Canada the ideal North American launchpad for your tech business

Toronto waterfront by night.
 

27 November 2018

Nick Fleming / Trade Commissioner and Consul General, Canada More articles from Nick Fleming

Canada has long flown under New Zealand businesses’ radar. When most people think North America, they think the United States, and not the 37 million people north of the border.

That may change when the CPTPP free trade agreement comes into effect on December 30, reducing tariffs for exporters and providing enhanced options for service-based companies to secure Canadian visas for their staff.

Canada is the ideal next step for New Zealand companies which have earned their stripes in Australia. The Commonwealth connection makes it logistically and culturally familiar, the federal government structure makes operations in Canada’s provinces similar to Australian states.  For any New Zealand company looking to do business in the US, having a Canadian presence is a big advantage. A familiar accent goes a long way when dealing with the US, as does having Canadian customer reference points and representation in the same time zones. 

NZTE’s latest report shares more detail on the tech opportunities in Canada.

Xero’s Canada launch boosts its overall North American presence

Xero discovered the strategic importance of a Canadian presence when it incorporated here in February this year, expanding its North American footprint, which also includes headquarters in Denver, Colorado, and a hub in San Francisco, California.

Paul Churchman, the partner success manager at Xero Canada, says in just a few short months, Xero’s Canadian presence is already significantly boosting the company’s overall North American operation.

Last month the company signed a hugely exciting partnership with PwC Canada, which has significantly raised the visibility of Xero on this side of the world. Even though Xero is the largest global online accounting software company outside the US, it needed a partnership with a Big Four accounting firm to lift its brand recognition in North America.

“Having PwC endorse Xero’s presence here validates that we are the real deal,” Paul says.

Xero’s Canada launch proves how crucial it is for a company to bring over existing staff when it enters a new market. The Commonwealth connection has certainly helped with that: Xero already has 20 employees in Canada, including seven Kiwis and two Australians who have been able to share their successes abroad with the new team.

Storypark selects Ontario as its Northern Hemisphere base

Another New Zealand software company steadily expanding its Canadian presence is Storypark. Co-CEO Peter Dixon jumped on a plane to Canada in 2014, when Ontario province changed its curriculum encouraging more partnerships with parents - an ideal opportunity for Storypark’s education software. While he didn’t sign any clients on that particular trip, the meetings he had laid the foundations for successful partnerships. Being on the ground to do that was hugely important.

Storypark currently services Canada from its Wellington base with two part-time Canadian staff on the ground. Peter says the time-zone crossover makes it possible to respond to emails within the same business day, and there’s a short window for calls in the afternoon.

The company has plans to expand the Canada team, using Ontario as its base for Northern Hemisphere expansion; to the US, UK and Europe.

Peter says Canada felt like a natural step after Storypark’s growth in New Zealand and Australia, where they have partnerships with some of Australasia’s biggest players and a success story to share.

But, he cautions other New Zealand companies to note that while it is familiar, Canada is still a new market, with new systems and idiosyncrasies, and most importantly, a new accent. Storypark has worked hard to make its product look and feel as Canadian as possible, and operate in line with Canadian requirements. It has recorded all video content with Canadian voice-overs, and making sure all written material is in American English featuring local logos.

NZTE in Canada

New Zealand Trade and Enterprise is here to help our New Zealand customers gain deeper insight into the market and possibilities here in Canada, as well as to make strategic introductions. We are based out of the New Zealand Consulate General in Vancouver, and as Canada is geographically huge, work closely with the High Commission in Ottawa as well as honorary consuls in Toronto and Calgary. Canada’s fintech capital, Toronto, is covered by our New York based staff, again due to geographical proximity.

More information will soon become available around the benefits of the free trade agreement to New Zealand companies, and we’d recommend anyone looking to expand into Canada attends CPTPP events in their area. But nothing beats booking a flight to the market, and both the East and West coasts of Canada are now easily accessible from New Zealand.

I highly encourage any business looking to expand into North America to not forget about Canada in their investigations, and to tie in a visit if they are already attending an event in the United States. As our Canadian success stories testify, being on the ground is everything.

Read our latest report for more detail on the opportunities for New Zealand tech companies in Canada.