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What's Inside
ED's Diary
These are some of the most important highlights of my activity in March:
March 3 – I came. I presented. I learned. I networked. Western Economic Diversification together with the The Canadian Trade Commissioner Service (part of the Department of Foreign Affairs and International Trade) asked me to present the state of our wireless industry in the McKenzie ballroom at Fairmont Waterfront Hotel to fifteen trade commissioners from South Korea, Taiwan, Hong Kong, China and Japan and thirty other business executives from the Lower mainland. I presented and fielded questions from the audience, such as: "What is our strategy to penetrate the China mobile market?" and "What specific actions is WINBC pursuing?".
I explained that we're currently exploring the Chinese market and are developing a strategy on behalf of members interested in that market. One specific action is the upcoming BC-Canada Tech Summit during the official opening of the BC-Canada Olympic Pavilion in Beijing (May 19-24). We're going to bring eight BC companies to showcase their wireless technologies and explore the potential of the market. Verrus Technologies, for instance, wants to meet with prospective Chinese partners to see if they can implement their successful pay-by-phone parking service in Beijing.
The half-day event was useful because trade commissioners from each country and region made presentations as well, filling us in on the specific differences of various markets. For example, Japan – with its 101 million subscribers and $85 ARPU - is not only a huge export opportunity for BC wireless companies, but 60 high tech Canadian companies already have presences in Japan. The Japanese are particularly looking for technologies that are "too advanced for North America". The presenter also mentioned that "Japan is the largest investor in China".
South Korea is another opportunity. After investing heavily in developing a sophisticated ICT infrastructure the country is now moving fast towards an ICT society. The main opportunities for our companies are in the areas of WiMax and WiBro.
Taiwan is another great opportunity, especially in the WiMax space. They have a program in place called "M-Taiwan" which has invested $220 million in WiMax. Interesting side notes: the iPhone is assembled in Taiwan, and the NRC is running the largest R&D program outside of Canada there. Every year, 140-150 startups go through the Industrial Tech Research Institute, which is Taiwan's commercialization engine.
David Bostwick, one of the trade commissioners responsible for China, shared with us a few names of Canadian companies doing business in that country, including PMC Sierra, Sierra Wireless, RIM, and Nortel (their R&D Centre for WiMax).
"Content is what the Chinese are looking for right now," said Bostwick. "But Canadian tech companies need to understand that they are dealing with the government of China".
In the last two hours of the event I had the opportunity to meet one-on-one with trade commissioners from each market. It was a bit like speed dating but I think I managed to raise their awareness of our industry and our needs.
If you want to learn more about any of these markets please contact me at michael@winbc.org or visit www.infoexport.gc.ca
March 3 – In the evening we held the MoMoVan event about Financing at Fasken Martineau. You can download the newsletter here.
March 5 – Met with Phil Heard (CEO), Nellie Cheng (Director Business Development) and the team at Vancouver Economic Development Commission (VEDC - www.vancouvereconomic.com) to give them an update of our status as an industry and to identify ways to create economic development opportunities in the future.
The VEDC works closely with the business community, all levels of government and other stakeholders, with a mandate to provide leadership in the definition and realization of Vancouver's economic potential, and to provide core services that promote economic development and job creation and retention for Vancouver. Wireless is considered a key sector in the economic development of our city.
We identified the following areas of collaboration: talent and job creation, attracting capital for growth and expansion, and expanding the Pacific Northwest Wireless Summit.
March 11 – Wavefront produced their first workshop in an LBS series with NAVTEQ. The following was covered:
- NAVTEQ company overview
- NAVTEQ data – capture, build and publishing methods
- LBS Basics – accessing location
- Available data sets for Vancouver
- Product roadmap: Discover Cities, Traffic, The Map Network, Community Content
- Working with NAVTEQ map data via MapTP
The conference room at the 2010 Commerce Centre was packed with developers interested in LBS. Tom Tierney from NAVTEQ did an excellent job presenting the latest his organization has to offer. He also made reference quite a few times during his presentation on their strategic interest in our wireless cluster and the profitable relationship they want to build with WINBC and Wavefront.
Based on the feedback I received from member companies like Verrus, Cypress Solutions and others, the event was a great success. Congratulations to Jim Maynard and his Wavefront team! We look forward to the next LBS event soon.
