A bi-weekly column with timely, relevant and possibly irreverent insight into the BC technology industry. Something Ventured: February 1st, 2008 By Brent Holliday Greenstone Venture Partners A Look Back To The Future   “You are young and you are the future, So suck it up, tough it out, And be the best you can.” – John Cougar Mellencamp, Minutes to Memories In 1986, I was living my life at university in London Ontario, oblivious to the world beyond Southern Ontario where my friends and my immediate job (finishing university) were at hand.  A friend of mine from high school left that April for a fantastic summer job in Vancouver at Expo ’86.  She spoke French, so it was easier for her to get hired.  She had arranged to work a gigantic fair, get paid and explore the West Coast of Canada at age 20.  That was my first expansive thought as a near adult… I could actually go work somewhere other than Toronto? And so the bug started. My family went to Europe that summer (think the Griswalds in European Vacation) and I started getting excited about the big wide world that was a couple of years away for me.  When I graduated with a 4 yr degree, I got my first exciting job in, well, uh, ahem, Toronto.  But 18 months later I landed in Vancouver.  For me, the attraction was there from my friend’s summer job in 1986.  My “break” came when my girlfriend (now wife) got into teacher’s college at UBC for the 1990/91 school year.  Away we went. When I got here, we settled in, where else, Kitsilano. It was close to downtown and to UBC, the rent was reasonable and it offered the beach and a hip culture.  Before I attended UBC for my MBA in 1992, I had many friends around Kits.  Exactly 2 of them were from here. Everyone had escaped the recession in Ontario, Saskatchewan and even Alberta and come here to work.  Some were up in Whistler, including a good friend of mine who is now a senior guy at BOBJ/SAP.  He drove a taxi to start his career in BC.  In 1990, Vancouver had no obvious advantage over the rest of the country… other than its allure for young people: outdoor recreation, hip culture and no snow.  But young people came out in droves in the early 90’s. I didn’t know what a mountain bike was in Ontario, but then again, I didn’t know what a mountain was in Ontario.  Out here, we started zooming through forests in Whistler, UBC and the North Shore.  And we skied. And we went kayaking out in the Broken Group.  And we camped in the interior. Etc. Etc.  And everyone who is not from here engaged in the favourite pastime of phoning snowbound Ontario in late February or early March and telling how you were washing the car or going for a rollerblade.  I still do that, 18 years later. If I think back to that group from the early 90’s, almost all are still here.  One guy stayed for 11 years and is now in New York City, but he was the aberration.  What drew us out here as young people kept us here and we (not from BC) make up a significant chunk of the technology workforce today. Why the nostalgic look back?  Because I am living proof of the concept presented yesterday at a BCTIA lunch by Joseph Cortright, A Portland based consultant and authour of a study he called The Young And The Restless: Positioning BC in the Competition For Talent.  I just described to you my thought process and attraction to Vancouver 18 years ago when I was a 23 yr old, highly mobile, highly educated, hard working, cheap source of labour.  Joseph prefers the 25-34 yr old demographic to describe his Young and Restless, but I was just a little ahead of myself. If BC wants to build a larger more vibrant technology industry, it needs a long view and must attract talent.  In the short run, we can pick off some older more experienced senior managers to come here and work in existing companies.  But the solution for a strong future is to attract those that are easy to attract, the 25-34 yr old, single, educated, mobile worker.  They don’t solve today’s management issues as they are naïve and inexperienced (I merely think of my first job in technology in 1994 as being a poster boy for that comment), but they hold the potential for the entrepreneurs and senior managers of tomorrow (10 – 30 years forward). The best part of Joseph’s presentation was what I call the “duh” demographics.  It is so obvious that we forget about it…  In the last 30 years there was a labour surplus.  The boomers were in the workforce, women more than doubled their participation in the workforce, the percentage of people in the workforce with a 4 year degree was up dramatically from under 10M to over 50M in the US and technology was driving productivity gains per worker.  All of this meant that we carried a relatively high unemployment rate even as the economy expanded.  