Mayor Tory’s departure, competing bids, and financial pressure on province and feds place Collision’s future in Canada in doubt

Former Toronto Mayor John Tory and Web Summit CEO Paddy Cosgrave speaking at the first Collision in Toronto in 2019.
Then-Toronto Mayor John Tory and Web Summit CEO Paddy Cosgrave speaking at the first Collision in Toronto in 2019.
Collision ups ask to north of $40 million CAD for an extended three-year stay, as five other cities vie to host the conference.

While major North American tech conference Collision has privately communicated intentions to extend its Toronto stay by at least another year, no official agreement has been reached, BetaKit has learned. Securing that agreement might be harder than in years past.

Four separate sources have independently told BetaKit that Paddy Cosgrave, co-founder and CEO of Collision and its parent company Web Summit, has communicated during recent meetings with the local tech community that Collision’s 2024 conference will take place in Toronto. Each individual who confirmed Cosgrave’s statements, under the condition of anonymity, was present at said meetings. In at least one instance, two people confirmed that Cosgrave said “yes” when asked directly whether Collision would return to Toronto in 2024.

Collision 2023’s opening night and the municipal by-election to select Toronto’s new mayor are both slated for June 26.

However, when BetaKit asked for comment, Cosgrave declined to officially confirm that the conference is coming back to Toronto next year. Reached by email, Cosgrave initially responded, “Nothing has been agreed sorry.”

Meanwhile, a City of Toronto spokesperson told BetaKit over email that the city “currently has no agreement in place with [Collision] event organizers beyond this year.”

When asked by BetaKit, former Mayor John Tory described Collision’s continued presence in Toronto as “unfinished business.”

Collision 2023, which will take place this June, is currently set to be the annual tech event’s last outing in Toronto, concluding a three-year agreement initially inked in 2018 that was extended by two years after Collision was forced to host its 2020 and 2021 conferences online due to COVID-19.

The lack of a go-forward deal comes at a time when the city’s most powerful advocate for the conference no longer has a seat at the political table. Tech-friendly Mayor Tory’s sudden departure earlier this year after admitting to an inappropriate relationship with a staffer leaves the city’s long-term commitments to tech events like Collision an open question.

Whether and how long Collision may stay in Toronto beyond this year could depend on who will lead the city next. Since Tory’s absence, Toronto has tightened its purse strings due to an ongoing and pressing budget shortfall, with Deputy Mayor Jennifer McKelvie temporarily stepping in to fill a political vacuum until the city elects a new leader. These factors, along with an increased financial ask from Collision, likely requiring support from the provincial and federal governments, may impact the conference’s continued stay in Toronto.

In the past, Collision has moved to a new city every few years, typically announcing the next location prior to, or at the beginning of, each event. This year, Collision’s opening night and the municipal by-election to select Toronto’s new mayor are both slated for June 26.

“Taking nothing for granted”

Tory was a longtime champion of Toronto’s tech community and played a leadership role in bringing Collision to the city.

During a 2018 BetaKit Podcast interview, Cosgrave said lobbying by a few different folks helped convince Collision to come to Toronto initially, crediting work by then-Mayor Tory, Canadian Prime Minister Justin Trudeau, and Techstars Toronto managing director Sunil Sharma, among others.

A source familiar with Collision’s original three-year deal with the City of Toronto told BetaKit, under the condition of anonymity, that Tory and his office were “very hands-on” in lobbying Collision and supporting the city’s bid for the conference.

That bid ultimately came from Destination Toronto, a non-profit regional tourism promotion organization funded in part by the now six-percent Municipal Accommodation Tax (MAT) that guests pay when they stay in Toronto hotels or Airbnbs. Beyond this MAT revenue, Destination Toronto is also financed by the provincial and federal governments, which fund specific projects and mandates, as well as Destination Toronto’s own membership and co-operative partnership programs.

Collision represented the highest profile component of Tory’s work to support the local tech community.

When the news that Collision was coming to Toronto in 2019 was first announced, Tory said in a statement that the conference’s decision “confirms Toronto’s status as an important innovation hub in North America.” Ahead of Collision’s Toronto debut, Tory and the city teamed up with other levels of government to send a Canadian delegation to Web Summit, Collision’s European counterpart, in Portugal in 2018 (as part of this delegation, BetaKit received paid airfare to Lisbon).

