Club Penguin | BCBusiness
Walt Disney's $350-million acquisition of Kelowna-based Club Penguin back in 2007 sparked a slew of tech buyouts from B.C.'s Interior.
Kelowna proves that not only can tech hubs emerge outside the metropolis, but world-class companies can thrive there
In 1991, I was in the health care field. Part of the job was outreach to let remote communities in B.C. know about the organ donor program. That year, I took a couple of two-week car trips through every part of the province and experienced the vast beauty as well as the far-flung cities and towns of the Interior. As a venture capitalist in the technology industry years later, I didn’t pay attention to technology startups from the Interior. I assumed, like others from bigger technology centres, that the remoteness made it impossible to grow world-class companies.
Imagine my surprise when Kelowna-based Club Penguin Inc. sold to The Walt Disney Co. for $350 million in 2007. Not even a year earlier, investors from Silicon Valley and Los Angeles had asked me about this amazing growth story. They wanted to visit the company and assumed that Kelowna was a suburb of Vancouver—itself very small in comparison to big U.S. tech centres. They assumed that everything tech-related happened in and around Vancouver. When I explained that Kelowna was a four-and-a-half-hour drive through the mountains, they were gobsmacked. How exactly could a company grow so big from what they believed to be the middle of nowhere?
But clearly something is going on in the Interior, as large technology company buyers are finding budding technology companies grown in places I thought were remote, like Kelowna and Trail. The question is: Have blossoming technology companies in the region put the Interior on the map? Since the Club Penguin sale, the Interior has churned out even more success stories, like Firebird Technologies Inc., a semiconductor company in Trail that sold to 5N Plus Inc. in 2009, and the appropriately named Vineyard Networks Inc. of Kelowna, which sold to California-based Procera Networks Inc. in January for $28 million.
Vineyard CEO and founder Jason Richards is a technologist who cut his teeth at the Interior tech success story Workfire Technologies International Inc., which sold for $58 million to Packeteer Inc. back in 2000. Bay area-based Packeteer kept the engineering team in Kelowna, which benefited Jason immensely.
Kelowna also has large private software company StarDyne Technologies Inc., which boasts more than $40 million in sales, more than 300 employees in the local government and has tapped into an underserved education software market.
Every region needs a committed leader who exhaustively spreads the word about its promise and its successes. The Interior has Steve Wandler, a passionate champion for the region, its technology development expertise and quality of life. He sold his Kelowna company, YourTechOnline.com, to a U.S. buyer in 2008 and was able to live in Silicon Valley during the transition. He learned the Silicon Valley way while in the Bay area, then moved back to Kelowna and helped found Metabridge, a mentorship and networking event group that connects Interior technology companies with Silicon Valley investors, mentors and advisers. Metabridge has successfully established, well, a bridge, which means that all roads to investment and success don’t necessarily have to come through Vancouver. Wandler created a dedicated organization that helps promote the successes in the Interior and eliminates the perception that great tech cannot emerge from there.
The Metabridge June networking event in Kelowna is now as much on the radar for Valley types as August’s GROW Conference in Vancouver. If you are reading this from the Interior and have not signed up for Metabridge events or mentorship, you should do so.
Almost seven years after the sale of Club Penguin, Bay-area investors now know that Kelowna is not a suburb of Vancouver.