Now, the “duh” part, because it should not be news to you.  It is going to flip for the next 30 years.  My Mom is the first of the boomers (born in 1945).  She is 63 this year and represents the fact that for the next 30 years, the boomers will all retire, some early.  We may have reached the equilibrium for women participating in the workforce.  Joseph also points out that the rate of college/university graduation has plateaued as well.  There will be a labour shortage. And it will change the economy of North America. In the technology industry, more than any other industry, we need the skilled, educated, “creative” class of society.  We need those 25-34 yr olds that can move today and into the future to move to Vancouver. Good news.  We have what they want.  Joseph and his cohorts did study after study and many focus groups on what they want. They want vibrant, urban cores in cities with diversity, culture and recreation.  They want to move to places where there is a buzz.  In the early 90’s Toronto was not buzzing.  Vancouver seemed more hip, more edgy and so-not-Toronto.  Joseph describes the desirable neighbourhoods as “close-in” or less than 3 miles to the city’s central business district.  Kitsilano in the early 90’s was the place.  Now it is Yaletown and the West End with its incredible density and hip scene.  Soon it will be Gastown as well.  US examples of cities that have these desirable neighbourhoods are New York City, San Francisco, Seattle, Boston and Chicago.  In Canada, I would argue that Montreal is best, followed by Vancouver and then, yes, Toronto (which has improved its core immensely since 1990).  Have you been to Calgary, Winnipeg or Edmonton?  They roll up the sidewalks downtown at 6pm.  Nothing happens in the core.  In the US, think of Los Angeles, San Antonio or Phoenix for cities that have no hip, urban core.  These cities are in trouble down the road because this demographic does not move into the suburbs.  They get allergic near a minivan. Essentially, the message is Get Them While They Are Young, an interesting challenge in today’s Internet-driven world. Perhaps I shouldn’t hand out advice on how to market to this generation as I am a few years out of the demo and I am part of the immobile later generation. I have my house, my kids are in school and I live in the burbs.  I am what we want these young people to be… stuck here. And happy to be stuck.  Just hard to move out for any old job opportunity.  But if I was marketing to this group, I would be subtle.  When I was 23, I did not respond to any marketing campaign.  Vancouver was desirable because it was different.  It just has to remain different. Oh, and like the Expo ’86 attraction for this demographic, we should be reaching out across Canada to attract workers/volunteers for the Olympics.  It’s a once-in-a-generation opportunity to get people to come and stay.  Or at least tell their friends about it when they get home. Joseph told the story of an Intel executive in Portland after his presentation saying, “why do I want a bunch of latte-swilling, text messaging slackers” working for me?  Ok, he has a point.  Someone has to hire these people in the first place, or they won’t stick and get old like me.  The technology industry must be mature enough, with enough entry-level or mid-level positions to absorb this demographic.  There must also be a support network for the start-up because this wonderfully naïve demographic is entrepreneurial and can work 80 hours a week when they don’t have to drive to soccer, hockey and piano lessons and coach/volunteer/clean the house.  There time is their own… not their children’s or their spouses. Do we have the mature technology companies?  Do we have the support network?  These are things we can work on in the short term, but positive announcements like Microsoft moving here help.  BCTIA is about to launch their tech labour survey, so I can comment on the state of the technology market next time. I am one example of this concept of the young and the restless working, but back in the throes of the last recession.  It is much more apparent that we need to attract these people NOW and have them stick and become parents and move to the burbs before the coming labour crunch. See more on Jim’s work at www.restlessyoung.com.  What Do You Think? Talk Back To Brent Holliday Something Ventured is a bi-weekly column designed to supplement the T-Net British Columbia web site with some timely, relevant and possibly irreverent insight into the industry. I hope to share some of the perspective and trends that I see in my role as a VC. The column is always followed by feedback (if its positive or constructive. I'll keep the flames to myself, thanks). Something Ventured Archive Printable edition