Interview: Charles Plant, Advisor, Market Readiness Programs, MaRS

April 7th, 2008 | Posted in by

Read a Red Canary article Plant wrote in 2006 while Managing Director at Q1 Capital Partners.

Charles Plant is Advisor, Market Readiness Programs at MaRS Discovery District in Toronto.

A seasoned executive with a Chartered Accountant’s designation, an undergraduate degree from U of T and an MBA in marketing from McMaster University, Plant has enjoyed spells as a CEO, CFO, investment banker, management consultant and auditor. He estimates that he has worked with (and for) over 100 companies in his 28 year career.

In addition to his role at MaRS, he is a faculty member with York University’s Schulich School of Business.

You got into the tech world when the idea of a commercial Internet was little more than fancy. What was it like being an entrepreneur in Canada then?

Charles Plant: In 1987, I founded a company called Synamics, an early player in the voice response space. Before the Internet that’s what everybody was into and we had a new competitor every week. That morphed into us developing mass calling platforms. Nobody knew what they wanted or how they wanted to do it…the projects were disastrous.

We eventually decided to productize but even that was tough. At the time if you wanted to sell to B.C., you had to deal with the time zone issue. In Quebec, it was the language issue. In the U.S. it was ‘Why aren’t you American?’ It was actually easier for us to sell to the U.K. than any of those places.

VC was just getting big and I wondered, what can we get? We prepped some stuff and ended up getting a term sheet from someone we’d never even met before; those were crazy times. We raised 12 million but had morphed ourselves into an area that I didn’t understand, so I hired a management team out of Boston to run the thing. The company survived the telco meltdown of dot-com but nobody got any money out. It was totally Canadian.

Talk about MaRs and what you’re trying to make happen there.

Charles: MaRS is a convergence centre. Our raison d’etre is to bring to together technology, capital and business. In the 10-block area surrounding MaRS, there’s a billion dollars of research done every year . . . it’s not commercialized in the most effective manner.

The Market Readiness Program does five things. First, there’s all sorts of organizations that can help you commercialize. We provide those organizations with more resources, like putting in Entrepreneurs in Residence. They’re all people who have been successful and maybe failed too, hopefully both.

Secondly, we supply a lot of market research, which can be a big hit as a start up. Thirdly, we supply a number of how to’s, to answer questions like, “How do I put together a pitch deck?” or “How do I write an employee offer letter?”

We also provide connections. You need a wireless apps company in Detroit? Well help you find one. And money of course. We offer up to $10,000 for project funding, and as much as $500,000 for a dozen young companies per year. People think MaRS is [purely] UofT, but we’re in the business of commercializing anybody.

One of the common challenges noted by innovators engaging in the commercialization process is that there’s no federal standard for how IP is identified and assigned. And, until there is, Canada’s knowledge economy will run a distant second to our southern counterparts. Your thoughts?

Charles: I know that some of the universities are struggling with that . . . I think that’s a lot of whining. The universities do help out in the commercialization process. Maybe it’s complex – the University of Waterloo certainly has a different approach from the UofT – but if there’s a good tech, it’ll still find a way out to the market.

What’s more of a problem is an antipathy towards the process of commercialization. I think the Canadian head space is that commercialization is viewed as a dirty thing whereas pure research is clean. Canada spends billions on research but very little on commercialization and as a result there’s a lack of a market link from research outwards.

So what needs to happen to bridge that gap? Is it about bringing back something like the Labour Sponsored Investment Fund to stimulate capital markets, or is there something else that can stop the hemorrhaging of ideas and people to other markets?

Charles: Canada has a systemic problem that relates to the degree of competitiveness of the Canadian industry. We have a population of 33 million people here but not really. What we really have are three catchment areas, which I define as an area with the same political and linguistic characteristics within an hour’s plane ride. In Ontario, there’s an area of eight to nine million. In Quebec, five to six million, and there’s a smaller area in B.C around Vancouver.

In the U.S. there are seven catchment areas with more than 30 million people. There is a much greater degree of competition with 30 million, so you have to perform better. That leads to requirements to solve competitive problems, which leads to R&D that’s pulled-out by someone trying to solve a business problem.

It’s just not the same here. So, we’re not required to be as innovative, there’s not as much R&D, and not as many companies competing. That’s a systemic problem that isn’t going to go away. The Canadian model of feeding research and pushing it out without proper commercialization just doesn’t work.

Is the answer a highly regionalized model like Waterloo where you have the Accelerator Centre, the university, Communitech, RIM and such all on-the-same-page? Or is that an insular way of doing things that ultimately keeps those key catchment areas compact?

Charles: Waterloo is a tremendous success story and it’s certainly a tight community. I think that’s a great thing but I’m not sure that it’s a model that works at getting companies out.

In Canada, you need to start out globally and we don’t spend enough on marketing to do that here. That’s partially an outcome of the fact that the SR&D program pays for R&D, but R&D only. If a reasonable portion of the SR&D credit could be contributed to the marketing of what’s being developed, you’d have better results on commercialization.

As to the LSIF, the only people who made any money on those were the people managing the funds. The better thing to do would be to create a matching program for individual and institutional investment (to drive a spirit of partnership).

Where are MaRS, the province, and Canada’s knowledge economy going in ’08?

Charles: MaRS Innovation is the creation of a tech transfer office on steroids. There’s 12 or 16 research institutions in the GTA that have come together to invest and create and an outward-looking avenue for commercializing university research. This will create probably the largest collection of IP in the world. In 12 months, it’ll be up and running and good research identified. It’s a five year plan.

On the public side, I think we’re going to bumble along for a while and eventually we’ll see programs like the MaRS Market Readiness Program out and accepted in the community. We can improve the stock of entrepreneurs in this country. Over time, we’ll end up with a better crop of entrepreneurs and create an ecosystem that spawns more innovation — but it will take longer than people think. And please keep in mind that this opinion is worth exactly what you paid for it.