Ninjas Wanted: What Canadian Startups Need to Win the War for Talent
The seeds of the startup talent shortage
First, the good news: The COVID-19 pandemic did not turn off Canada’s venture-capital spigot for tech.
As the virus coursed around the globe, driving high levels of anxiety and uncertainty, the confidence of many established businesses was shaken. That was doubly true for startup technology companies, which feared for their very survival. Would there be a new world order for venture capital? And if so, what might that new order look like?
The big surprise came in 2021: By the end of the third quarter of the pandemic’s second year, $11.8 billion had been raised — a blistering, record-breaking performance.
But despite all the fundraising and deal-making, Abdullah Snobar had a growing sense of unease. The executive director of the DMZ, the globally recognized Toronto startup incubator, saw a disconnect between the record-setting tech funding headlines and his on-the-ground observations of an unexpected pinch being felt by individual startups. The challenge? Winning the war for talent.
“When we talk about the fact that Canada is doing really well on the V.C. side, it’s not an inclusive statement or a blanket statement,” Snobar says. He points to a documented imbalance of support for seed financing versus Series A and B funding. The CVCA reports a telling statistic: Across the first nine months of 2021, 63 percent of V.C. dollars were invested in later- and growth-stage companies, a significant increase from 50 percent in 2019. Big Tech also took a huge bite out of the startup talent pool over the pandemic. As global restrictions blew away business boundaries and led companies to embrace a work-from-anywhere ethos, Shopify, Google, Amazon and Twitter began interviewing — and landing — new employees across different markets and time zones.
But the war for innovation talent is far from over. And startups have the power to deploy several unique strategies and tactics in the fight.
V.C. investment by the third quarter of 2021, a new record
of pandemic V.C. investment went to later- and growth-stage companies
of startups agreed that simply finding candidates to interview was their biggest talent challenge