Hardware Beats Software at NextBC Tech Showcase

Michel Laberge, General Fusion | BCBusiness
General Fusion founder Michel Laberge holds up his award at DigiBC’s NextBC high-tech showcase.

General Fusion wins gold for innovation at DigiBC’s first high-tech conference

Hardware and manufacturing companies made a clean sweep of the awards at DigiBC’s NextBC high-tech showcase on Thursday night. Out of 25 contestants for most innovative company, not one software or IT company made the top five, and General Fusion, a fusion-energy company still a decade away from selling a product, won gold.

NextBC was the first showcase from DigiBC, B.C.’s digital and wireless industry association. A panel of judges narrowed 25 nominees down to five, and then quizzed them on business models, strategies and philosophies to find a winner.

While the Vancouver tech market is better known for IT companies such as HootSuite, Microsoft and EA, the winners on Thursday comprised more builders than coders. D-Wave Systems, a quantum-computing company that constructs huge supercomputers for research and simulation, placed second. The bronze medal went to Avigilon, an HD video surveillance and security company. The two runners-up were UrtheCast, which strapped a camera to the International Space Station, and Captherm Systems, which promises to use water vapour to efficiently cool data centres.

Plenty of IT companies, such as Payfirma, Trulioo and Medeo, showed up to the event, but none made enough of an impact on the judges to take home an award. Only Fusion Pipe, a cloud-computing software company, won the audience choice award.

“We don’t do software; we do serious, big, nasty, beast hardware,” says General Fusion founder Michel Laberge. He says that while founding the company in Vancouver had more to do with ski resorts than strategic planning, the city turned out to be better than expected for turning out big hunks of steel.

“I started my company here, and there is not bad support,” he says. “You can find the machinists if you want to have a big piece turned around here. I think it’s actually the forest industry [that] has grown some pretty big hardware suppliers. They have big equipment in there. So we seem capable of having big hardware built here.”

UrtheCast’s director of technology Daniel Lopez, however, say that Vancouver is still a tough market to find the talent and materials a company needs. “It’s a lot harder up here,” he says. “Especially around finding the right people and capturing them and hiring them. Silicon Valley is still the best place for that.”

The judges grilled both General Fusion and UrtheCast about their business models. UrtheCast COO Wade Larson defended his ability to make money, saying the company could sell its high-definition photos of earth to everyone from governments to TV stations to app developers.

When General Fusion’s Laberge was asked how long it would take before he actually sold a product, however, he replied without hesitation: “Eight years.”

“That probably scared off a lot of in investors,” Laberge said with a laugh after winning gold. “I’m going to wait eight years to sell something? Software, you turn that out in one, maybe two years. Software is much more attractive. Hardware takes more time…. Software, you put five guys in a room and you feed them coffee and pizza and they produce the code. Here you have to make a big piece of steel and it costs a bit more.”

Thursday night’s winners reflect some real trends in B.C.’s tech economy, according to a BC Stats report released last month. The report says high-tech manufacturing GDP growth outperformed high tech services in 2012, 3.7 per cent to 3.3 per cent. Computer-related high-tech services GDP, in fact, actually fell by 0.1 per cent.

High-tech services still represent nearly 90 per cent of B.C.’s high-tech sector.