Vancouver’s AI ecosystem “exploding” — helping keep Canadians at home

Peter McLachlan says he’s always excited when there’s a new wave to catch on the tech front.
“We saw the mobile wave coming a decade ago. When the storm hit around 2009 with the iPhone 3G announcement, we were already there with a product ready to go,” says the chief product officer for Mobify, a mobile customer engagement solution provider in Vancouver.

Fast forward a few years and Mobify is riding the AI wave. “AI is a really interesting wave,” he says. “It’s not like they haven’t been working on AI and machine learning for 40 years. But it has always been this dream that didn’t materialize. People often talked about the AI winter. Now it’s starting to thaw. The tools are finally making their way out of labs for general use.”

AI will help in Mobify’s ability to monitor customer behaviour patterns and use predictive analytics to build their customers’ marketing strategies. “The reality is individual differences are a lot bigger than any traditional statistical means of classification,” he explains. “If you can actually learn based on someone’s behaviour, you have a much better idea of what would be of interest to them.”

Two years into its AI work, in 2016 Mobify acquired Vancouver startup Pathful, a provider of machine-learning-based technology for behaviour-based targeting. The fact that AI talent was so close at hand was a big plus, McLachlan says. “That acquisition was specifically to acquire the technology and talent around AI.”

At this point, having AI is table stakes for business, he says. “It is becoming a key differentiator for a lot of tech companies. The differentiator for us is how we are able to get smart and train those algorithms, not necessarily invent them.”

Unlike many counterparts in recent years, Mobify has no plans to move head office operations out of the Vancouver region. “There are advantages to being here,” McLachlan says. “Historically the region has been underrated for its technology talent, but we actually have an incredible talent pool. UBC and Simon Fraser University are top-notch research universities. UBC punches over its weight class in terms of talent for its size.”

He acknowledges there had been a “bit of a brain drain” with grad students jumping to California, but the landscape is changing for the better. “It has been an easy jump for people here to make. But the ecosystem here has been exploding in the last few years in the way of incubators and big business making investments in here. Amazon, for example, is working out of downtown Vancouver.”

There is also a growing roster of investment initiatives from new incubators and accelerators to financing and R&D partnerships. Those investors are now concentrating their efforts in identifying talent and provincial opportunities to both attract students and capitalize on local expertise and talent, says Jérôme Nycz, executive vice-president, BDC Capital.

Vancouver’s increased its ability to retain talent, even when many interested investors are from the U.S., has been a boon, Nycz says. “We see a lot that are willing to maintain operations in Vancouver in their desire to keep teams whole. The quality of life is great and it’s one short flight from Silicon Valley and major west coast clients. Talent in Vancouver doesn’t walk away as easily these days.”

Better access to funding is certainly helping the cause. Mobify recently closed a funding round with BDC, after an initial round with Acton Capital [and Plaza Ventures] in 2015. “Up til then we bootstrapped,” McLachlan says. “We chose to take funding later. Now the funding environment is getting healthier. In fact, U.S.-based VCs with much larger funds are making investments in Canada.”

There is other movement afoot as well. The Expa Labs accelerator, which was started by Uber co-founder Garret Camp, chose Vancouver to open its first Canadian location and is recruiting the first group of entrepreneurs. Vanedge Capital, an early-stage VC fund that is currently investing in AI, cyber security, digital media and other “technology inflection points” in the region, is going strong. Creative Destruction Labs has opened a second accelerator in the city at UBC called CDL West to provide opportunities for students to work alongside entrepreneurs.

Scotiabank recently announced a $2 million donation to UBC to fund the Scotiabank Cybersecurity and Risk Analytics Initiative, that will include internships, speaker series, engagement activities (such as hackathons) and other collaborative events.

It’s part of a larger strategy with a number of academic institutions, says Michael Zerbs, Scotiabank’s chief technology officer. “We’ve really been impressed by the fact that UBC has very strong researchers on cyber attacks and specifically human and social issues relating to security and privacy. They are making strong contributions to financial risk modelling and statistics. I think we’re off to a very good start in Vancouver.”


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