Cohere, Ivan Zhang, agreed with that sentiment and suggested there was more that those in the room could do to make Canada a more appealing place for startups, tech workers, and venture capital investment.
He noted that before choosing where to live and work most people come up with a pros and cons list that might include things like the education system, the cost of living, or whether they have family in the country.
“Our job as an ecosystem—not just government, or venture capital, but companies, enterprises—it’s our job to increase that pros list as much as possible,” he said. “It’s hard to stay in Canada if you want to be the best in the world at something. We need to change that.”
For his part, Lütke discouraged Canadians from comparing themselves to their southern neighbours, advocating for the country to lean into what makes it unique.
“I don’t think we should make all the same choices; we should want to be distinct,” he said. “Let’s be Canada.”
All photography courtesy Mauricio J Calero for BetaKit.
