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Crowdfunding Social Change – Bootstrapping Canada’s Startup Economy

Canada’s goals for an innovation system face the same challenges as their counterparts in all other areas of government who are facing a rapidly changing world that is becoming increasingly techno-centric at a rate of accelerating change.

Policies and programs that were conceived in the 70′s and 80′s during the hey day of the Baby Boomers, are more or less due for the same retirement that this demographic is now shifting into, and with this transfer happening in my humble opinion it presents one of the greatest challenge the nation has faced.

In short if Canada faced a reality with no oil sands where would it stand, how effectively would the policies and programs work at delivering sustained economic growth in the modern Knowledge Economy? If the “easy money” of the oil sands is covering up systemic weaknesses then these weaknesses will still be present and manifest in key issue areas like low adoption of e-Health systems for example, meaning poorer quality healthcare, and is a symptom that will magnify greatly as the % of old people balloons.

So it’s imperative Canada ‘makes hay while the sun shines’, using oil sands revenues to build a future-looking innovation system, one that very proactively links these cash flows to modernization in these key areas, and IT industries like Cloud Computing represent this future.

I set up the Canada Cloud Network initiative towards this end, as I believe the industry offers a foundation to underpin the required next generation innovation ecosystem, which can be explained through highlighting a few of the different levels of benefit it offers:  

  1. Canadian Cloud Ventures – The changing laws for entrepreneurism
  2. Crowdfunding Apps – Using Cloud apps for the processes of innovation
  3. Next Generation Cluster – The broader ecosystem these apps can feed 

Canadian Cloud Ventures – Look Ma, No IT Department

Before we step into considering the broader ecosystem of startup innovation, one of the first and most brutally simple ways to convey the value of Cloud Computing is the relationship to entrepreneurism.

In short, it makes sophisticated technology more widely available to more people. What would have cost you $100,000 just five or ten years ago is now available via a swipe of your credit card, and can power all kinds of new innovative business models. Ie. It’s making tech entrepreneurism much cheaper, and therefore more accessible to more new entrepreneurs.

Canadian firms like Hootsuite, Futurestate IT and ACIS are all leveraging this utility to launch new businesses, a trend nicely captured in this recent article from the Globe and Mail.

Crowdfunding apps – Innovation building blocks

A simple example of the ‘Power of Cloud’, as it can be applied to help improve the process of innovation itself, is the ‘Starbucks ideas app’ from Salesforce.com.

This uses the community effects of social media to encourage the submission and development of New Ideas, providing a catalyst for an effect known as ‘Crowdsourcing’.

In this white paper Phil Wainright, a Cloud Computing guru, explains how Salesforce.com can be used for these Innovation Management best practices. As a modular ‘PaaS’ – Platform as a Service, Salesforce.com offers a modular approach where these web tools can be coupled together like building blocks to suit any organization.  

Applying this to the process of venture startup investment is known as ‘Crowdfunding‘, and has recently become a hot topic as the USA passed a bill to enable more of this.

Pioneers in Canada have started asking the questions about why Canada isn’t doing the same, and by starting to use these types of Innovation Management apps then it could be brought to life.

Canada Cloud Network : The world’s first Next Generation Cluster

Use of these new social media technologies to improve the innovation process is the central thesis for a white paper from tech giant Cisco, called ’Next Generation Clusters‘.

If Crowdfunding can accelerate more innovation at the individual project level, then NGCs can scale this effect across a nation-wide scope.

Michael Porter conceived the original cluster model and it has become universally accepted as the key model for economic development by Governments, used to grow industries from technology through aircraft.

In essence NGCs update the model to reflect the new era of Web 2.0 global collaboration, the key points are that the cluster model is implemented via technologies like social media, video conferencing and Cloud Computing, and by using collective intelligence models aka “crowdsourcing” to provide a framework that enables more entrepreneurs to start more businesses.

By using these new technologies to enhance the innovation process itself as well as developing an ICT industry, a Next Generation Cluster strategy offers a powerful formula to maximize a compounding effect known as ”Multi-Factor Productivity’ (MFP)’.

Conclusion – Utilizing Open Innovation for Social Change

As per the title of this article the scope isn’t limited just to the capitalist aspects of entrepreneurism.

Crowdfunding is a technique based on using the Open Innovation best practices conceived by Henry Chesbrough, and as the name suggests it has broader social benefit as well as improved innovation process.

The real opportunity for Canada, for any nation, that these new technologies and business models offer is the ability to broaden access to entrepreneurism to any one at any level of society, and to use this principle as the fundamental means of for addressing more intrinsic social issues, such as child and family poverty.

In Canada one in ten still lives at this third world societal level, and its transformation of these statistics that is the real exciting potential for a new innovation ecosystem. Innovation can be used to change anything.


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