Tory repeatedly spoke at Collision and helped kick off the conference’s opening nights in Toronto in 2019 and 2022. As he previously told BetaKit, Tory was “taking nothing for granted” about Collision being in Toronto. “We want [attendees] to come away saying ‘that was the best conference I’ve ever been to. I’m coming next year and I’m bringing my friends,’” he said.

According to remarks made by Cosgrave at Collision in New Orleans in 2018, Canadian officials from the federal to the city level “were very clear that what’s of interest to them is the lasting impact of the event … [to] act as a magnet that brings companies from all over the world to Toronto.”

Collision represented the highest profile component of Tory’s work to support the tech community more broadly, which has also included taking steps to promote Toronto’s tech ecosystem and startups on the world stage and helping numerous foreign tech giants announce new Toronto offices and expansion plans. Collision is also not the only tech conference that Tory supported: during his tenure as Toronto mayor, the city helped create and back Elevate (of which BetaKit has been a longtime media and programming partner), and provided financial support to TechTO, even hosting some of the latter’s events at City Hall.

RELATED: Toronto Mayor John Tory “taking nothing for granted” when it comes to Collision in 2019

Prior to Toronto, Collision took place in Las Vegas, then New Orleans. In its 2018 pitch deck, obtained by BetaKit, Collision had a variety of asks attached to a three-year deal to move to Toronto. Per this deck, Collision sought a financial contribution of 2.5 million euros (approximately $3.8 million CAD at the time), plus funding for travel and accommodation for foreign press, speakers, and event staff, and free venue rental and internet service for each year.

Per the source familiar with Collision’s initial deal with Toronto, Collision is currently receiving around $6.5 million CAD annually from Toronto and its partners as part of a deal funded largely by Destination Toronto.

When reached via email, a Destination Toronto spokesperson declined to confirm how much financial support the organization has provided to Collision, or any details of the deal, describing its investment in the tech event only as “very similar to our investment in recruiting any large city-wide meeting or event.”

RELATED: How Justin Trudeau and a former diplomat convinced Paddy Cosgrave to bring Collision to Canada

According to a 2021 Toronto City Council decision, Toronto has allocated up to $750,000 per year out of the Economic Development and Culture base budget to Destination Toronto to cover Collision host fees and media experience support. This funding is part of a deal that, per a related City of Toronto document, also includes in-kind support in the form of free access to the Enercare Centre and dedicated support from City of Toronto staff. A City of Toronto spokesperson confirmed to BetaKit via email that Toronto contributed $750,000 towards Collision in 2019 and 2022, and is authorized to do so again in 2023.

That 2021 decision also authorized City staff to seek funding from the Ontario and Canadian governments to support Collision. However, per the City spokesperson, to date, neither the province nor the feds have provided Toronto with any direct funding to offset its contribution towards Collision.

“The City of Toronto would welcome financial support from other orders of government given Collision’s significant contribution to Ontario and Canada’s economic position, innovation ecosystems and international reputation,” the spokesperson told BetaKit.

It is worth noting that Collision’s website lists the municipal governments of Toronto, Brampton, and York Region, the Ontario Ministry of Economic Development, Job Creation, and Trade, the province of Québec, and Canada’s Trade Commissioner Service, a federal agency, as among its partners. A Web Summit spokesperson declined to clarify the nature of these relationships with BetaKit or confirm any details of its dealings with the City of Toronto and Destination Toronto.

“That is unfinished business”

As Collision’s size and impact have grown, so have the conference’s financial demands to stay in Toronto as part of another potential multi-year agreement with Destination Toronto.

A source BetaKit has confirmed is familiar with the negotiations indicated that to stay in Toronto, Collision has sought a deal worth an amount similar to what Collision’s parent company Web Summit receives from the Portuguese government to host its events in Lisbon, worth 11 million euros per year ($16 million CAD).

This approximate amount represents more than double the approximately $6.5 million CAD that Collision is receiving annually as part of its current deal. Another three-year deal would put Collision’s total ask at north of $40 million CAD.

Multiple sources indicated to BetaKit that the Conference Board of Canada, Destination Toronto, Toronto Global and Toronto Region Board of Trade have requested financial support from the Province of Ontario and the Government of Canada to keep Collision in Toronto.

A Web Summit spokesperson told BetaKit that “there are six cities, including Toronto, currently bidding for Collision.”

