After years of low interest rates, low inflation, and strong growth of tech around the world, global market conditions have changed. What does it mean for BC’s tech sector?
This is the question addressed in the latest State of BC Tech Nation. BC Tech’s Fall 2022 report looks at how companies are responding to the downturn.
Here are four quick facts on the state of BC tech according to the report.
Local Talent Still the Big Crunch
Resoundingly, companies shared that talent is their primary challenge, noting some recent relief though with layoffs in the market loosening up some local talent. One founder described layoffs as “natural market forces.”
Tech talent is still in the driver’s seat, however, with three-quarters of BC companies wishing they had easier access to quality local talent. Just 27% of companies cited non-talent concerns as primary over the past three years.
Hiring, Scaling Elsewhere?
The demand for tech talent in BC outstrips the supply. As a result, companies face pressure to hire outside of BC—and 78% do. Less than a quarter of companies are willing to scale more slowly in order to retain a localized team.
Despite firms hiring outside BC to grow, overall the province struggles to support startups scaling beyond a certain stage. Or is it a local founder mindset issue?
“I’ve always wanted to see more of our local entrepreneurs and tech businesses focused on long term,” one BC entrepreneur suggested. “There is a huge mindset locally of building a business to a certain scale, and then the goal is to sell.”
Finding Customers Anywhere
Where talent is in short supply, so may be customers. As a market, the US is simply bigger and faster.
On the customers’ side, companies in the report noted that selling to Canadian customers is slow and frustrating. Companies are primarily selling outside of Canada—with some having no domestic customers.
“Selling in our own backyard has always been a challenge,” one company said. “Canadians are not very good at buying from other Canadians.”
Pressure Makes Diamonds
BC companies are optimistic that the current market challenges will also create opportunities for technology adoption.
Problems, after all, require solutions.
“Recessionary times are tough markets, but you get all this new creativity, innovation comes out and all these new startups will emerge,” the report quotes a company as saying. “Companies have to optimize their workflow and grow across every industry [which] will drive innovation.”