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There is more free floating capital. There are VCs in the US who are willing to invest in all sorts of things and willing to take chances. There are few VCs or
by omouse 10y ago
There is more free floating capital. There are VCs in the US who are willing to invest in all sorts of things and willing to take chances. There are few VCs or banks in Canada that would take a chance on Facebook, Twitter, SnapChat or Uber. Brain-drain is a problem but the bigger problem is lack of capital.
Also, its in the employers best interest to keep salaries down and convince their employees that living in Canada (Vancouver instead of San Fran) is better (how ever you define better).
Yes, especially true. I've yet to see any Canadians who have actually received a raise in recent years. No one talks about it and no one knows whether their salary will be increased to at least meet inflation. It's a little messed up.
- kpil 10y agoThe free capital is probably a large factor, just as you say because there is a culture of investing in software development. I don't think you see that as much in say Japan or Germany or anywhere in EU. The northern European countries are more geared for industrial conglomerates, as is Japan, and I have no clue what they do in southern Europe, but it's not investing in software development. Other factors in Europe is probably as simple as historically less divergent incomes, less incentives for higher salaries due to higher and more progressive taxes, and a lower demand for really skilled developers due to the industrialist mindset that is hard to shake.
- nasalgoat 10y agoRaising money for an internet startup in Canada is effectively impossible. You might get some minor Series A angel investors (dentists and vets are your best bet), but once you start getting into the Series B rounds where you need real money, you won't find anyone willing to risk it. All they're interested in is gas/oil/mining. Very risk adverse. We've had to resort to roadshows down in California and New York to try and get US capital.
- cylinder 10y agoIt's not about risk aversion. There's just not enough money going around. US is a big country so obviously if 1% of your capital will be allocated to high risk VC it's going to be a much more substantial amount.
- nasalgoat 10y agoWe've had Canadian VCs tell us it was too risky to invest in internet startups. Full stop.
- Eridrus 10y agoThey're not really wrong though. Unless you really know what you're doing you will lose money, as evidenced by the fact that most VCs do in fact lose money and venture as an asset class sucks.
- omouse 10y agoThey aren't wrong but salaries are too low; you can't really bootstrap unless you're doing a side business and then you're effectively working two jobs. There's no YC in Canada or at least it's harder to get some funding.