The Web Summit spokesperson declined to confirm Collision’s latest ask or comment on ongoing negotiations, noting, “It would not be appropriate or the place for Collision to discuss these details.” However, the spokesperson did acknowledge that “There are six cities, including Toronto, currently bidding for Collision.”

When reached by BetaKit, the City of Toronto, and Destination Toronto also declined to confirm the details of Collision’s ask to stay in the city.

Without its mayoral advocate, Toronto’s challenging budget situation could hamper deal negotiations for Collision to return. It also remains unclear whether the Government of Canada or Province of Ontario are willing to pay to help meet Collision’s asking price. BetaKit has reached out to the federal and provincial governments for comment, but neither has responded by publication time.

Toronto’s former mayor, however, did respond to a request for comment from BetaKit. Tory emphasized the need for Toronto to keep Collision in Toronto, and noted that he’s willing to help “in any way I possibly can.”

“I believe that Collision is very important to Toronto at the same time as I believe Toronto is important to Collision,” said Tory. “That is why I worked very hard before I stepped aside to confirm Collision in Toronto for several more years. That is unfinished business.”

“It is important the other governments (federal and provincial) recognize that Collision is important and step up in a meaningful way,” said Tory. “And it is important for Toronto to stay the course.”

A Collision sign ahead of the start of Collision 2022 in Toronto.
A Collision sign ahead of the start of Collision 2022 in Toronto (Vaughn Ridley/Collision via Sportsfile).

Other local advocates seem unified in the desire for provincial and federal support to keep Collision in Canada. A December 2022 letter obtained by BetaKit, signed by the heads of 20 chambers of commerce and boards of trade across Ontario, as well as the chairs of the Toronto-Waterloo Innovation Corridor Business Council, argued that renewing Collision “should be a priority for the Provincial and Federal governments.” The letter, which was addressed to the Collision Renewal Committee, described Collision as “essential to the fabric of businesses and the business community right across the Corridor.”

“Critically, we see it as an important part of our region’s post-pandemic economic revitalization,” argues the letter. “It authenticates our status and raises our profile as a global innovation centre, delivering a global gathering place that showcases our new economy leaders. Put simply, Collision is the TIFF for technology and innovation.”

Another December 2022 letter obtained by BetaKit, signed by mayors and chairs of municipalities from across Ontario—including former Mayor Tory—reiterates these sentiments. This letter, addressed to the Government of Canada and the Government of Ontario, expresses support for a “multi-year renewal” of Collision in Toronto, which it claims is the only Canadian city that meets Collision’s hosting requirements and called on the feds and the province to aid efforts to keep the “mission critical initiative” in Canada.

Destination Toronto claims that during its 2019–2023 stay in Toronto, Collision will fuel a total of $119 million in direct spending and $188 million in economic impact.

The letter argues that Collision “provides a strategically important global platform” for showcasing Canadian tech companies and “shines a spotlight” on the country’s innovation ecosystem. “That spotlight is of critical importance as we compete in an increasingly competitive, post-pandemic environment with jurisdictions around the world to attract and retain tech businesses and jobs.”

When Collision first launched in Toronto in 2019, the conference had nearly 26,000 attendees. Last year, the event served over 35,000 people from 130 countries and 1,557 startups from 74 countries.

According to the letter from municipalities, Collision brought $43 million in direct spending and generated $68 million in economic impact, including $5.7 million in provincial and $4.3 million in federal tax revenue in 2022.

As the letter notes, Collision’s impact also stretches past just direct spending by attendees, as the event is a place “where innovation deals are made, and future partnerships are struck,” serving as a catalyst for investments and growth opportunities for Canadian businesses.

Though Collision hosts far fewer attendees in total than these other major annual Toronto events, the above figures indicate that Collision has a smaller but similar impact on the economy as TIFF and Pride.

According to Infrastructure Ontario, TIFF generates $170 million in annual economic impact, while the Government of Canada claims that the 11-day international film festival brings more than 700,000 visitors to Toronto and accounts for more than $114 million in economic activity in the region. Per Pride Toronto’s most recently available Economic Impact Report, the month-long annual 2SLGBTQ+ festival hosted over 1.7 million attendees and contributed an estimated $374 million to Ontario’s GDP, generating $149 million in combined tax revenues, in 2019.

A photo illustrating Collision's economic impact in Toronto since 2019.
The economic impact of Collision during its 2019–2023 stay in Toronto (Destination Toronto).

