Back in June Mack reported on the Alberta Government announcing a three year, $178 million plan of research and development credits and a venture capital fund, among other things, to support Alberta’s high tech industry.
This week Suzanne Dingwall, lawyer specializing in emerging companies and a former VC and entreprenuer, wrote an interesting post arguing that the government’s funding will do more harm than good. Her core arguments: A) the $100M will be managed by a crown corporation, the Alberta Enterprise Corporation that will movely slowly and inefficently B) other funding will come to a standstill as it waits for the AEC C) the money does more to help VCs than tech companies.
What becomes clear is that the AEC is no lifeline to the high tech community; instead, it’s a nicely-sized government subsidy for venture capital funds who will agree to invest in Alberta…
It’s also a colossal mistake to assume that a share of a $100 million is appealing enough to attract top tier venture fund managers to the region. Which will further delay deployment of capital to new funds. Which in turn means there’s even less (not more) near term cash floating around for Alberta companies. I won’t itemize the other woes this approach creates, but those of you nearby know what I’m talking about. Those of you in Alberta who want more details, buy me a shot of scotch and we’ll talk.
I’m all for job creation, but job creation for fund managers and VCs is not going to boost the growth of the Alberta high tech community.
An interesting take. $178 million for high tech makes a good headline, but is it going to the right place, or is the PC Government just writing cheques for business friends?