Start-up on Fast Track to Success
The Canadian Technology Accelerators (CTA) initiative helps Canadian companies with an existing technology, product or service explore opportunities in foreign markets.
This article was first published in CanadExport, the official magazine of the Canadian Trade Commissioner Service.
UNLTD VR of Montreal, Que. continues to make a name for itself after having worked on a television series and on a sequel to the popular Universal Pictures film 50 Shades of Grey. Today, the company lists the Canadian Technology Accelerators (CTA) in its own “credits” for helping it fast-forward into United States markets.
Founded in 2015, UNLTD makes high-end virtual reality content. It was involved in creating the promotional virtual reality (VR) experience for the film sequel 50 Shades Darker. The company shot all the live-action virtual reality scenes on the production of the film, and did post-production visual effects for the project.
One of UNLTD’s earliest VR content projects was a short VR series in Los Angeles for A&E Networks called Fall into Me, The British Billionaire, says John Hamilton, co-founder and CEO. “It was our first big break in VR.”
Receiving help from the Canadian Technology Accelerators
The start-up first has to engage investors, corporations and the media to get on board to finance, buy and publicize what it does. This is where the CTA program in New York comes in.
Developed and managed by the Canadian Trade Commissioner Service (TCS), the accelerator helps companies entering the U.S. or looking to expand into various U.S. markets ramp-up their businesses. The CTA initiative includes workshops and other resources, help from mentors, as well as experts in financing, marketing and more.
For UNLTD, the CTA has made the difference in the company’s success in engaging investors, corporations and the media.
“The CTA team in New York is really fantastic,” says Hamilton. His virtual reality content and technology company is among the current CTA cohort there. “They certainly supply a lot of great connections and advice. It’s been hugely helpful to us.”
UNLTD isn’t Hamilton’s first start-up. He has been an entrepreneur since creating a house-painting business in his university days, and he’s run a couple of highly successful film production, sales and distribution companies.
However, for start-ups, “everyone at every level needs a lot of help,” especially in a market like New York, which “can be overwhelming,” he says. “There are always new skills to learn, and things are always changing, so it’s good to get updated.”
Hamilton found VR to be a “whole new storytelling platform—it’s a new form of communication, really, because it’s so immersive.” On the business side, today’s fast-paced competition and new marketing channels demand new tools and techniques.
UNLTD joined the CTA with two goals in mind: to help it launch and develop new clients in the international market and to raise “Series A” financing. It benefitted right from the first CTA orientation session.
Refining your pitch
Participating in what’s known as a “hot seat” workshop, where a faux reporter grilled the company founders on why their firms are special, simulating an American media interview, Hamilton honed UNLTD’s message.
He also discussed with experts at BAM Communications, a San Diego‑based public relations agency with offices in New York, how to market a unique live-action VR series called Trinity that the company is producing.
“My pitch was most definitely better afterward,” says Hamilton, who within six days of the exercise was delivering it at the South by Southwest (SXSW) film festival in Austin, Texas.
There, with the help of BAM’s connections and reach, its message was picked up by a number of online media organizations, including the Hollywood Reporter, Forbes, Engadget and Yahoo Finance. “It was huge for us,” he says.
Learning to macro-manage
Joshua Kleyman, a trade commissioner and CTA coordinator in New York, overseeing the CTA digital program there as well as the HealthIT program based in Philadelphia, says the CTA has also helped Hamilton pinpoint what he needs to focus on.
“As a founder, John was doing everything,” Kleyman recalls. “We helped him realize that this was a waste of resources. He needed to start macro-managing better, so he could focus primarily on sales and production—his strengths.”
Kleyman says the goal of the CTA is to help companies with business-development efforts through sales, strategic partnerships and marketing. It provides other services, such as helping companies raise financing and capital, strategy consulting, branding, employee recruitment and access to resources.
“Being in New York, the CTA has a unique advantage. We are the centre of almost every industry: finance, advertising, media, news, real estate and construction, culture, retail, restaurants and education,” Kleyman says, commenting that New York “has a fast feedback loop” for companies.
Getting feedback from mentors
“Many people assume that the cultures between Canada and the U.S. must be very similar, but the business culture in the U.S. is much more informal, fast-paced and transactional,” he says.
