Who will be Canada's next tech darling?
Those are six companies that will no longer be on the list of candidates to seize the top-dog mantle from Research In Motion (RIM), should it continue to falter. And it also illustrates one of the big challenges in the technology sector to come up with Canada's next high-tech darling.
Vancouver's Singular Software, Ottawa's Headwall Software and Halifax's GoInstant were acquired by larger U.S. companies, while Toronto's Scriptlance was taken over by the largest company in its field — the outsourcing and crowdsourcing marketplace — Freelancer.com, which is based in Australia
Two were taken over by other Canadian tech companies: Waterloo's Rebellion Media acquired Sortable and Montreal-based OneDesk acquired Ryma Technology Solutions.
Takeovers are endemic of course — and much discussed within Canada's vibrant tech startup community.
But as entrepreneur John Philip Green says, although there are "a lot of great stories to be told, a lot of people working really hard, really smart people doing world beater sort of stuff, the biggest obstacle to being the next RIM is just that people sell out so quickly."
Green has helped found and lead tech startups in Canada, the U.S. and India and is currently entrepreneur in residence with Hedgewood Inc., a private venture capital firm that focuses on the dot-com sector.
And while he observes that some of these recent takeovers may have resulted in impressive gains for their owners and investors (two-year-old GoInstant sold for a reported $70 million for example), they bring with them huge concerns about ultimate ownership and direction.
In 2010-2011, 77 Canadian tech firms were acquired by foreign companies, mostly American, according to Branham Group, a research firm that closely follows the tech sector.
San Francisco-based Salesforce.com, a leader in business software, has purchased other Canadian companies besides Goinstant. Last year, Salesforce acquired Toronto software company Rypple and Fredericton-based Radian6, which specializes in digital marketing.
For Green, who's been watching GoInstant since its earliest days, "it had the potential to be the next salesforce.com or RIM or Nortel, to be a big company. But it got snatched up by this U.S. company before it could hit maturity."