Marshall Ring likes to think of the Manitoba Technology Accelerator as sort of like the reality TV show Dragons’ Den, where entrepreneurs pitch their business ideas to a panel of venture capitalists in the hope of securing investment finance.
“Sometimes when I describe what MTA is, I go, ‘I’m going to use a horrible example to simplify it but think of Dragon’s Den,’ ” said Ring, the MTA CEO. “We have to be enthused by the idea and we have our criteria. But we also join the management team of the company so it’s not just putting money in. We put people in as well.
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“And that’s a really big distinction.”
With the goal of making Winnipeg the start-up capital of Western Canada and to build more $100 million Manitoba-based companies, MTA is a private-sector, not-for-profit business incubator that works to grow technology businesses, said Ring.
“Access to capital for ‘good idea’ companies hasn’t always been one of Winnipeg’s strengths when it comes to our business climate,” he said. “So MTA has built a joint investment group and we have never had a deal go under-subscribed. But in the broader community, access to capital is one of the barriers to growth for us and that’s why we’re building MTA InvestCo to make early-stage capital more available for more companies.”
Chaired by Bell MTS and Western Canada Vice Chair Ryan Klassen, MTA InvestCo has already made a handful of investments into MTA client companies ranging in size from $10,000 to $400,000. MTA InvestCo hopes to lead $2 million to $4 million per year of direct investments into Manitoba’s most exciting start-ups and scale-ups.
“Early-stage technology commercialization does have a fairly high failure rate so it is really hard to take a good idea and move it into a functioning business,” said Ring. “But when it can be done successfully, the businesses do have great opportunities to scale and have a profound impact on our economy.”
Providing capital is only part of what MTA does.
“What MTA will do is provide advice, infrastructure and capital,” he said. “If you want to bake a cake, you need flour, eggs and milk. But if you just put the flour in, you’re not going to get too far with the cake. Often times, we deal with founders and entrepreneurs who need help developing and navigating the commercialization process so the application of our management skills helps the companies be more successful and the availability of capital also helps them execute on what they need to.”
What they do is more along the line of angel investors than venture capitalists, Ring said. Angel investors tend to come in earlier when a company is riskier, perhaps doesn’t have a full management team or even customers but has a good idea. They help companies get off the ground while venture capital is the next stage in the process where a company needs funding to expand and grow their business.
“Our goal by putting angel capital in is really to make sure the company builds roots here in the province and they stay here,” said Ring. “So it’s the exact opposite of trying to take over the company. It’s trying to build relationships here in Manitoba. Get the company to have 12 or 15 employees so it’s really hard for that company to move to different markets as they grow.”
With roots dating back to 2004, they started doing business as MTA in 2012. Their most notable and famous success story was SkipTheDishes, the online food delivery service.
“They came to us with two employees and we were with them through that high-growth phase,” said Ring.
Over the last five years, companies supported by MTA have generated over $800 million in business, employing 2,000 employees.
One of the companies that MTA has helped is Triple 3 Biotech – which manufactures high-quality type II collagen used to reduce joint pain associated with osteoarthritis which has been working to break into the Chinese market – whose CEO Ab Freig has no doubts where they would be without MTA.
“MTA helped us throughout the process, helped us with commercialization of our collagen, helped us with providing something as small of (office) space, (as well as) guidance and support and advisory services,” said Freig.
“We would not be where we are without the assistance of MTA.”
In addition to offices on Market Avenue in Winnipeg’s Exchange District, MTA is working to transform 50 Provencher, one of Winnipeg’s most iconic buildings, into a technology and digitally rich world class networking and event centre that can be a vibrant hub to their downtown success. As part of the revitalization process and recognizing the important link the bridge provides between St. Boniface and downtown, MTA is branding the building the International Centre for Innovation (ICI), a play on the French word for “here” and intended to honour the intention of the bridge which was to build collaborations and foster a welcoming destination moving forward.
A grand opening of the building is planned for later this year.