March 14 – Ms. Karimah Es Sabar, President of Life Sciences BC, invited me and Soren Harbel, VP Innovation Development from BC Innovation Council for a business dinner with Rajinder Bedi, Managing Director with the Illinois Department of Commerce and Economic Opportunity and Jeffrey Johnson, Managing Director with the State of Illinois Canada Office. We discussed business development and export opportunities for our companies. Since the US is the second largest market for BC wireless companies we will be looking at arranging a trade mission to Chicago late this year or early next year.
March 17 – It took us a while to finish the Leadership Summit Report from Day 1 of the Pacific Northwest Wireless Summit but it is finally here. The reviews are great. Please click here to download a copy.
If you attended our wireless summit in January and want to see it grow into an even bigger and better trade show, please click here to give us your feedback. Thank you!
Also, Caroline Lewko (Founder & CEO of Wireless Industry Partnership) has resigned from her position as Director of WINBC's board and as Chair of Wavefront. In her note she had this to say: "WIP has really started to pick up speed, but is still at a crucial time of its life of having to execute on slim resources. I feel my time and mindshare has to be focused on WIP, our clients, projects and partners...I've enjoyed working with all of you, some for many years."
We wish Caroline all the best in her new venture and look forward to working with WIP.
March 19 – Together with BCTIA, 2010 Commerce Centre and the rest of the partners we are working on final details of the BC-Canada Technology Summit, Beijing May 19-24. Eight (Chinese lucky number) BC wireless companies have registered for this once-in-a-lifetime event. They are: E-xact Transactions, Icron Technologies, Contec Innovations, Verrus Mobile Technologies, Wavefront, Handi Mobility, Empower Technologies, and GPS Industries.
March 27 – Attended "Mobile Mania: Show Me the Money!", the first Dinner Program in 2008 hosted on March 27th at Westin Seattle by the Washington Technology Industry Association (formerly WSA). I learned about such things as: the latest trends in mobile advertising, content, and open access; how small and mid-sized businesses are positioning themselves to compete in the mobile space; how large businesses such as AOL and T-Mobile USA are setting trends and structuring relationships with partners, and how entrepreneurs, developers, and start-up companies are disrupting the mobile landscape.
Speakers:
- Jai Jaisimha, Vice President of Mobile Technology and Product Development, AOL, LLC, a Time Warner Company
- Chetan Sharma, President, Chetan Sharma Consulting
- Brendan Benzing, VP Product and Marketing, Motricity
- F. Joseph Verschueren, CEO & Co-Founder, Formotus Inc.
- Ian McKerlich, Director, Mobile Web and Content Services, T-Mobile USA
Some of you may remember Chetan Sharma and Joe Verschueren from our wireless summit in January.
Chetan did a very good job at moderating the panel Thursday evening. I enjoyed the content of all speakers but liked Ian McKerlich's viewpoint on how important it is to understand the real needs of mobile consumers and develop simple applications that fit a mobile lifestyle...and also to remember your applications must make money for both the application developers and the carriers. He gave the example of "My five faves" service. Since they launched the service, more than 5 million T-Mobile USA subscribers have signed up for it.
I invited Jai, Ian and Brendan to PNWS in January 2009. Brendan Benzing congratulated me for the good job WINBC is doing at promoting the wireless summit. He remembered our online ads on MocoNews and suggested that Motricity should become a member of our organization. The timing couldn't be better: We are sending out notices to new and existing members as I write this.
I am now off to CTIA Las Vegas (April 1-3, 2008).
Please let me know your thoughts at michael@winbc.org
Thank you,
Michael Bidu, Executive Director, WINBC
Reminder: WINBC Membership now due
Keep BC's wireless sector strong...keep yourself involved and informed by renewing your membership today to WINBC. Renew your membership online.
Introducing two new WINBC Members
It's membership renewal time, and we're happy to announce that we also have two brand new members. They are:
Flextronics, a global provider of electronic manufacturing services, with several Canadian offices, one in Calgary and several in eastern Canada. We welcome the Calgary office. You can find out more at www.flextronics.com
NAVTEQ, a world leader in premium-quality digital map data found onboard most in-vehicle navigation systems sold in North America and Europe. Find out more at http://navteq.com
Welcome aboard! We hope you both find useful information...value...and even a little fun through being members of WINBC.
MoMoVan Alert: Register now for April 7th!
Topic: Entrepreneurship and Going to Market
Come hear a panel of successful entrepreneurs and others who know the challenges, intricacies and disappointments – but especially the excitement – of taking new products to market. There will be lots of time for networking, plus you’ll also hear two or three new pitches, and enjoy free pizza and a complimentary glass of Granville Island beer.
Time: Monday, April 7 – 6:00 p.m. to 8:30 p.m.