Destination Toronto shared data with BetaKit indicating that in 2019 and 2022, Collision fuelled a combined $70 million in direct spending from attendees and $111 million in economic impact. In 2023, the organization projects that the event’s impact will only grow, reaching 40,000 attendees and generating $49 million in direct spending and $77 million in economic impact—for a total of $119 million in direct spending and $188 million in economic impact over three years.

A Destination Toronto spokesperson noted that these figures only indicate the impact of the event itself, and not “the very real and substantive long-tail impact of events like Collision on the overall vibrancy of our local and regional economy.”

For his part, Tory maintained his belief that Collision should remain in Toronto. “While we can be proud of Elevate, I want Elevate AND Collision,” he said. “We need both. Both need us.”

“To me, this is a marriage made in heaven and while we have been married for a while already, it’s time for a second honeymoon.”

“Put some cash on the table”

A source BetaKit spoke with, who attended one of the aforementioned meetings with Cosgrave, said that leading up to the gathering, it initially sounded like Collision was on track to reach either another long-term contract with Toronto, or else leave the city. But instead, the source said Cosgrave told the group in attendance that Collision was set to return on a “one-year bridge.”

“That kicking the can down the road [at the City of Toronto] is happening on all fronts,” said the source, regarding Toronto’s current leadership vacuum. “All that stuff trickles down to things like Collision. Decisions are being deferred.”

Fellow Toronto tech events Elevate and TechTO both declined to comment to BetaKit on their current relationship with the City of Toronto following Mayor Tory’s departure and if it had changed since he left office. However, TechTO co-founder and managing director Alex Norman told BetaKit, “We would hope that any future Mayor would feel the same way and we look forward to working with whoever takes office.”

RELATED: Collision’s Paddy Cosgrave talks Shopify, tech downturns, and meaningful connections

One Toronto-based tech event organizer, speaking with BetaKit under the condition of anonymity, said that the City of Toronto’s interest in supporting tech and innovation events has dwindled lately.

“We’ve seen the City pull back its funding for tech and innovation events at a time we feel is critical to be able to provide the ecosystem with support and connectivity,” said the source. “It certainly appears that municipal interest to support homegrown and local initiatives that operate, employ, and have impact year-round is diminishing.”

The lack of a long-term commitment to Toronto could also hurt Collision in the short term.

“The feds and the province need to step up and put some cash on the table if the event’s going to stay in Canada.”

The tech organizer who spoke to BetaKit under the condition of anonymity also noted that many of their shared event partners have told them that the lack of a multi-year commitment to Collision in Toronto would leave them less interested in sponsoring Collision this year. This points to one possible motivation as to why Cosgrave might want to communicate future agreements with Toronto that are as-yet unsigned or unannounced.

The source familiar with Collision’s original deal with Toronto, however, told BetaKit they are confident that the two parties will reach an agreement for the conference to return in 2024, and suspects that negotiations for a stay beyond that will continue.

According to the source, while Mayor Tory’s sudden departure may have impacted negotiations between all three levels of government, Toronto’s current leadership situation or budgetary issues are not preventing a longer-term deal between Collision and the city. Rather, the source believes that the lack of commitment from the Province of Ontario and the Government of Canada is holding things up, and doubts another multi-year agreement would be possible without them.

“The blocker at the end of the day is that Collision wants a lot more money than what they got before,” said the source. “To do that, ultimately … the feds and the province need to step up and put some cash on the table if the event’s going to stay in Canada.”

The Destination Toronto spokesperson declined to comment on ongoing negotiations in detail, confirming to BetaKit only that the organization received a request for proposal and is continuing to work with the Collision team to try and keep the conference in Toronto.

“We feel our city, province, and country would continue to see enormous benefits from remaining,” the Destination Toronto spokesperson told BetaKit.

Collision CEO’s behaviour could complicate negotiations

Toronto’s new leader will help dictate how much attention and support the city pays to the innovation community, as well as how it invests in both homegrown tech events and foreign entrants alike. A shifting political focus could also impact how much the governments of Ontario and Canada are willing to pay, if anything, to ensure Collision stays in Toronto. One factor that could influence the decision may be the behaviour and reputation of those making the ask.

