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Girl with map of the world (Mykola Velychko/Getty Images/iStockphoto)
Girl with map of the world (Mykola Velychko/Getty Images/iStockphoto)

Guest column

Why Canada needs to grow more 'born globals' Add to ...

In 2002, five aspiring entrepreneurs emerged from the hallways of the University of Waterloo with a vision. Their goal: to ease the pain of supply chain management for retailers that distribute products we use every day. With an easy-to-use logistics software solution emerging from the lab, these ambitious graduates eyed a lucrative market. This commercial opportunity wasn’t bound by regional or domestic borders. This global industry is valued in the hundreds of billions of dollars.

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And it is an industry that is consistently seeking to achieve greater productivity and profitability. Enter Nulogy – a University of Waterloo spinoff that targeted customers in the United States, Europe and Asia right from the start. It is a strategy that is paying significant dividends. Boasting revenue growth of 100 per cent year over year for the last three years, Nulogy has landed multiple multinationals in confectionary, cosmetics, food and pharmaceuticals. In fact, for some household items, they help manage the supply chain for 70 per cent of the products sold in North America. This Canadian company is making international sales, increasing technology exports and creating new jobs. Nulogy is a ‘born global’ firm – and we need to grow more of them in Canada.

So, what exactly is a born global company? These firms are international ‘by design’ and pursue global markets from their inception. They abandon long-standing assumptions that a stable domestic market position is required to pursue worldwide commercial opportunity. They adopt an aggressive global strategy right out of the starting blocks. They commercialize technology with international partners and investors; generate global revenues and bring them home. And in the wake of a fragile global economic recovery, new approaches that inject more global dollars into our economy are long overdue.

It is easy to spot a born global company. International orientation is part of their DNA. It is deeply embedded in the core values and culture of the firm. Every employee from the CEO down is committed to building a global business. Like every start-up, these firms struggle with access to financing, talent and other resources. But the born global takes a different approach. With a high tolerance for risk (and a laser sharp focus on reward), they target very niche market opportunities that others overlook. They aim to gain first mover advantage – before the competition is even aware of the opportunity. They are relentless in their quest to achieve superior product quality. And perhaps most importantly, they quickly establish partners who distribute their product in the local economy. This accelerates commercialization, market penetration and sales. Isn’t this at the heart of business?

Born global companies play a pivotal role in all economies – however in Canada, the importance of these firms is even more pronounced. Largely comprised of small firms, our nation represents three per cent of the total world market. To build our domestic economy, Canadian companies must focus on the 97 per cent beyond our borders. As the world struggles to recover from the economic downturn, there is increasing reliance on the international contributions of these companies. The question: how do we grow more born globals in Canada to stimulate greater global commerce, capture more international revenues – and accelerate the growth of our domestic economy?

There are several ways we can propel the development of these high-growth, globally oriented firms. This includes:

  • Educating new entrepreneurs on how to establish and operate an international business accounting for the diverse corporate, cultural, social and political conditions
  • Fostering and promoting knowledge of global markets, sectors or niches where Canadian companies could gain competitive advantage – and helping them to seize these opportunities
  • Creating and facilitating access to global networks of customers, investors and partners, and brokering cross-border linkages
  • Advocating for trade and export policy that supports the internationalization of firms

Imagine what Canada could achieve with more globally-oriented start-ups like Nulogy. The time is now. By helping our entrepreneurs break new global ground, we can break open new markets and help grow more robust global competitors. It is an approach that will certainly build a better bottom line for Canadian companies and our economy.

Dr. Mario Thomas is the managing director of the federally-funded Centre for Commercialization of Research (CCR) which accelerates the commercialization of publically funded research andbuilds more robust, globally competitive Canadian entrepreneurs and firmsacross Canada. He also serves as senior vice president of the Ontario Centres of Excellence (OCE) and founding chairman of the International Commercialization Alliance (ICA).

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