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Governor General David Johnston talks innovation with Cantech Letter at C2MTL

Governor General David Johnston at the C2MTL Conference
Governor General David Johnston at the C2MTL Conference

David Johnston, Canada’s 28th Governor General, is at the C2MTL Conference in Montreal, along with six winners of the inaugural Governor General’s Innovation Awards, to talk about the importance of innovation for the country’s future.
Though he modestly insists that the addition of an Innovation category to the Governor General’s Awards is not his way of leaving his mark on the office he holds, there can also be no mistake that innovation has become part of Johnston’s DNA.
He was the fifth President of the University of Waterloo from 1999-2010, a decade that coincided with one of the most intense periods of technological activity in Canadian history, in which the University played a central role, being the alma mater of and recruiting pool for the co-founders of Research In Motion, and then BlackBerry, and the overall development of Kitchener-Waterloo as one of the world’s preeminent technology hubs.
In 2011, after his installation as Governor General, the University of Waterloo added Johnston’s name to its Research + Technology Park, situated at the north end of the campus and home to the Accelerator Centre, which Johnston helped celebrate the 10th anniversary of recently.
Today, the Kitchener-Waterloo region is home to more than 1,100 start-ups and businesses, producing goods and services valued at more than $30 billion per year.
Cantech Letter spoke to David Johnston at the C2MTL conference this morning.
You were president of the University of Waterloo for the first decade of the 21st century, which happened to coincide with the rise, fall and aftermath of BlackBerry, and then the subsequent spreading out of ex-BlackBerry talent across the Kitchener-Waterloo ecosystem. The university played a key role in fostering a new ecosystem during that time. Can you give us an impression of how that looked from your perspective?
It’s a remarkable ecosystem, and it’s very collaborative. The image I use to describe it is that of a barn-raising scene, going back to the Mennonite roots, where you see intense collaboration of people with different skills and different talents coming together to raise a neighbour’s barn. That transfers to today, when you see great collaboration. From BlackBerry has come Mike Lazaridis’ Perimeter Institute for Theoretical Physics, the institute for quantum computing. There’s a full ecosystem around that, incorporating theory, experiment and application. My guess is that we’ll see a quantum computer coming out of that, which will permit us to have another run after Moore’s law is extinct, in terms of enhancing the capacity of computers. So it’s an intense, collaborative, and creative network in Waterloo.
The big Canadian technology narrative tends to be the rise of very large companies, like Nortel, like BlackBerry, and then their fall. Is there something about the nature of Canada that prevents us from getting out of that cycle?
BlackBerry, of course, is continuing on in a somewhat different form. That’s the nature of change. As Joseph Schumpeter said, creative destruction, so that one has to be reinventing oneself all the time. Apple, for example, has gone through at least two of those transformations. Microsoft also has. And in this new communication revolution, I think we’ll see many different iterations, and some will thrive for a while and some will perish. But out of the setbacks, of course, comes a new generation of creative people, and that’s what’s happening in Waterloo.

I hope that Canada will be seen in years to come as an innovative nation, a place that welcomes diversity, curiosity, with a very good public education system that develops talent to the full, and that Canadians will see innovation as our answer to the challenges of the future. – Governor General David Johnston

