The Telus Ventures managing partner, long known for investing through a social impact lens, believes the COVID-19 pandemic offers a chance to reset industries in need of a shakeup
Based purely on his mood, you wouldn’t know that Rich Osborn is a man who—like most British Columbians—has been forced to stay home for two months because of the COVID-19 pandemic. We’re chatting over Zoom, and Osborn, the managing partner of Telus Ventures, is alert and energetic. You might even say he’s enjoying himself. For whatever reason, he seems excited.
Maybe he’s thinking about Beacon, the Toronto digital therapy company that recently launched a free product to support Canadians’ mental health through this crisis. Osborn is one of their investors. Maybe he’s proud of League, the Toronto- and Chicago-based wellness and HR tech startup that’s offering free trials of its Health Benefits Experience platform to companies in need. He invested in them, too. Or perhaps he’s thinking back to his smart seed investment in Akira, a provider of virtual health services then operating in Ontario, which was later acquired by Telus Health and now serves more than a million Canadians.
“I think it’s no secret with COVID that digital health has taken a great leap forward,” Osborn says. “I would say we’ve moved more in two months than probably in the last four to five years.”
OK, now I get the positive attitude. As the world rushes to build new tools to fight COVID-19 and help the planet, you might say that Osborn and his Telus Ventures team have an advantage, or at least a head start. Osborn has been investing through a social impact lens for decades. Companies he bet on earlier are now in the spotlight, and he might just be the best-positioned venture capitalist in B.C. to identify and judge the technology that’s going to get us all through this. Of course, that raises the question: How did he get to this moment?
Financial and social benefit
Osborn was born in Saskatchewan. He grew up in Ottawa, was educated at Queens University in Kingston, Ontario, and eventually made his way to B.C. He and his partner ran a successful restaurant in Whistler for a couple of years before he decided to do an MBA at UBC. There he met the founder of the parent company that created Maximizer Technologies and got his first taste of the startup world when he helped turn the struggling Vancouver-based company around, growing it into the biggest customer relationship management service in the world at the time. His business partner at Maximizer was a guy named Brent Holliday, and a few years into their venture, Holliday left to join BDC Capital as an investment manager. Osborn joined him soon after, kickstarting the investor era of his career.
Between the late 1990s and early 2000s, Osborn would leave BDC to start a Vancouver fund focused on early-stage enterprise software companies with operations in Canada and the U.S. He then spent two years as partner in a Lower Mainland–based midmarket private equity firm. But one of the most important things he did for his career was found the B.C. chapter of Social Venture Partners (SVP), what he refers to as “an operating foundation built around using financial tools to ameliorate nonprofit and social issues.” The idea was conceived by Paul Brainerd, a Seattle-based entrepreneur who aimed to target technology professionals interested in investing time and money in their community.
After learning about the concept during a trip, Osborn got to work as soon as he returned home, meeting with local tech leaders, foundations and investors. “It was my first exposure to this field of impact investing, in which you can have this dual lens of financial and social benefit,” he remembers.
Osborn connected with members of the BC Technology Industry Association, now the BC Tech Association, working with them to find individuals and organizations willing to fork over $5,000 in seed funding to launch the group. Early supporters of the model included Dave Mowat, then CEO of Vancouver City Savings Credit Union, as well as the Vancouver Foundation’s then–president and CEO, Richard Mulcaster. With several partners making multiyear commitments, the B.C. chapter, now called SVP Vancouver, was born in 2001. It was the first outside the U.S.
A perfect alignment
When Osborn returned to venture capital in 2010, it was as founder and managing partner of RecapHealth Ventures. This time around, he had a new filter to apply to his work. Headquartered in Vancouver, RecapHealth was meant to be a specialized health-care investor, and through it, Osborn aimed to infuse the social impact equation he had adopted into investment selection and value creation. “It was the thesis of not having to sacrifice financial returns to make societal benefit,” he says. “And in health care, there’s a perfect alignment of those two elements.”
Evaluating the RecapHealth portfolio in retrospect, you can’t help but conclude that Osborn had found his sweet spot. He made many deals, but his health-care innovation plays stand out. Osborn backed a Mississauga diagnostic services provider called CML HealthCare. It was acquired by Toronto’s LifeLabs for $1.2 billion in 2013. (Trivia question: Can you guess who the CEO of LifeLabs was at the time? It was none other than Sue Paish, now CEO of the B.C.-based Canada’s Digital Technology Supercluster.) Osborn also funded Medeo, an early innovator in virtual care. It was acquired by Kelowna-based QHR Technologies, a top electronic medical records company and fellow RecapHealth investee. (QHR was also eventually bought, in 2016, by grocery store and pharmacy giant Loblaws).
Five-and-a-half years after Osborn started RecapHeath, Telus Corp. came calling. The move to join a corporate venture fund may not have come across as logical to everyone in Osborn’s orbit. Why leave a nimble fund that you’ve founded to join a corporate behemoth, with all its bureaucracy and legacy operations?
Osborn tells me that there were three elements to his decision to join Telus Ventures. First, he saw an opportunity to operate an investment team inside a large organization and use the operational business teams to accelerate value in the investments. Second, there was a chance to continue investing in digital health but also to expand into the other areas that Telus focuses on, including the Internet of Things, security and what it calls the connected consumer.
Third, Osborn gravitated toward Telus’ focus on community giving: “It’s got a deep commitment to social purpose, and I really liked and appreciated that there was an organization I could work for and that really had that commitment as well.” As an example, he points to a recent initiative that saw the telecommunications firm donate 10,000 mobile phones and $0 rate plans to hospitalized patients and seniors to help the country’s most vulnerable stay connected during COVID-19.
Support from the top
Osborn is responsible for investing in technology solutions with the potential to drive growth and impact at Telus and support the corporation’s broader business priorities. His team’s effectiveness boils down to two things, he believes. One, most of them come from startups and other businesses, so they have what he calls “empathy with the startups.”
And two, he has support from the top. “CEO Darren Entwistle has a commitment personally to supporting us in our mandate and giving us the operating freedom to move quickly….Our job is to translate the small flywheel of the startup to the big flywheel of Telus,” Osborn says. “And we’ve figured out over time who the right people are and what the right buttons are to push to make things go faster. Because ultimately, that’s what we’re there for.”
COVID-19 hasn’t slowed Osborn down. In fact, like his portfolio companies, he focuses on doing what he can to create social and economic value during these uncertain times. As he did when kickstarting SVP Vancouver nearly 20 years ago, he’s thinking about how people and businesses can collaborate to make the most impact. “I think the opportunity…for a corporate venture fund, in particular, in this environment is really intriguing. We’re upping our activity level to do more investing because that’s what Canada needs—the entrepreneurial community and big corporates to work together to deliver solutions.”
When asked how COVID-19 is affecting his investment behaviour, he paraphrases Charles Dickens: “It was the best of times, it was the worst of times…the season of darkness, the spring of hope.” That quote, from the opening paragraph of A Tale of Two Cities, speaks to an age of contrasts and opposites—and, some might say, revolution. It reflects what we’re going through today. And while everyone knows there’s an unrecognizable post-pandemic world on the horizon, Osborn isn’t waiting for someone to hand him a map. He plans to draw one.
“This is just an unbelievable time to reset and restructure some industries that are badly in need of it,” Osborn says. “And as a corporate and as an investor, I look at that and I go, This is the time to be investing. This is the time to be hitting the gas, not the brake.”