CALGARY DREAMIN'

Why Calgary is an entrepreneur’s dream
By: Jameson Berkow
Financial Post Oct 14, 2012

CALGARY — Naheed Nenshi, the mayor of Calgary, thinks he knows why his city’s entrepreneurial culture is becoming so robust, despite the cold winters Calgarians endure.

“The line I usually use when people ask me why Calgary has fostered such an entrepreneurial culture is this is a place where nobody cares who your daddy is or where you went to school. I say it so often that it sounds a bit trite, but I don’t think it is true everywhere,” he said, gazing briefly at the September sunshine bathing his private city hall veranda to reflect on his answer before continuing.

“It is also a very interesting and weird unintended consequence of the way our downtown has been built,” he adds, referring to Calgary’s Plus-15 network of elevated walkways connecting the city’s skyscrapers.

The walkways allow office dwellers to attend meetings in other buildings without having to brave the city’s bitter prairie winters. “Our built environment has actually in some ways molded our business culture,” Mr. Nenshi said.

Calgary’s entrepreneurial culture is even easier to spot than the hundreds of steel and glass connections crisscrossing the city’s core. It hits new Calgarians like myself almost instantly; that infectious feeling of limitless raw potential, of broken barriers to success and endless possibilities.

This is a city of risk takers, of dreamers and of visionary builders. All of these enviable traits have, however, been relatively unknown in the rest of Canada, until now.

In a survey by Canadian Federation of Independent Businesses for the Financial Post, Calgary ranked as the 13th most entrepreneurial city in Canada this year. Not exactly a statistic to brag about, although it is a dramatic jump from No. 35 last year.

“The story on Calgary is getting out,” said Mike Fotheringham, research manager at Calgary Economic Development. “People across the country are starting to understand what is going on in this city.”

Bankruptcy rates here are among the lowest in the country at just 1%, and have fallen every year since 2002. Retail sales growth also tends to be more than double the national average of 3%, reflecting Calgary’s growing affluence.

“There is a sense that if you’ve got an idea, this is the place to make it happen and I think the stats reveal exactly that,” Mr. Fotheringham said.

What the statistics do not reveal is another sense, of the opportunities here being as rich and thick as the bitumen that powers Calgary’s massive oil towers. The sense is not only that such opportunities exist, but that achieving even the loftiest of them can be done without the vast support networks required elsewhere.

One of the largest buyout deals in Canadian corporate history — the $19-billion Suncor Energy Inc. takeover of Petro-Canada — was struck by four men sitting in a small conference room in a posh downtown hotel.

“Other steps in the acquisition had to be taken, but things were essentially wrapped up in that meeting in the Palliser, working out the details with no lawyers, accountants, advisors or second guessers anywhere in sight,” Rick George, longtime Suncor chief executive, wrote in his newly released memoir Sun Rise. “I honestly don’t believe an agreement of this magnitude could have proceeded as it did … in any other city. The city of Calgary has a tradition of openness and trust, placing as much value on a handshake as on any multi-page contract.”

That tradition extends well beyond the gargantuan oil and gas players. When Victoria MacLean co-founded Startup Calgary a little more than two years ago, she counted 45 small technology-focused companies in the city. Her latest count totaled 162.

“The people here get great exposure to big data, to enterprise-level data, so they can really start to see and identify solutions for big problems here,” said the outgoing president of Startup Calgary.

Ms. MacLean is leaving to focus full time on BeauCoo, her latest startup which seeks to build a social network for women of similar body types to share style and shopping information. The company raised a $1.1-million seed funding round from Calgary-based Zinc Ventures last month and plans to launch its mobile app in a few days.

Ms. MacLean considers herself lucky, because early-stage funding is still an issue for Calgary startups with most of North America still standing between them and Toronto, where most of the country’s sources of venture capital and angel investors remain.

“Entrepreneurs will always complain about a lack of angel investors because that is just a translation of ‘nobody likes my idea,’ ” said Mayor Nenshi, who was a business professor at Mount Royal University before entering politics. “The real issue is the second and third rounds of financing.”

That has long been the issue for startups nationwide and remains one of the primary reasons why many Canadian small businesses end up being acquired by larger foreign entities before they reach their full potential. Yet it is precisely that constant struggle for recognition — and the cash that comes with it — that helps Calgary entrepreneurs to stand out and pushes them to achieve.

“There is something of an insecurity complex that runs through the city,” said Alex Middleton, chair of TEDxYYC, the local chapter of a global organization famous for hosting world-class discussions in world-class cities. “That allows you to have more of a clean slate here than in other cities. You really can come to Calgary and reinvent yourself in that ‘maverick’ sense.”

Despite its growing stature, Calgary is still not Alberta’s most entrepreneurial major city. Edmonton scored 8th in CFIB’s 2012 rankings of Canada’s most entrepreneurial cities and even in 2011 it was 11, still two spots higher than its southern neighbour’s most recent title.

“Calgary culture-wise is moving towards a big city mentality, whereas in Edmonton you have more of an independent vibe,” said Ken Bautista, co-founder and chief executive of Startup Edmonton. “It isn’t about being a big city though, it is about being a great one.”

Photo By: Portraitsteve