Adam Peabody is the director of Planet Hatch, an acceleration centre in Fredericton that helps entrepreneurs and startups grow into well-positioned, internationally competitive companies.
Innovation is important to Atlantic Canada, but learning to sell those innovative products and services is even more critical, now.
The “startup culture,” once perceived as exclusive to the California Bay Area, has most certainly reached our Atlantic Canadian shores. Walk through any local accelerator or university business class and you’ll be met with the same phrases of Millennial and Gen Z entrepreneurs from around the world: “let’s make it go viral,” “we need to iterate,” “it’ll be disruptive,” “time to pivot,” and the dreaded “we’re just focusing on innovation right now.”
This generation of entrepreneurs and the public-at-large are constantly told by politicians, government and “thought leaders” that to compete in business, New Brunswick has to get better at innovation.
It’s the most common of buzzwords and a challenge with seemingly obvious solutions: dump more public money into research, graduate more engineers and computer scientists. Bingo, presto, game-changer for New Brunswick – the Silicon Valley of the East.
Hey, the word can even fit on entrepreneur’s MacBook stickers and over-sized coffee mugs, how innovative is that?
Actually, New Brunswick already does innovation very well. Take Fredericton, for instance. In the two-kilometre radius encompassing Knowledge Park and the downtown core, there are more than 60 research and development organizations and institutions. That’s about one for every 1,000 residents.
The University of New Brunswick alone has had over 90 patents issued since the year 2000 and has managed more than 300 invention disclosures. The New Brunswick Innovation Foundation, which specializes in venture capital and research investments, has funded nearly 500 applied research projects and injected more than $500-million into our economy through direct investments and leveraged funds since 2003.
So, with all of this innovation happening, why aren’t we seeing greater economic results? One word: sales. With all of the emphasis on innovation lately, we’ve forgotten the number one principle of successful businesses: if no one will buy your product, it’s not worth a dime.
I don’t fault new entrepreneurs, though. In New Brunswick, we simply do not emphasize sales as the most critical factor for successful startups, and it shows. New entrepreneurs take the advice they’re given and spend their time and resources focusing (being captivated even) on building their product as opposed to validating whether it’s commercially viable and then doing the hard work of identifying, selling, and closing customers.
The importance of sales is evident to anyone who’s watched an episode of Dragon’s Den or Shark Tank. Even the best pitch with a product that elicits the most enthusiastic response from investors comes crashing down if the entrepreneur hasn’t demonstrated true market demand and sales traction.
But sales alone aren’t enough to jump-start New Brunswick’s economy. In a regional market with less than 2.5 million people, entrepreneurs have to sell their products internationally to really move the needle. And while I’m sure you’ve seen photos of politicians leading trade missions in distant markets, you might be surprised that companies in the startup phase are encouraged to not even think about exporting until they are profitable in our regional market.
No doubt, exporting is complicated, time-consuming and resource-draining work. But it doesn’t make any sense for startups with global potential to limit their growth by kicking the tires in one of the smaller markets of the world. Many promising companies from our region have been out-hustled by competitors because they haven’t thought of selling globally from day one or have simply taken too long to penetrate international markets. Inevitably they are acquired or killed by competitors with larger market shares.
So, what do New Brunswick entrepreneurs need to do? Innovate quickly and then get to selling. Look at customer acquisition in a borderless context. Hire and place as much value on your sales team as you do on your product development team.
Innovation is important. And we have a robust, world-class network of organizations, institutions and academia that support it. But to truly achieve economic prosperity we need to emphasize international sales in our startup culture and support local entrepreneurs in penetrating the global marketplace.
Huddle publishes commentaries from groups and individuals on important business issues facing the Maritimes. These commentaries do not necessarily reflect the opinion of Huddle. To submit a commentary for consideration, contact editor Mark Leger: [email protected]