Location: Granville Island Brewing – 1441 Cartwright Street
 For more information and to register
WINBC: Member Profiles
Contigo Systems succeeds with growth round financing
Just days ago, Contigo Systems, Inc. announced it had succeed with its recent round of investment financing.
Contigo Systems Inc. has developed a number of GPS-based mobile monitoring applications targeting both consumers and businesses.
Rather than a one-size-fits-all approach, Contigo develops specific products for specific purposes, and has partnered with a variety of wireless carriers, software developers and manufacturers to create its unique line of products. Those include panic-button equipped products for personal safety, to larger scale applications for fleet monitoring.
Recently, Contigo partnered with DeWalt to produce the DeWalt MOBILELOCK to provide security for assets, heavy equipment, construction site storage and portable containers.
$3-million C-round financing
To sustain their fast-paced research, development and marketing, Contigo has been working non-stop to raise capital. In late-March their efforts were rewarded with $3 million in new investment.
"This was our C-round," says Rob Goehring, Contigo's Co-Founder and Vice President of product management and marketing. "Our success was largely the result of groundwork we laid during our B-round. Most of those investors returned, along with a couple of new angel investors."
Contigo recently pitched their company at the Service Provider Investment Forum (SPIF), held as part of WINBC's Pacific Northwest Wireless Summit last January.
Enjoyed pitching at SPIF
"We really enjoyed pitching at the SPIF," says Goehring, "although we didn't get any introductions there for this round of financing. But we did get to network with people from local and overseas carriers and they may well play a part in our next financing round."
One investor that came back for the C-round was BC Advantage Funds, which bills itself as the largest venture capital corporation in British Columbia.
Returning investors the key
"They were our first VC investor," says Goehring. "They and other previous investors liked what they saw from their B-round participation and were quick to come back again."
Another key investor who returned was Greg Peet, former President and CEO of A.L.I. which, under Peet's guidance, grew from a small R&D company to one that sold in 2002 for over half a billion dollars to the healthcare services giant, McKesson.
Peet, recently celebrated as the BCTIA's Man of the Year (2007), sits on Contigo's board was instrumental in leading the company's last two investment rounds. The capital they raised this round is slated for growth – to develop new products and new channels, and to expand Contigo's sales and marketing activities.
Start early, be patient
Goehring's advice to other companies wishing to succeed in capital markets is precise: "Start early, be patient and persistent, and look for the right partnerships, not just the first ones that present themselves. You have to be able to develop great working relationships with your investors, which means you need to find ones with an interest in the kinds of things you're doing."
Iamota raises $1 million for digital media
According to the Digital Media Industry Newsletter for this past February, 67 private digital media companies worldwide announced $569.9 million in venture capital financings during that month. The investments were primarily in the advertising infrastructure, content publishers, and applications sectors.
One of the companies on that list (and one of only two Canadian companies) was the Vancouver Mobile Application Service Provider, iamota (for 'I am over the air').
iamota provides a number of modular applications to provide secure and robust mobile marketing, messaging and payment processing services to online merchants, ad agencies and individual mobile content providers.
In February, the company announced it had raised approximately $1-million in seed funding, starting with local investments from its founder, Pete Smyth, its management team, and from friends and family.
Text-book financing
"It was text-book," says Pete Smyth. "Initially, the money came from me, other members of the team, and local angels, people who knew and believed in us. We also went after match funding from NRC/IRAP, and after EBC eligible tax credits, to make ourselves as attractive as possible to investors. Overall, we raised nearly $750,000 locally for product development, without a lot of difficulty. But the final $250,000 was too difficult to raise locally, so we went after US investors."
He was surprised at how easy it was, relatively speaking. US investors readily understood iamota's value proposition, and were eager to partake in the company's early stage development.
US investors like early stage companies
"They wanted to get in early, while the company's valuation is lower. Local investors, however, want to see a company with more traction, with four to six key customers and some revenues. In the US, we raised the money we needed within weeks, rather than months. And we didn't pitch at angel forums, but instead researched and went after specific angels."
Smyth says iamota has been successful because the company has adhered closely to the "three T's" of Team, Technology and Traction. He also noted that the company created a track record of being very capital efficient: "We make every dollar count and do a lot with a little."
Reclaiming Canadian talent
iamota is now going after Series A funding to commercialize its products and services and to sharpen its focus on sales, marketing and channel strategies. Recently, the company attracted Mary Lou Hardy back to Canada as its Executive Vice President, Marketing and Business Development.