You were just at the 10th anniversary celebration for the Accelerator Centre in Waterloo. Ten years runs back to just before the financial crisis and also before the rise of start-up culture as we now know it. How did that all look, when it began? And how does it look today?
I think it exceeded our best dreams from 10 years ago. Our first concern was that we expected that with a large acreage for an R + T campus at the University of Waterloo, that one of the multinationals would become an anchor tenant, whether that was Microsoft, which employs more Waterloo students than any other university (not every year, but from one year to another), or IBM, who had hired so many of our co-op students, or Hewlett-Packard, or Cisco, which bought a major Waterloo company called ClickStream. But that didn’t happen, so we got humble and went back to our roots. With local taxpayer money, we started the park. The first tenant was the old company Watcom, which was the FORTRAN language, which turned into WATFOR and then WATFIV. They were an influential company. The second was OpenText, which came out the search engine for the Oxford English Dictionary that was developed at Waterloo. The third was the Accelerator Centre. And that’s flourishing now, because of the very tight network of ideas moving back and forth, from the university to the commercial operations and the movement of professors and students back and forth.
It can’t be an accident, then, that the Governor General’s Innovation Award was inaugurated under your watch. You come from a culture already steeped in innovation.
When I was installed in this position five and a half years ago, the title of my installation address was “A Smart and Caring Nation: A Call to Service”. And both adjectives are important, smart and caring. There are three pillars: family and children, learning and innovation, and finally philanthropy and volunteerism. We’ve done a number of things on each of those pillars to try to accentuate them. And under the Innovation head, one of them is the GG Innovation Awards. Why are we doing it? To celebrate innovation, but also to enhance the culture of innovation. Five of the inaugural winners are here today, speaking on a panel about their innovations.
We appear to have a more amenable federal government suddenly when it comes to innovation. The Minister of Economic Development now has the word Innovation tacked on to the end of his title, for example. Is Canada moving away from our history of mining and oil & gas extraction as a symbol of Canada’s past, and more towards a culture of real innovation?
Well, I hope we are. And I hope that Canada will be seen in years to come as an innovative nation, a place that welcomes diversity, curiosity, with a very good public education system that develops talent to the full, and that Canadians will see innovation as our answer to the challenges of the future. Darwin once said, “It’s not the most powerful or the strongest of the species that will survive, but it’s the most resilient.” And I’d love to see Canada as a resilient, innovative nation that welcomes change and uses it to its best advantage, to improve the human condition, both here and abroad.

My guess is that we’ll see a quantum computer coming out of that [ecosystem], which will permit us to have another run after Moore’s law is extinct, in terms of enhancing the capacity of computers. So it’s an intense, collaborative, and creative network in Waterloo.

There’s a lot of talk lately about creating the right conditions for improving the tech ecosystem in Canada. We’re very good at creating a lot of tiny little companies, and then helping them out later if they become huge, but there’s a gap for that middle stage of financing and development, for example. Do you have any specific thoughts about how to improve Canada’s tech ecosystem, from coast to coast?
I would say three things. One is that it shows how this ecosystem is very complex. You need collaborators and participants at different stages of the cycle. At that mezzanine cycle, there is an area where we do need some help. I hope that we’ll see our institutional funds with a greater appetite for that. We’re also seeing, through the Accelerator Centre experience, that it began with angel investors, but we’re seeing more and more venture capital moving in, mainly from the U.S., and increasingly Canadian. But I think that’s part of the maturation process for Canada. We have to realize that we need to be present in all stages of the cycle, and that we can’t rely simply on government to provide that kind of investment.
Right, and in the past five years we’ve seen public pension plans like OMERS Ventures and Investissement Québec, which have provided a way of investing directly in companies that wasn’t there five years ago.
Yes, that’s an interesting development. It was not many years ago that we freed our pension funds in Canada to invest more than 10% outside. Why did we do that? We did that for diversity, to balance our portfolio. As you mentioned, there’s a gap in terms of supply of capital at the mezzanine level. What we know is that the supply is very good. And we’re increasingly becoming better at making the calculation or the analysis of what makes a good investment in that sector and what’s not. So what we need is a social innovation, of more people that have the skill set to be able to evaluate and say, “Okay, it’s a $50 million company. Here’s where another $150 million or $200 million is going to take it.”
You just handed out the inaugural Governor General’s Awards last week. Is this your way of leaving your stamp on the office?
I don’t worry a lot about leaving a stamp. I think it’s important to institutionalize the office and strengthen the office, but not to personalize it. So we’ve seen a number of awards going right back to 1971, when Lord Dufferin created academic medals of distinction. They’re not associated with his name, but they’re there as a Governor General’s Award. I hope the same thing will be true of the Innovation Award. It will be true of the Arctic Prize, that was established about three years ago now, with our office in partnership. I hope that these things will become part of the fabric of Canada, so that we won’t associate them with a person but we’ll associate them with a Canadian characteristic.
But we do now associate Adrienne Clarkson with the Clarkson Cup, for example.
Or the Grey Cup or the Stanley Cup, I suppose that’s true. But ideally you enter into a job where the objective of the exercise is to leave the institution stronger than when you found it, even if you found it already strong. We felt that innovation was an important feature of the country that we wanted to emphasize and celebrate, and above all, to build up the networks that are promoting innovation.

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