Ottawa a natural fit for Vancouver-based VC’s new office, CEO says
By: David Sali
In a 20-year business career that has seen him tackle a variety of roles at various tech firms – including guiding a company from a startup to a successful IPO – Hugh Chow figured he had crossed just about everything off his bucket list.
Then came the chance to lead the Istuary Innovation Group, a Vancouver-based organization that acts like a venture capital firm with a twist: it also helps incubate the companies it funds, with the goal of taking them to exit within two years.
The company now has 19 “innovation labs” that act as incubators in Canada, the United States and China, employing more than 600 people.
“Istuary is a company that makes companies,” Mr. Chow said in a phone interview with OBJ earlier this week.
Since he joined the organization as its CEO in February, the Hong Kong native has witnessed firsthand the way it nurtures fledgling companies in a “scaleable, methodical” way. Istuary’s goal, he said, is to develop firms that are ready to market new technologies to rapidly growing global markets, particularly in China.
“I love growth,” said the self-confessed “geek at heart,” who was an engineer before embarking on a career as an entrepreneur. “That’s why I’m in this type of industry.”
He says Istuary, which recently opened an office in Kanata, flips the typical process of hatching a startup on its head. Instead of starting with an idea and trying to convince the market it’s worth buying, Istuary’s companies look to see what the market wants and then come up with products to fit those needs.
“We don’t just invest in ideas,” Mr. Chow said. “We start from the market first. If the market wants salt, I’ll give them salt. I think that’s really what sets us apart.”
Trying to predict what technologies people will be using a decade from now is a fool’s errand, he said.
“It’s like driving in the fog,” he explained. “If you don’t fall off the highway, you’re just lucky. We understand that.”
Istuary, which is funded by a mix of Canadian and American investors, currently has about eight startups in its pipeline, Mr. Chow said. Whereas many VCs believe they’re doing well if one in 10 firms they fund makes it, Istuary sets its sights much higher, he added.
“From Istuary’s standpoint, we look at it and kind of go, ‘It doesn’t have to be like that.’”
The fund has deep connections in China, he said, making it more likely to convert opportunities into acquisitions. One of its startups, a network technology company, was recently sold to a major Chinese firm, he said, and a couple of other deals with Chinese partners are in the process of being finalized.
“You can go on a lot of trade missions,” Mr. Chow said. “I’ve been on a few. It’s really hard to come back with a deal in your hand. We have the ground game.”
Though Istuary has only a handful of employees in Ottawa right now, he expects that number to grow to about 30 before the year is out.
The capital’s strengths in the semiconductor, Internet of Things and big data analytics fields make it a natural location for a fund like Istuary, he said, adding he’s looking forward to collaborating with officials at the Innovation Centre at Bayview Yards, which is slated to open in November.
“The stats speak for themselves,” Mr. Chow said. “There’s a lot of things going for (Ottawa). It’s the right environment. We need talent.”
Canada as a whole is a highly educated nation with world-class engineering schools, he explained, so there’s no reason why the country shouldn’t be a world leader in developing innovative, ready-for-market technologies.
“We have a lot of good things going in Canada,” he said. “I think we have a lot more to offer to the world than just oil and natural resources and scenery. We have some of the smartest people as well.”