Maybe the cooler weather we’ve been having in Toronto lately is getting to me, bringing to mind the literal darker days to come as we prepare to say goodbye to sunshine-filled summer. But really, it’s the crappy last few weeks in the tech sector that’s got me feeling down. (Stick around for the silver lining).
Sampler, founded by Marie Chevrier, a rising entrepreneur whom many on LinkedIn called inspirational, shuttered operations and filed for bankruptcy last month. SkipTheDishes and its parent company laid off a combined 800 people in Canada. Tutoring platform Paper, which boomed when kids were home from school during the worst of the pandemic, cut 45 percent of its head office staff and replaced founding CEO Philip Cutler. Globally, more than 400 tech companies have let go of more than 134,000 employees this year, according to the oft-cited layoffs.fyi tracker.
We can attribute these losses to the inevitable ebbs and flows of the startup business cycle. I hit up John Ruffolo, founder of Maverix Private Equity, to get perspective on the unease I have about this—and that I’m sure many of you are also experiencing. Companies are slimming down or locking in on delivering positive unit economics, but some have had to call it a day, he said. Ruffolo offered hope and a sanguine outlook.
The silver lining of the downturn is that “it does enable both capital and human resources of those [companies] that do not survive to shift to the surviving companies, to enable those companies to become much stronger,” Ruffolo told me. “It is no different to the thinning of a forest to enable the surviving trees to stand taller.”
In the rest of this newsletter, I’ll take you on a tour of some of those trees growing taller.
Thanks for reading on and ’til next week,
Bianca Bharti
Newsletter editor
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TOP STORIES OF THE WEEK
Social Finance Fund-backed Boann reveals first investments in Canadian impact funds
Federal government-backed, Toronto-based fund-of-funds Boann Social Impact has disclosed its first 13 investments in Canadian impact fund managers.
The recipients include nine social and environmental impact-focused funds, most of which focus on investing in technology startups. This group includes Active Impact Investments, BKR Capital, Cycle H2O, InvestEco, Raven Indigenous Outcomes Funds, Renewal Funds, Sandpiper Ventures, Spring Impact Capital, and The51.
In an exclusive interview with BetaKit, Boann CEO Derek Ballantyne noted that the firm targets impact funds across Canada tackling affordability, climate, and social challenges.
Government of Canada launches consultations on Budget 2024 proposals
The Department of Finance is asking Canadians and stakeholders to share thoughts on several key proposals, including the capital gains tax changes, the Canadian Entrepreneurs’ Incentive, open banking, cleantech tax credits, and other legislative priorities first revealed in April. The window for consultations on the capital gains inclusion rate and lifetime capital gains exemption is open until Sept. 3, 2024, and the window on all other measures is open until Sept. 11.
The consultations follow months of heated debate in the Canadian tech ecosystem over the budget’s promises.
Cardata names Haywood Marsh CEO as Canadian tech executive turnover continues through the summer
Amid a year marked by significant leadership changes in Canada’s tech sector, the trend has shown no signs of slowing down over the summer.
The raft of executive changes also includes Unbounce, MindBridge, Ratehub, NowVertical, Top Hat, Untether, Cinchy, Alida, and many more.
Sonder inks Marriott licensing deal, secures additional liquidity amid continued challenges
Canadian-founded, San Francisco-based alternative lodging company Sonder Holdings has struck a series of deals to secure fresh financing and integrate its listings into hotel giant Marriott International’s system.
They come as the short-term rental provider navigates multiple challenges, including accounting issues and lawsuits, in its push to become profitable and recoup some of the stock value it has lost since its peak.
In an Aug.19 LinkedIn post, Sonder co-founder and CEO Francis Davidson called the Marriott tie-up “a pivotal moment” for the firm, which he believes stands to benefit from the larger hospitality company’s distribution network. He expects Sonder’s latest capital infusion to fuel its efforts to integrate with Marriott and continue the company’s progress towards profitability.
Two new contracts take off as SBQuantum looks to send its tech to space
Sherbrooke, Que.-based deep tech startup SBQuantum has inked new contracts with the Canadian Space Agency and the European Space Agency to test the company’s quantum sensing technology off the Earth’s surface.