"That's quite a coup," says Smyth, "since she's spent nine years working in the US, most recently as Director of Global Marketing with AOL Mobile's B2B division in Seattle."
On demand services a 'hot space'
Says Smyth: "We're in the on-demand services space. It's a hot space, so there is a lot of interest, especially from the US. The mobile channel is evolving in much the same way as the Internet channel did in the 1990s. However, the interest is shifting to more established companies, which is good for us, since we've been doing this for four years now. Currently, we're partnering with several large agencies in Los Angeles, New York, Seattle and other cities, helping them reach consumers."
Wireless News Bites
Taxes, education, lifestyle are keys to technology growth in British Columbia
BC enjoys the lowest corporate tax rate of any jurisdiction in Canada and the USA, and that is one of the key reasons why the technology sector here continues to enjoy strong growth.
Those were the comments made recently at a meeting of the Vancouver Executives Association by BC's economic development minister Colin Hansen.
He noted that "The greater Vancouver area now employs more technology workers than greater Seattle, which is home to Microsoft."
He also noted that Microsoft recently opened an office in Vancouver to get access to our well-educated students, for easier access to talented immigrants, and because of Vancouver's varied and extensive lifestyle amenities. Low corporate and personal income taxes also figured strongly in Microsoft's decision about where in Canada to locate their new office.
Mobile advertising goes to the movies
Writing in Media Post's Mobile Insider (March 25, 2008), Steve Smith reports that a mobile advertising campaign for the movie "The Signal" was performing exceptionally well. The campaign had cell users call a number to hear a recording of a noise that, in the movie, turns people into killers.
Smith reports "the clickthrough rate on the mobile banners was 6.7% and 16% of those CTRs went on to call in to listen to the signal." A further 14% of those who listened passed on the link virally.
82 million recall mobile ads – but not the ones you might think
Mobile Insider also reports (March 27, 2008) that the quarterly Mobile Advertising Report, just released by Mobile entertainment company Limbo, contained this significant stat: The report's survey of 1,000 mobile users found that 82 million U.S. mobile subscribers say they recall seeing a mobile ad in the last three months, up from 78 million in the last survey. Forty-one per cent of those who recalled seeing an ad also recalled at least one brand, up from 34% the previous quarter.
The highest recall was for mobile ads by the carriers, followed by providers of such content as ring tones and games. Surprisingly, according to Limbo, "There was a long tail of brands receiving very low recall scores, including NBC, Yahoo!, MSN, Lincoln, United Airlines, Nissan, Coca-Cola, McDonald's, ESPN, AOL, Nike and Overstock.com."
Upcoming Wireless Events
April 1–3 - CTIA Wireless 2008 in Las Vegas
Billed as "the Most Important Global Technology Event of the Year!" Expect more than 1,100 exhibitors and over 40,000 delegates from 125 countries all working toward the common goal of revolutionizing wireless. For more information, visit www.ctiawireless.com
International Trade Canada invites Canadian companies to join them in the Canadian Pavilion at CTIA Wireless 2008. For more information, contact: Charlene Wheatley; Foreign Affairs and International Trade Canada, (613) 944-8823; charlene.wheatley@international.gc.ca
April 13–17 – International ICT Expo, Hong Kong
The Government of Canada, in partnership with The Hong Kong Trade Development Council (HKTDC), invites Canadian companies to participate in the International ICT Expo (http://ictexpo.com) at the Hong Kong Convention and Exhibition Centre. Companies will have the opportunity to exhibit in the Canadian National Pavilion, and/or join the programme of Information and Communications Technologies (ICT) Partnering Mission. Click here to download a PDF application form.
April 14–16 – Orange Partner Camp, Faro, Portugal
Join Orange for their 7th award winning Camp. The philosophy is simple - 3 days of interactive presentations, workshops, sessions, coding, 1-2-1 chats, speed dating and contests...helping you and Orange to drive innovation forward, and into the hands of mobile, broadband, fixed and IPTV customers. Click here for more information.
May 19–24 – BC-Canada Technolgy Week in Beijing
This is the place to be if you want to create or solidify business connections in China. The BC-Canada Pavilion will remain open through the 2008 Olympics and is expected to host over 500,000 visitors. For information on how to register please contact michael@winbc.org
June 9-13 – Canada @ Interop Tokyo 2008
Interop is the leading global technology event, bringing together ICT and business leaders to see all of the latest technologies in action. Visit more than 300 exhibitors, attend 70+ sessions and check out live demonstrations of tomorrow's business solutions. For information please visit Interop Tokyo.
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