After Cosgrave denied that Collision and the City of Toronto had reached an agreement for 2024, BetaKit informed Cosgrave that multiple sources had stated otherwise—claiming he said that Collision would be returning. He was then asked for clarification. Cosgrave then questioned BetaKit’s journalistic integrity, levying a false allegation and a couple of associated insults toward the publication and its journalists. Given that Cosgrave is a notable public figure responsible for a major international tech event produced in partnership with three levels of government, BetaKit has included and addressed Cosgrave’s additional comments below.

“Ughhh don’t you guys take cash in return for “stories,”” Cosgrave said in response to BetaKit’s question, “If you’re doing some sort of phishing for cash we’re not interested.” In a subsequent follow-up email shortly thereafter, Cosgrave added, “wait that is you guys. You are total scumbag “journalists”… creeps.”

When given the chance to clarify these comments for this story, Cosgrave stood by his original comments and added, “I don’t engage with dishonest journalists.”

A Web Summit spokesperson denied the allegations about Cosgrave, calling the claims “baseless and without merit.”

For the record, BetaKit has never accepted cash or any other form of compensation in exchange for news stories. Like many other media publications, BetaKit does produce paid, clearly labelled sponsored content put together by non-editorial team members. However, this content, and BetaKit’s commercial interests more broadly, do not inform or interfere in any way with the publication’s journalism.

Others have made allegations about Cosgrave’s professional conduct in the past.

Per Irish media reports, Cosgrave has both sued and been sued by former Web Summit colleagues in a number of different lawsuits claiming breach of fiduciary duty, minority shareholder oppression, breach of a profit-sharing agreement, and defamation. Most of these cases follow a messy, public falling-out between Cosgrave and David Kelly and Daire Hickey, other co-founders of Web Summit.

Cosgrave and Web Summit appear to have kicked off this string of legal actions in the fall of 2021 when the company sued Kelly and another former Web Summit business partner, Patrick Murphy, in the United States and Ireland, alleging that the pair secretly established a venture fund using company resources, per The Irish Times and a court document obtained and reviewed by BetaKit.

Lawsuits filed against Cosgrave since then by Kelly and fellow Web Summit co-founder Hickey have made a variety of allegations about Cosgrave’s professional behaviour, including claims of bullying and harassment.

None of these allegations have been independently verified by BetaKit, nor have they been proven in court, as these suits and countersuits appear to remain in the pre-trial stage. BetaKit understands that each party has denied the allegations made by the other. When given the chance by BetaKit to comment on this litigation and respond to these allegations, Cosgrave declined to do so.

However, a Web Summit spokesperson did respond to BetaKit, denying these allegations and stating that all of the claims from Kelly and Hickey are “baseless and without merit.”

Paddy Cosgrave speaking at Web Summit 2022.
Paddy Cosgrave speaking at Web Summit 2022 (Stephen McCarthy/Web Summit via Sportsfile).

Those allegations include ones made in a 2021 legal filing, where Hickey alleged that Cosgrave is “a highly egocentric, manipulative, volatile and vindictive individual” who when questioned about his conduct, “typically reacts with extraordinary vitriol,” according to reports by the Irish Independent. “[Cosgrave] will stop at nothing to exact revenge on those who he believes have been disloyal, or who have slighted him in some real or imagined way,” alleged Hickey.

Per the Irish Independent, Hickey also alleged that Cosgrave hacked the email of a rival tech event, used corporate funds without proper authorization, used company resources to engage in “vendettas” against business and political figures, and made a “very substantial” payment to a female ex-Web Summit employee to settle claims of bullying and harassment. The Web Summit co-founder alleged Cosgrave’s conduct “has been—and continues to be—extremely damaging to the company’s reputation.”

In Cosgrave’s replying affidavit to both Hickey and Kelly, obtained and reviewed by BetaKit, the Web Summit CEO denied Hickey’s allegations and alleged that Hickey had also breached his fiduciary duty to Web Summit, among a variety of other claims.

According to an email statement provided to BetaKit by Web Summit, the allegations by Hickey and Kelly “have been made purely to distract and deflect from the legal case Web Summit first took against David Kelly in Ireland for breach of fiduciary duty.” The spokesperson added: “We look forward to future hearings when matters of fact will be given due consideration.”

With files from Douglas Soltys.

Feature image courtesy Collision via Sportsfile. Photo by Eóin Noonan.

Josh Scott

Josh Scott

Josh Scott is a BetaKit reporter focused on telling in-depth Canadian tech stories and breaking news. His coverage is more complete than his moustache.

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