SBQuantum specializes in creating sensors that use a specific type of diamonds, known as nitrogen vacancy diamonds, to measure magnetic fields with a high degree of accuracy. The company uses the quantum properties of these diamonds to develop a quantum magnetometer that can perform magnetic field analysis without requiring precise positioning.
Get ready for the BetaKit Keynote Stage at SAAS NORTH 2024
For the fourth consecutive year, the BetaKit Keynote Stage will be your front-row seat to the most compelling conversations at SAAS NORTH 2024.
As Canada’s go-to event for scaling SaaS founders and startups, SAAS NORTH has been a staple in the Canadian tech scene since 2016. This year’s conference will again take place at Ottawa’s Shaw Centre from Nov. 13–14.
The speaker lineup is already stacked with some of the biggest names in Canadian SaaS. Founders from across the country will appear at the conference, including Michael Litt of Vidyard, Stephany Lapierre of Tealbook, Andrew McLeod of Certn, Kelsey Hahn of Monark, and Passage’s Martin Basiri.
Virtual care holds the key to better employee mental health
Canada is facing a mental health crisis, with nearly half a million Canadians missing work each week due to mental health issues, costing an estimated $51 billion annually in healthcare, lost productivity, and reduced quality of life.
Teladoc Health believes technology is essential to help mitigate these numbers. For over twenty years, Teladoc Health Canada has been supporting Canadians with virtual care services including comprehensive mental health programs. It also provides remote technology devices and licensable platform services and currently supports nine million people in Canada through employers, insurers and in hospitals and health systems.
Join ALL IN 2024: The largest event dedicated to Canada’s AI
Participate in the second edition of ALL IN, the largest event dedicated to Canadian AI, happening in Montreal on September 11 and 12. Building on last year’s success, which brought together over 2,300 AI enthusiasts from around the world, leaders from all sectors will gather again this September to explore the best of Canadian AI.
Led by Scale AI, co-organized with Mila and CEIMIA, and supported by the Canadian AI ecosystem, this must-attend event unites all the community’s pillars—from those who imagine and define AI to those who build and adopt it.
Hear from over 200 speakers, discover the latest AI advancements, engage in live demos, and connect with leading AI solution providers, including Canada’s top 100 AI startups and international delegations from over 40 countries.
Funding, Acquisitions, and Layoffs
VAN – Borealis Biosciences – $202M CAD
AUS – Aalo Atomics – $27M USD
TOR – AutoTrader.ca parent to be acquired by AutoScout24
TOR – MolecuLight – $11.7M
MAR – Book4Time acquired by Agilysys for $204M CAD
MTL – YouSet – $3.5M CAD
MTL – Reliant AI – $15.4M CAD
MTL – MKB closes $145M for third cleantech fund
MIA – Tmrw – $1.8M CAD
The BetaKit Podcast
CEO roundtable: Shopify, Wealthsimple, Lightspeed, Koho, Ecobee
“The world is loopy. Everything is a cycle. Everything is a product of compounding changes.”
Summer is almost over, so hear from these Canadian tech leaders as you prepare to get back to work in September. Featuring insights from Michael Katchen (Wealthsimple), Daniel Eberhard (Koho), Dax Dasilva (Lightspeed), Stuart Lombard (Ecobee), and Tobi Lütke (Shopify).
Teladoc Health Canada releases study that shows over 78% of Canadians find accessing mental health support in the health care system a challenge
Teladoc Health Canada, a leading provider of virtual healthcare services, recently partnered with Modus Research to survey over 1,600 Canadians to shed light on the mental health needs of Canadians and the persistent challenges they face in accessing support.
Key highlights:
• 71% would be more likely stay with an employer who fully supported their mental health needs
• More than 78% who accessed mental health support report that navigating the health care system to find this support was “somewhat difficult” or “very difficult”
• 53% found it challenging to locate a professional who can effectively help them.
Of those who received care, only 28% had high levels of confidence in their diagnosis
For more information, please visit https://www.teladochealth.ca/expert-care/mental-health/
Feature image courtesy Josh Carter via Unsplash.