The EY G20 Entrepreneurship Barometer 2013: Canada
Canada’s ecosystem is strong, but funding options could be improved.
Canada’s strong economic performance relative to many of its mature G20 peers has benefited its entrepreneurs, and the Government has sought to offer additional help through a raft of policy initiatives and business-friendly tax and regulatory systems. Still, entrepreneurs complain that the support does not always get through and access to funding remains a potential barrier to growth. The country remains a world class entrepreneurial environment, but stronger mentoring and increased efforts to bolster research and development (R&D) activity would help.
- The Government has been highly supportive of entrepreneurs, providing regulatory and tax regimes that have enabled start-ups and growing companies to flourish.
- The Canadian education system benefits from higher levels of public spending and includes programs designed to encourage entrepreneurship, including an emphasis on vocational education.
- The entrepreneurial culture in Canada is strong. Entrepreneurs report relatively less fear of failure, and a very high level of scientific and technical journal articles emphasizes their focus on innovation and research.
- Canada scores poorly on the coordinated support it offers to its entrepreneurs. In particular, entrepreneurs are critical of the country’s incubators, whether public- or private-sector led, and the lack of availability of mentors.
- Access to funding in Canada is strong relative to much of the G20, but the picture is still very mixed. Venture capital and private equity is improving, but bank finance remains weak.
- Canada’s relatively low levels of self-employment suggest there is scope for larger numbers of people to be encouraged to capitalize on the country’s supportive environment for entrepreneurship.
- Canada’s fiscal policy is less constricted than many of its G20 rivals’ and its economy continues to outperform, giving the Government greater freedom to invest.1
- While the infrastructure in Canada is supportive of entrepreneurs, there is clear demand for a more direct line of communication between the entrepreneurial community and Government.
- Business R&D spending has been slowing since 2006.
- Despite a raft of Government initiatives aimed at improving the coordinated support available to entrepreneurs, that assistance does not appear to be having sufficient impact yet.
1. “Canada Dollar Rises as Sales Data Signal Faster Economic Growth,” Bloomberg website, bloomberg.com, accessed 18 July 2013.