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BlackBerry’s casualties find hope in a healthy tech sector

Mike McDerment, co-founder and CEO of FreshBooks, has already found spots for BlackBerry alumni on the accounting startup’s staff.

Rosa Park/The Globe and Mail

After BlackBerry Ltd. broke the news of its latest wave of job cuts last month, FreshBooks CEO Mike McDerment dispatched some representatives to a Waterloo pub known to be frequented by BlackBerry workers.

His message for the soon-to-be disenfranchised: "Head our way."

The Toronto-based accounting startup has already found spots for BlackBerry alumni on its technical staff and in marketing. Now FreshBooks plans to increase its headcount by 30 per cent over the next four months.

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For the thousands of workers losing their jobs at the beleaguered smartphone maker, there is life after BlackBerry. The company's severe downsizing is welcome news for a host of tech startups and other companies in need of talent to sustain growth. As Mr. McDerment noted, "there are many more companies out there and they're doing well."

Good candidates for promising startups can be scarce in Canada. More than 300,000 Canadians have been lured by jobs in Silicon Valley over the years. Of the tech workers that have chosen to remain, BlackBerry has been an obvious destination, offering high salaries, full benefits and until recently, stable employment.

But as the tech giant has withered, rounds of layoffs have spawned an improvised recruitment service trading in BlackBerry casualties. Communitech, the regional development agency that helped run the program, initially had a much smaller scale in mind in trying to redeploy unemployed tech workers. "It's usually a startup and they have 12 people and they don't make it to the next round," said Iain Klugman, the agency's CEO. But over the past year or so, Communitech has managed to direct about 700 former BlackBerry workers into new opportunities, either starting their own companies or signing on with other tech outfits.

BlackBerry last month announced plans to cut some 4,500 jobs, reducing its staff to about 7,000, and the company desperately attempts to keep costs down as sales sink.

It's a sharp contrast from the 2000s, when the company (called Research In Motion at the time) was synonymous with Canadian tech itself and its employee ranks swelled to 20,000, about half of them in Waterloo. This was the place to be for the Canadian tech sector's best and brightest.

"RIM sucked up all that talent," said Adam Belsher, CEO of Waterloo-based Magnet Forensics. "It was the centre of the universe."

Mr. Belsher was employee number 275 at RIM. In 1998, soon after finishing university, he joined the little-known Waterloo, Ont., company trying to convince the world that wireless e-mail was the way of the future.

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He started to consider life beyond Blackberry in 2011, when, having risen to lead the company's $2-billion Verizon business unit, he had to lay off several of his staff. And he missed the days when BlackBerry was at the vanguard of innovation. "You were basically an evangelist for this disruptive technology. It was really revolutionary," he said. He wanted to build something again. "When I left, my eyes opened up." He discovered a thriving tech sector had propagated in BlackBerry's shadow, with 1,000 companies employing 30,000 people.

Magnet Forensics specializes in data recovery software. The company has grown tenfold in the last two years. Mr. Belsher has already reached out to former BlackBerry colleagues.

But it's not just developers that tech outfits are searching for. "Middle management is such a big part of growing. You get a lot of young people running around, but they might not be managed well," Mr. Belsher said.

Mr. McDerment is also interested in potential candidates among BlackBerry's senior ranks, those seasoned employees with first-hand experience in building a tech champion. "It's never easy to hire great senior talent," he said. "And there's probably less higher-end talent in Canada because there have been fewer big technology businesses built here."

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