Study of Alberta’s tech sector reveals surprising results
Findings reveal double the female participation than national average, a gain in new AB tech firms, and opportunity for seed stage startups
The emergence of new tech companies in the province of Alberta are making an impact on the provincial ecosystem, according to a recent study conducted by Calgary-based Alberta Enterprise Corporation (AEC).
The study found that 432 new Alberta tech startups were established since 2016, bringing the total number of technology companies with headquarters in our province to 1,238. These new companies make up 35% of the total number of Alberta-owned and operated technology companies. It was also revealed that female participation in the technology sector in Alberta is over twice the national average1. In fact, 30% of tech companies in Alberta have a female founder or co-founder.
According to Kristina Williams, President and CEO of Alberta Enterprise, this is one of several insightful findings uncovered in the 2018 Deal Flow study. While Alberta’s tech sector is still considered in its early stages of development, Williams noted the data shows it is maturing at a rapid pace. In fact, 70% of all Alberta tech companies surveyed are generating annual revenue (almost a 32% increase since 2016). Nearly one in four companies are earning more than $1 million annually. The proportion of companies with 10 employees or more has also increased by 38% since 2016.
“The objective of this study is to provide stakeholders with a shared understanding of the strength and make-up of technology companies across sectors, stages and regions in Alberta. I think the takeaway is that creating a viable Alberta tech sector is a slow and steady process, but one that is paying dividends,” Williams said.
The 2018 Deal Flow Study reveals some interesting facts about the makeup, evolution and distribution of technology in the province, maintaining positive trends from AEC’s last Deal Flow Study in 2016.
Among other key findings:
- 34% of Alberta technology firms are integrating Artificial Intelligence (AI) into their offering.
- 23% of firms report over $1M in annual revenue.
- 81% of capital funding raised by Alberta tech firms is from Calgary or Edmonton sources.
- 27% is raised from other parts of Canada; 24% is from the US.
- Alberta’s technology sector is largely concentrated in Calgary (767 companies) and Edmonton (394 companies), with 94% of companies operating in Alberta’s two largest cities.
- There has been a 38% increase in companies with 10+ employees.
- 63% of companies surveyed in 2018 report they have launched products. (Compared to 50% in 2016).
- Among technology companies operating in Alberta, the most common are software companies (40%), followed by life sciences (13%), clean tech (11%), energy tech (10%), and industrial hardware and materials (9%) companies.
- The average age of Alberta’s startup founders is 43.
- 71% of founders have previous startup experience; 84% have a technical background.
Smaller survey subset analyzes investment opportunity
As part of the broader study involving 1,238 participants, a smaller subset of 208 respondents were surveyed on investment opportunities in Alberta’s technology sector. Findings revealed Alberta offers significant early stage opportunity for tech investors, with 54% of companies surveyed at the Pre-Series A stage. 70% of Alberta tech companies surveyed are currently seeking funding and 58% are intending to raise more than USD $500K in their next round of financing.
Williams noted that the 2018 Deal Flow study was made possible due to the collective support from Alberta’s tech firms and numerous organizations that make up the Alberta ecosystem.
“Our growing tech sector is creating a more sustainable, diversified technology industry in Alberta: one where home-grown innovation is encouraged, and technology entrepreneurs have greater access to capital. As a result, we’re seeing more and more Alberta tech firms ready to take on the world.”