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Peter Dey is chair of Paradigm Capital and a former chair of the Ontario Securities Commission. David Roland is the CEO of Paradigm Capital. Derek Burney, who consulted on this piece, is former Canadian ambassador to the United States and serves as an adviser to Paradigm Capital.

Canadian equity markets have suffered an extended period of underperformance and a long trend of declining liquidity that have combined to create obstacles to success for domestic companies that best represent what should be our national business goals of innovation, entrepreneurialism and job creation.

Canada needs a healthy community of diverse and growing companies. The Business Development Bank of Canada has identified "high-impact firms" as crucial to competitiveness on the global stage. The key characteristics of these are a high growth profile, a history of job creation and management teams that have a high capacity for risk and a strong desire for achievement. According to BDC, these firms account for a disproportionate share of GDP and employment and epitomize the characteristics needed for success in the global economy.

High-impact firms require an efficient connection to capital to fund growth. Today, however, a wave of consolidation, risk aversion and a "bigger is safer" mentality have contributed to a frigid environment in the Canadian financial ecosystem. High-impact firms now suffer diminished access to lifeblood capital and less access to experienced and objective advice from like-minded advisers.

Independent investment dealers are the logical financial advisory partners to the type of company BDC has identified as crucial to Canadian competitiveness. Independents have thrived through several business cycles by the application of uncomplicated business plans that emphasize long-term relationships, the efficient use of relatively modest-sized balance sheets and a revenue model based on untied fees for specific services. We understand entrepreneurs because we are entrepreneurs.

Much noise has been made about how the current economic and market conditions present stark challenges to our community. This misses the point. The disappearance of many independent investment dealers over the past three years has been a signal that the conduit they represent, one that should link healthy capital flows to the real economy, has been constricted. This constriction hurts high-impact firms and impedes job creation. To focus on the travails of some in this community prompts questions about whether Canadian high-impact firms are being adequately championed in our financial ecosystem.

A contemporary debate arising from market conditions raises another question: Are we experiencing one of the most testing cyclical declines in history, or a secular change in financial markets that portends a permanent change in the way growing companies interact with the capital markets during critical stages of their development? Permanent change would adversely affect the Canadian economy's long-term prospects. It would eliminate a crucial component of a healthy capital markets ecosystem and undercut the opportunity for high-impact firms to continue to grow, to compete effectively on a global scale and to stimulate the Canadian economy.

Like the high-impact firms we partner with, however, we do not believe these challenges are permanent. We are firm in the conviction that Canadians will continue to be very good at starting companies that are innovative, growth-oriented and eager to make a positive domestic and international impact.

Although we do not operate under a coalition or umbrella organization that might help mitigate fierce competitive pressure from the Canadian banking oligopoly, independent investment dealers will continue to be a vibrant part of a healthy Canadian capital-markets ecosystem. Without the balance sheet of a bank and the apparent accompanying opportunity to employ a strategy of tied selling, we will be judged solely on the merits of the services we provide. In the provision of those services, we will continue deploying our own capital, grooming young entrepreneurs to be future partners and pursuing the national ambitions of innovation and growth.

This is not the time to be writing eulogies for Canadian entrepreneurialism. Instead of crying woe, it would be better and smarter to define and seize the significant opportunities for innovation and growth that are being nurtured in Canada.