Thank you for inviting me here today. I really appreciate the opportunity to speak to the committee
Corvus Energy is a young clean technology company of approximately 50 people focused on providing energy storage systems, or large batteries, to the marine market. If you think of cars such as a hybrid Prius, or a fully electric Tesla, then that's what we do for ships by providing large, rugged batteries for ferries, tugs, offshore supply vessels, and other coastal vessels.
We have about 80% market share at the moment, and 95% of our product is sold outside of North America. With Europe having the most stringent marine environmental controls, and also being the decision-making centre for the global marine business, selling only in Canada was never an option for Corvus. I hope that sharing some of the challenges, and also the great support that we've had along our road so far, will be helpful.
Typically, if they can, it's much easier for a customer to purchase from a local supplier. If we look at ourselves, and our own supply chain, we always look to local vendors wherever possible. So to overcome these barriers and become a successful exporter, we focused on three things: firstly, having world-class products in terms of functionality, quality, and value; secondly, developing brand visibility in our export market so that potential customers know who we are and can find us easily; and thirdly, minimizing transaction risk, so that when they do sign a contract with us, customers are not concerned about dealing with a supplier from overseas.
So I'll try to focus on each of these three areas in turn, starting with the world-class products. SR and ED has certainly been invaluable in stretching the initial funding during the research phase of our company. However, our challenge now is in commercialization, and taking fuel data from generation one of the product and using this to develop generations two and three. I know that will ultimately be the base of our long-term success.
Being more and more focused on research, SR and ED doesn't really support this phase of development, but we've been very fortunate to be eligible for the Western innovation initiative funding that provides long-term, low-interest loans for commercialization activities. That's now a vital part of our ongoing success. And I think replicating this program across Canada, and targeting a higher portion of overall funding on the commercialization stage, versus research, would support many businesses surviving what is a very difficult phase in the growth of any young company.
Many of our overseas suppliers and competitors also have the benefit of core technology development and joint initiatives between national research institutions and industry, for example, ITRI, the Industrial Technology Research Institute in Taiwan; KITECH, the Korea Institute of Industrial Technology; or the Fraunhofer Institute in Germany. This foundational research is then released for either no, or minimal, licence fees for multiple companies to commercialize, and thereby magnifies the benefit. We found that due to the level of industrial relevance of research, working with universities in Canada has been less successful for us, and a focus on a similar model of industrial relevance in Canada might be helpful in enabling more successful technology commercialization.
Moving on to the second area, brand visibility, Corvus has received only a small amount of support in this area. Most of what we've done was achieved through our own funding and initiatives on the ground, and through contacts and supports provided by our financial investors. Supporting companies to attend relevant trade shows and find speaking opportunities in target markets would likely be very helpful. Reducing costs by having a Canadian pavilion the SMEs can be a small part of would seem like a very feasible first step, and it's also a model practised by one of our key investors.
To date, overseas trade missions have also had little benefit for Corvus due to the cost to participate, and their broad focus, and they may be more useful for larger companies. Bringing groups of buyers back to Canada targeted on specific industries and introducing them to SMEs may be more effective. Trade commissioners, on the other hand, have been invaluable in facilitating the next steps in finding partners, and the activities to embed commissioners within groups such as the CME have been very effective in providing a route to access this resource.
Finally, on the question of minimizing transaction risk, this can be split into two parts: technology risk and financial risk. Establishing reference projects for export customers and partners has been a key to overcoming technology risk. STDC provided Corvus significant support by funding a joint project with the Norwegian government. This left Corvus with an overseas demonstration project, a new export customer, and a core partnership with one of the largest marine engine manufacturers in the world.
This type of overseas collaboration seems to be unusual for STDC, which normally focuses on projects within Canada, but I think it would be effective, if driving export is one of the aims, if this type of overseas collaboration could be repeated for other export-focused companies.
Financial risk to the customer also has to be minimized. This can be achieved by providing foreign exchange hedging, letter of credit facilities, and creditor insurance to smaller companies. EDC has supported Corvus very well in this regard by underwriting the risks, which enables us to work directly with tier one Canadian commercial banks. This is critical. Without this support, it's unlikely we would have been successful in growing our export business. I would strongly encourage continuing these activities for other companies.
For export-focused companies, finding venture capital funding locally within Canada can also be hard, as exporters are perceived as a higher risk than companies focused on local markets. STDC has been very helpful in making introductions to North American funds. It would be good if they could extend their reach to Asian and European funds, who maybe have a better understanding of the export markets we're trying to reach.
Overall, there are an impressive number of resources available within Canada. However, it's daunting for SMEs to find and navigate them all. If access to these facilities were consolidated and a single point of contact provided to act as a guide so that all the resources could be made more quickly and efficiently available, the benefit would be significant.
I hope these thoughts have been helpful. I look forward to answering any questions.