Despite slower economic growth in recent years, China remains a market full of potential for Canadian companies. And for some Victoria firms, it may represent a massive missed opportunity if they don’t get into the game.
Owen Matthews sees China as a solid investment. Matthews is chairman of the Alacrity Foundation, which provides mentorship and guidance to start-up firms and engineers in order to create new tech companies.
A single city, Shanghai, with a population of 24 million, is better funded and has more wealth than Canada, he said.
Matthews, who is also a partner with investment firm Wesley Clover, said companies have the potential to be valued higher there given the availability of capital and the room for growth.
“Not being part of that in some way is a huge missed opportunity,” he said.
Matthews, who has just established a branch of the Alacrity Foundation in Shanghai, said China is starting to open up and the country is more open to technology partnerships in particular. But he warned it’s important for Canadian entrepreneurs to find a Chinese partner who they can trust.
“You have to have people you can work with, whose interests are aligned so when the Victoria company does well somebody there also does well,” Matthews said, noting that partnership is key as it can mean the feet on the ground in China will protect the firm’s interests.
The seven year-old Alacrity Foundation may be able to do some of that for Canadian firms. The non-profit entity, supported by industry and government, has branches around the world, including Turkey, India, France, the U.K. and now in China.
Matthews said each of the Alacrity branches gives interested companies an insight into global markets.
With its arrival in China, Alacrity’s network has trusted feet on the ground in Shanghai that can help open doors, or offer advice.
The mayor of Victoria hopes local firms are looking at the opportunity in China. Lisa Helps, who returned from a two-week trade mission to China in late October, told a gathering of local business people this week that Victoria firms are well positioned to take advantage of China’s potential. She said she believes the $22,000 trip was a huge success and has laid the ground work for trade deals to be signed with a country that is continually changing and opening up.
“The central government is focused on growing its economy in a sustainable manner and they need the innovation and technology we have here,” Helps said
Matthews said having the Victoria mayor join local firms on trips to China can open a lot of doors.
“It’s a great endorsement,” Matthews said. “It makes a big difference in China. Their assumption is government is a very important player in our economy. Having a mayor shaking hands beside a tech company goes a long, long way.”
It can also help the tourism industry, said Paul Nursey, chief executive of Tourism Victoria, who was in China at the same time.
Nursey said Victoria has seen strong growth from China — 20 per cent each year over the last few years — but it can do better.
“We have a great brand and a great product,” Nursey said. “But we are being more deliberate in targeting overnight stays.”
Nursey said Tourism Victoria has changed its sales team to be more digital savvy, and able to converse in China, as they go after a more lucrative slice of the Chinese market — the individual traveller rather than packaged tours. That’s a segment growing as a result of an emerging middle class. “Now it’s about the hard work on the ground and pitching, it’s a sales proposition and we have refined our sales approach,” he said.