Leonard Brody, co-founder of Vancouver’s NowPublic, one of the world’s largest networks of citizen journalism, does not think bigger is necessarily better when it comes to building a tech company.
That belief, which Brody shared with attendees of the Grow Conference during a speech last Friday, contrasts to the widely-held belief that Canada’s technology and innovation-driven sector needs more multi-billion firms acting as anchors to support the rest of the sector.
Brody has plenty of experience building and selling companies. He sold NowPublic to Denver’s Clarity Digital Group LLC in November 2009 for an undisclosed sum.
He was also part of the founding executive team of Onvia Canada, an e-marketplace company most known for closing a US$240 million IPO in 2001. Brody subsequently led the sale of Onvia’s Canadian operations to Bell Zinc Corp. that year.
Brody said, “You look at the Canadian press and media and politicians telling us that we are sore because we haven’t build big enough companies in this country.”
“We saw what happened to one of our biggest,” he added, referring to the dismantling of Nortel Networks.
He said 97% of Canadians are employed by companies that have less than 20 staff and that Canada’s relatively small economy makes it nonsensical to have multiple, multi-billion dollar companies.
“It makes far more sense to fund and grow strong middle-market and small companies that actually employ people and have longevity.
“We’ve shown that we can do it, shown that we can employ people in [the technology] sector, and we should really stop talking about building big multi-conglomerate companies.”
Brody also repudiated the notion that Canadian companies sell too early and too frequently to American firms.
“If you developed a great company and somebody offers you money, you should sell it if it’s good for you, good for your staff and your investors,” he said. “There’s no such thing as building companies and having exits that are bad for the country. You have no obligation, in my view, to this country to sell your company at any stage or state for the good of the nation.
"If you exit at a stage that you are content with and you had a good experience here, you will, in your own way, participate in the [technology-driven economy].”