Why some big tech fish are migrating to ‘small pond’ Victoria instead of Vancouver

Rising number of international companies are opening offices in B.C.’s capital

When Matt Celuszak’s London-based firm embarked on the hunt for a city in which to launch its global research centre for artificial intelligence, many global metropolises entered into the conversation.

But after passing on Melbourne and Singapore, the team at Element Human Ltd. decided on a city some might consider a little provincial: Victoria.

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“We needed a place to camp where we could be big enough where we actually get noticed on the local scene,” said Celuszak, a Victoria native now based primarily in the U.K.

“When I walk into Vancouver, I’m competing with EA [gaming developer Electronic Arts Inc.]. If I walk into Victoria, who am I competing with? And when you’re in the talent acquisition [process] in a very small field of highly skilled operators, who you’re competing with plays a role.”

Greater Victoria’s reputation in the innovation sector has been on the ascent recently, climbing three spots year-over-year to rank as the country’s No. 7 technology hub, according to CBRE Group Inc.’s 2019 Scoring Canadian Tech Talent.

The report measured the size of the labour pool, employment growth, quality of labour, educational attainment and talent quality to cost, among other factors.

Before Element Human opened its Victoria office last August, it first considered the benefits of Canada more broadly, such as access to talent, progressive immigration policies and the ability to tap into the federal government’s Scientific Research and Experimental Development (better known as SR&ED or “shred”) tax incentive program.

“We’ve gone from being a small fish in a big pond to a big fish in a small pond,” said Joel Windels, chief marketing officer for Seattle-based software company NetMotion Software Inc.

His company opened a new Victoria office last fall, building a team of 16 workers with plans to have about two dozen workers on the roster by the end of 2020.

“Victoria is really booming for software development and the programming world,” said Windels, a Briton who relocated from Seattle to open the Victoria office. “Really quite senior and talented people are moving to the city.”

NetMotion faces hiring challenges in Seattle like those of tech companies in Vancouver, where giants like Amazon.com Inc. and Microsoft Corp. can gobble up much of the talent.

To meet its growth objectives, the firm began looking at English-speaking jurisdictions in the same time zone that could meet its demand for talent.

This led to Victoria, where the tech workforce has grown 15.7 per cent over five years to 9,600 workers, according to the CBRE report.

Windels added that Canada’s immigration policies have been more “welcoming” than those in the U.S., and NetMotion has moved two workers from the U.S. to the Victoria office since launch.

“Donald Trump has done us a great favour,” said Dan Gunn, executive director of the Victoria Innovation, Advanced Technology and Entrepreneurship Council.

But beyond immigration policies, Gunn said international companies relocating to the province’s capital have displayed an interest in having a more distributed workforce across the world.

“Globally, the entire world is short of high-skilled talent, and so places that have a quality of life and quality of opportunity advantage are going to attract more of those people,” he said.

“Very few of our companies are in competition with each other. So their willingness to support and help each other is higher than we’ve seen anywhere else.”

But Celuszak said challenges remain for the relatively small city.

“The market’s moving faster than I’d hoped,” he said, referring to the effort to hire talent.

“The reality is the market pool is so small that if I spend a lot of money to transplant people in, immediately they’re going to get attacked by everybody in market.”

torton@biv.com

@reporton

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