Day 4 Evening - Ricard

Lead to Win

Lead to WinLead to Win

“Technology start-ups: Advantage Gatineau”June 23, 2009

Jean RicardEconomic development advisorDÉ-CLD Gatineau

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Agenda – ADVANTAGE GATINEAUAgenda – ADVANTAGE GATINEAU

• DÉ-CLD of GatineauDÉ-CLD of Gatineau

• Establishing a business in Gatineau, QCEstablishing a business in Gatineau, QC

• Financial benefitsFinancial benefits

• The BOTTOM lineThe BOTTOM line

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DÉ-CLD of GatineauDÉ-CLD of Gatineau

Mission Support entrepreneurs and organizations Stimulate Gatineau’s economic development

Strategic niches Integration of business, technologies and processes Language Technologies – Internationally renowned

2008 success story Leveraged $35M in investment for Gatineau companies Invested close to $1M 94 start-ups, 372 new jobs

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Over 60 information technology companies

• StAYTech : Solutions in IT Service Management

• Cactus commerce: Development of e-commerce solutions

• BlueBear LES: image detection software

• DIUM, Frontline Robotics, Multicorpora, Cogniva, Mtek Vision, Searidge, Mapleworks, etc.

A language technologies hub

• Language Technology Research Centre at UQO (LTRC)

• Over 60 language technology experts including speech recognition and knowledge management

• Close to 20 projects involving 20 external partners

The city of Gatineau - The city of Gatineau - Skills and Skills and Knowledge hubKnowledge hub

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Financial benefitsFinancial benefitsLocal incentivesLocal incentives

City of Gatineau Municipal tax breaks – 5 years (100% 1st 3yrs) Incubation fund (up to $15K)

Écho Capital Fund $15M regional fund for start-up & growth Up to $1M in loan or equity

FSO (Outaouais) $3M local government fund Loan or equity up to $250,000

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Businesses can cut R&D costs by half or more Considerable benefits to conducting R&D in Quebec Net advantage: Eligibility of indirect costs

Small Canadian-controlled Private Corporations

Provincial Credit Federal Credit Combined Credit1

Rate Refund Rate Refund

Ontario 10% Yes 35% Yes 41.50%

Quebec 37.5% Yes 35% Yes 60.94%

SOURCE: Invest in Canada Bureau, 20071. In calculating the combined credit, the federal tax credit is reduced by the provincial tax credit receivable.

Financial benefitsFinancial benefitsQuébec SR&ED tax creditsQuébec SR&ED tax credits

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M.D.E.I.E.

Multiple programs for commercialization and export PSVT: project-based loans and/or subsidies PSPE: subsidy for up to 40% of commercialization costs

for eligible products

Investment Quebec

CDAE: Reimbursable payroll tax credit of up to $ 20,000 Guaranteed bank loans for R&D investment claims

Financial benefitsFinancial benefitsOther Other Québec programsQuébec programs

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Financial benefits Financial benefits FFederal incentives for QC companiesederal incentives for QC companies

CED-Q for the Quebec regions Assistance to Quebec manufacturing SMEs Repayable and non-repayable contributions Grants (on occasion)

Industrial Regional Benefits (IRBs) Bid advantage on large Defence contracts with a presence

in Gatineau (Quebec)

Multitude of other programs (NSERC, IRAP, etc.)

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The BOTTOM line – it’s your $The BOTTOM line – it’s your $

Exemples $1.2M $500KAssumptions :

Total R&D salaries $ 600,000 $ 300,000 Total R&D contracts 200,000 100,000 Total capital R&D expenses 200,000 50,000 Total materials consumed/transformed 200,000 50,000 Total IT salaries (E-business) 200,000 100,000

Resulting R&D and IT tax credits

Quebec based $ 355,500 $ 291,531 Ontario based $ 278,000 251,750 Advantage Gatineau $ 77,500 $ 39,781

28% 16%

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Establishing a business in GatineauEstablishing a business in Gatineau

So why not Gatineau?- Is 5 minutes from downtown Ottawa- Has both OC Transpo and STO routes

- These routes also go to downtown Ottawa- Connections to Orleans, Kanata, South, Aylmer etc.

- Against major traffic flow across bridges- Has all the amenities of downtown Ottawa

- Junk / fast food, good restaurants, banking, parking, etc.- Costs are lower

- Rent is 25% lower than downtown Ottawa- Hydro is less expensive

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Establishing a business in GatineauEstablishing a business in Gatineau

MYTHMYTH REALITYREALITY

I have to speak French -Highest bilingualism rate in Canada

-Most speak the language of business

I’ll have to translate everything to French

-Bill 101 requires some French (signage)

-Larger companies require French web sites

I need to incorporate in Quebec

-Most companies incorporate Federally

-Need a Gatineau business permit

-Need to register “online” to Qc Business Registry

I’ll need to pay Quebec income taxes

Yes, Ontario residents get it all back at the end of the year

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Do your homeworkDo your homework

• It’s YOUR bottom Line

– It’s not just the product / service

• Prepare a business plan

– Include a market analysis and sales plan

– You’ll need it

• Maintain/expand your business network

– Including government agencies

• Ask for advice / guidance

– Consider governments as partners – they can help

– LTW, OCRI, Chamber of commerce, DE-CLD, etc.

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Questions?Questions?

How to reach us at DÉ-CLD of Gatineau

Yannick Bouchard: bouchard.yannick@gatineau.caJean Ricard: ricard.jean@gatineau.ca

www.directiongatineau.ca