Toronto’s innovation economy is booming. Last year, at the height of the pandemic, the VCs invested $ 1.2 billion in Toronto businesses, including high-profile increases from Wealthsimple and Maple. Until two or three years ago, tours by the tens of millions were major news. Today they are almost routine. The successful US $ 83.5 million hike for start-up Waabi Innovation is just the most recent example of the city’s upward trajectory.
To gain a more detailed look at the maturing of the startup scene, the Innovation Economy Council has partnered with the City of Toronto to study the support network that helps cultivate these startups and creatives. The recently published report, A city of entrepreneurs: building a city of innovation, a first of its kind, reveals a thriving community of organizations that teach and encourage entrepreneurship.
Startups supported by Toronto hubs
all sectors: 2 222 entrepreneurs
The numbers are impressive. Collectively, the 36 hubs surveyed support more than 5,000 companies in the software and creative industries as well as in growing areas such as clean technology, green construction and advanced manufacturing. In the last decade alone, the number of accelerators and incubators has exploded, with 17 arriving since 2015 alone.
Essentially, these hubs take the raw materials of an entrepreneur’s ideas and ambition and turn them into viable businesses. These accelerators and incubators exist in various categories. They are both found in university and non-university settings, can be funded in part by public or entirely private funds.
Perhaps the clearest division is those that aim to foster entrepreneurship and startups, and those that focus on creative pursuits. These include places like the Center for Emerging Artists and Designers at OCAD U and Artscape Daniels Launchpad, which help artists develop creatively, but also bring their work to market. Meanwhile, accelerators for startups such as Ryerson’s DMZ and the University of Toronto’s Creative Destruction Lab offer a wide variety of programs to teach entrepreneurship, the basics of starting or building a business. , marketing and details of finance and capital raising.
Some areas stand out. Toronto’s strength in medical research has translated into a significant number of health and biotechnology start-ups. Meanwhile, digital media, which includes enterprise software, fintech, AI, and machine learning, is still the most dominant field in terms of numbers. However, other areas like social innovation, retail, and the food and beverage industries are also making inroads.
The mix of type and sector in the city has ripple effects. The more diverse and vibrant Toronto’s innovation economy, the more likely it is to build successful relationships – whether a food startup can combine strengths with a fintech company, or tech startups clean and AI can work together in unexpected ways. The diversity of the hubs themselves is also helpful: Companies that start with one or two employees in a small college incubator may find themselves growing with the help of one of the larger accelerators a few years later.
However, there is still work to be done to ensure that the full benefits of Toronto’s booming economy are realized.
For the moment, the activity of accelerators and incubators is mainly concentrated in the city center of the city, and fewer entrepreneurs are served in the inner suburbs. And while the city has made encouraging progress in terms of the number of female founders, Indigenous entrepreneurs still lag far behind the general population.
Toronto’s innovation economy will be shaped for years by the trajectory of its recovery from COVID. Fast-moving startups are ready to lead the city’s rebound; the challenge will be to ensure that the rising economic tide lifts all boats. By closing the gaps in its innovation ecosystem now, Toronto can rebuild better and emerge even stronger than before.
The full report is available here.