“Potential customers will only give someone 20 minutes for a meeting before rushing off, and will be much more direct about what they need. It is definitely a cultural shock for many new companies, but something they quickly grow to appreciate and expect.”
Yolanda Wardowski, the lead mentor for the CTA, says the accelerator has a number of outstanding mentors who offer their time, feedback and counsel, and make introductions to their networks in New York and across the United States. Mentors represent a wealth of experience from diverse backgrounds, including senior corporate professionals and investors as well as current and former entrepreneurs.
Wardowski is Canadian, and a managing director at Avalon Net Worth, a private investment bank in New York focused on mergers and acquisitions, corporate finance execution and strategic consulting. She advises the CTA participants on strategy and scaling as well as investment. This can especially involve “turbo-charging” their value proposition and adjusting their target results.
“Early-stage companies that come through the CTA are successful in their respective markets in Canada. However that does not always translate into immediate success in New York City,” she says.
“The market is bigger and often more competitive, and the sales cycle is typically longer here. This requires that the entrepreneurs adjust their generic ‘sales pitch’ to a more targeted client focused approach. Most importantly, they need to position their company as a North America-focused solutions provider.”
Wardowski believes there is strong interest among the investor community in New York and the Silicon Valley in tech talent and research developments in Canada.
“However, U.S. investors prefer to invest in companies closer to them in the U.S., and as a result many Canadian seed-stage companies and/or their talented teams of engineers and scientists are lured away to develop their business in the U.S.,” she says, although this is slowly changing.
“After all is said and done, investors are interested in backing new and innovative technology or products that can have a positive global impact. The source of that investment, whether from Waterloo or New York City or San Francisco, is increasingly becoming a moot point.”
For nascent companies, “the key to successfully scaling any business is the people and the culture at these firms,” Wardowski adds.
Involvement in the CTA can help Canadian entrepreneurs validate their technology or service with U.S. customers and investors, develop a growth strategy beyond their local market, acquire customers, set up partnership deals and “aggressively position and promote their technology or product and their unique competitive advantage every chance they get.”
Increasing the awareness of your brand
Whitney Wells, an account manager for BAM Communications, which focuses on promoting innovative start-up firms, says the media responds well to Canadian tech companies. “Since many tech start-ups are based in Silicon Valley, it is often refreshing for press to learn of emerging foreign companies diving into the U.S. market,” she says.
“Media exposure should be part of any growing company’s strategy,” Wells comments. “Releasing timely, relevant news and reaching out to key trade media targets will create a media footprint in the U.S. that can drive increased brand awareness, visibility to potential investors and more.”
BAM is working with UNLTD on content, media relations, speaking opportunities, events and conferences. “Our ultimate goal is to increase brand awareness for UNLTD and generate exposure for the company’s founders,” she says, and it has had success at events such as SXSW, Virtual Reality LA., and the Cannes Film Festival.
Kleyman says that UNLTD is a good example of how a company should operate, noting that the company rejected the typical “start-up” mindset and went out to build a business.
“Instead of chasing a lofty dream, they pragmatically built a revenue-generating business, something practically unheard of in the U.S. tech industry, which allowed them to establish their position in the industry, generate cash to put towards other projects, and raise capital at a much better valuation from investors.”
Making an impression in a crowded market
Hamilton says the biggest challenge now for UNLTD is the sheer proliferation of companies involved in VR, which brings intense competition for investors and clients.
“There are always new names and faces in the market,” he remarks. “You have to differentiate yourself. You’re launching yourself into the maw and you're hoping you can make an impression. To do that in a place like New York is a one-in-a-thousand shot.”
There are also advantages to being based in Canada, Hamilton notes, with the low dollar and generous tax credits for foreign companies. Among the next steps for UNLTD is to further develop and market its technology in Silicon Valley. He will look for contacts there through the mentors the company now has in New York and will ask Kleyman to connect him with trade commissioners, and possibly the CTA in Silicon Valley.
Hamilton says the CTA’s assistance is critical for tech start-ups. “They have a lot of great connections with different organizations, mentors and experts,” he explains, while the TCS “validates” the company in meetings with potential investors and clients.
“The CTA eases you into the New York market. You can’t even measure the value of that.”