Startup groups urge Ottawa to extend ElevateIP funding

Multiple Canadian startup support organizations are calling on the federal government to re-up an intellectual property (IP) program that could expire in the spring. 

“IP is so mission-critical. The demand is so high, we could have put double the funding to work.”

Sonya Shorey, Invest Ottawa

The program, ElevateIP, aims to help startups file patents and develop an IP strategy to retain innovations and inventions in Canada. Launched in the 2021 federal budget, ElevateIP is managed by Innovation, Science and Economic Development Canada (ISED), which established a national IP strategy in 2018. ElevateIP was allocated $90 million in 2022, with the funds set to expire in March of 2026. 

Seven organizations across the country that together deliver the program submitted a letter to the federal government asking for another $90 million to fund a “next-generation” ElevateIP program until 2030. These organizations are Invest Ottawa, New Ventures BC, the University of Calgary’s Innovate Calgary, Winnipeg’s North Forge, Kitchener-Waterloo’s Communitech, the Movement to Accelerate Innovation in Québec (MAIN), and Springboard Atlantic. In the Ottawa region and Eastern Ontario, Invest Ottawa also leads delivery alongside Kingston’s Launch Lab and Durham region’s Spark Centre. 

Sonya Shorey, CEO of Invest Ottawa and the lead for the program renewal effort, told BetaKit that demand for the program in her region is “insatiable.” She said the organization had to repurpose some of its marketing and operational dollars for ElevateIP to ensure there was enough grant money for founders. The Alberta edition of the program closed applications in June “due to overwhelming demand.” 

“IP is so mission-critical,” Shorey said. “The demand is so high, we could have put double the funding to work.”

The Logic reported that Elevate IP is among more than a dozen innovation programs introduced under former prime minister Justin Trudeau that will expire this spring. Prime Minister Mark Carney has tasked each federal minister with finding areas to cut from their budgets. The first federal budget under Carney is due in October; consultations ended on Sept. 3.

Shorey says the funding’s allocation near the end of 2022 meant that the program got up and running in 2023. The letter authors claimed that ElevateIP has engaged over 9,000 startups, developed more than 800 IP strategies, and helped startups file more than 1,600 new IP applications. They argue that Canada must continue supporting the program so that it can ensure IP related to quantum, artificial intelligence, and defence technologies remains in the country.

ElevateIP offers three tiers of program support—education, strategy development, and implementation—across which startups can receive a total of up to $100,000 in grants. After a client startup gets an educational primer, typically for free, it can develop an IP strategy with an advisor and service provider, with up to $25,000 in funding. The third tier involves executing on the IP strategy, such as by filing patents or trademarks. 

Filing a Canadian application can cost between $5,000 and $20,000, not including potential advisory or legal fees, according to the MaRS Startup Toolkit. Many startups also want to protect their IP internationally, which adds to the bill. 

Guillaume Lajoie, communications and public affairs manager at MAIN, said that even if a smaller allocation of funding was renewed, it would be a win for the startups they are serving. 

“Thousands of startups are recognizing the importance of IP protection, and cancelling the program now leaves them without support at a pivotal time,” Communitech CEO Sheldon McCormick wrote in an email to BetaKit.

Startups that have used the program include Victoria, BC-based cancer drug testing platform VoxCell BioInnovation and Ottawa-based defence technology startup Tactiql. 

Michael Nelson, CEO and founder of Tactiql, told BetaKit that ElevateIP’s services covered most of the costs for its patent-related legal fees. The company develops software that collects and centralizes data from intelligence, surveillance, and reconnaissance (ISR) sensors during military operations. 

Nelson called the support for IP a “fundamental requirement to be able to compete” with companies from other nations. Last month, Tactiql was selected as one of two Canadian companies for the NATO Defence Innovation Accelerator for the North Atlantic (DIANA). 

Demonstrating an IP strategy is an important part of applying to programs like DIANA, as well as grants and agreements with the Canadian government, Nelson added.

Similar programs exist across Canada, including the National Research Council of Canada’s IP Assist and the provincial program Intellectual Property Ontario. However, the letter writers argued that these supports are “fragmented,” where ElevateIP fills in “critical gaps.” 

Beyond accelerators, “Investors increasingly require IP as part of their due diligence,” Shorey said. Research from Taorui Guan, an assistant professor in law at the University of Hong Kong, found that IP protections can reduce investors’ loss risk and establish clearer ownership rights if the startup fails. 

Productivity potential 

Prominent business leaders and organizations have lauded IP protection as key to improving Canada’s economic productivity. 

IP protection rates, measured by the number of patents filed, have been roughly flat over the past 10 years in Canada, according to the most recent report from the Canadian Intellectual Property Office. Patent and trademark applications respectively decreased by six percent and three percent in 2023. 

Ex-BlackBerry co-CEO Jim Balsillie has repeatedly argued that encouraging sovereign IP retention is part of the solution to Canada’s productivity woes. One study from Boston University found that the Canadian “patent paradox,” where productivity hasn’t matched patent growth, could be due to foreign ownership of patents.

Economist Robert D. Atkinson, president of the Canadian Centre for Innovation and Competitiveness, has noted that Canada runs a trade deficit on IP (paying more for foreign licenses, like software, than it receives for its own IP). However, he believes that  a US-style surplus would only amount to three percent of Canadian GDP, or “hardly enough to move the needle on productivity.”

Aside from this, the ElevateIP campaigners argue that IP is now central to Canadian sovereignty, as the country seeks to become less dependent on the US following a trade war and annexation threats. According to McCormick, this is especially critical when it comes to developing AI, quantum, and dual-use technologies. 

“Canada has a habit of letting its best ideas leave the country, and we can’t afford to let that continue,” McCormick said. 

Feature image courtesy Benoi Debaix.