Thank you, Madam Chair, and thank you to the honourable members of the standing committee for letting me make some comments today.
I take the subject of entrepreneurialism and entrepreneurship in Canada extremely seriously, especially the cause of helping them continue to grow.
Today I'd like to address and focus on three points. The first is that the existence of the women's entrepreneurship strategy is a good thing, but it can be improved. The second is that getting to the point of export requires growth and scale, and this part of the entrepreneurial journey warrants more government attention. The final thing is that, given U.S. protectionism, Canada must review the fundamentals of our business environment. Decisions that promote investment and entrepreneurship must be prioritized.
I will focus on the women entrepreneurship strategy. In 2014 I submitted a report to the government about women entrepreneurship. I thought then, as I think today, that in a perfect world there wouldn't need to be a women entrepreneurship strategy, but it responds to our real bias in private and public sector investment, and my hope is that over time this bias will be reduced.
That experience spurred me to establish District Ventures Capital as well as the Venturepark business growth ecosystem, both of which support entrepreneurs in the food and health industries. The ecosystem has driven close to $2 billion in economic impact since its inception eight years ago. That support tackles two persistent Canadian policy problems: our propensity to send our raw agricultural goods overseas, where value is added and jobs are created elsewhere; and the historic lack of support for women in entrepreneurship that comes in investor financing and social bias, all of which block women and often discourage or dissuade them from starting a business venture.
The government has supported District Ventures Capital through SCC, BDC and EDC. They are part of our capital fund. The government has helped to evolve the support system for CPG entrepreneurs in Canada, and that's a good thing.
A small criticism here is that those programs are uncoordinated. This also seems to be the case with the women's entrepreneurship strategy. Entrepreneurs are grateful but frustrated at having to look under a lot of different rocks for funding and not meeting criteria designed to create roadblocks to ways forward. Too many restrictions on too much funding means the majority of capital is being deployed into very tight sector circles. What would get better results is looking beyond the tech and energy sectors and supporting the health and food industries more. These are industries predominantly led by women entrepreneurs.
A big issue stems from the lack of investment support in total for women entrepreneurs. Only 4% of all VC funding goes to women founders, who represent 50% of the population. We need to change that, not just for the sake of equality but to ensure larger social goals. Female-founded businesses tend to be more sustainable, and they tend to address skill gaps more consistently. Many private sector funds also include public capital. These are partnerships where the government could enable change efficiently and under merit-based rules. There remains a lack of accountability in government programs to ensure enough funding is deployed to worthy females and women-led businesses.
There is also a difference between starting a business and scaling a business. Governments often support early-stage entrepreneurs, but funding for growth and acceleration remains a challenge. Canadian entrepreneurs do not expand internationally if they have not achieved scale in Canada. Larger sources of capital are instrumental if the entrepreneur is seeking to thrive in export markets. Growth capital can't just be public funds. At best, it is a private sector investment. We need to do more to spur that private sector investment in scaling high-growth businesses.
Finally, on American protectionism and Canadian growth, my last point surrounds the deepening American protectionism that will affect Canadian entrepreneurs. As a country, we do not have the might to match beautiful tariff for beautiful tariff, nor would that be a smart approach.
We need to double down on growth at home, and we need to see women entrepreneurs as critical to that growth. That growth will happen only through high-growth entrepreneurship.
We need to declare support for entrepreneurship and then make changes to show it. That could involve things such as less red tape, fewer costs for starting a business, low or no tax on first revenue in a new business up to a certain amount, tax credits on investments in first-time entrepreneurs, reduced provincial trade barriers and revisiting changes to the capital gains tax.
This committee should also consider policy changes that would bring more women into entrepreneurship. My suggestion there is a more generous tax benefit for private sector investment in first-time women entrepreneurs and the businesses that support them. If the whole ecosystem can be rewarded for the right behaviour, we'll be that much further along. These ideas would send a clear message that Canada supports entrepreneurship and that Canada supports women in entrepreneurship.
Thank you, Madam Chair.