Industry committee  Similar to Mr. Van Kesteren's comment, I do agree that there are aspects of the stereotypical Canadian attitude that are not necessarily conducive to successful entrepreneurship. But that is a generalization that is very often not true. And I do think there is great reason for optimism, because there are places in Canada where the attitude that is maybe generally lacking is certainly found in abundance.

Industry committee  I can speak to a couple of those. Maybe I'll leave the Waterloo question to Mr. Simoneau. SR and EDs are a hugely important government program for knowledge-based industries, and any enhancement is certainly welcome. It's not quite as good as venture capital, because it's refundable--you have to have the money before you can get it back--but certainly if you've raised some money and you want to have that take you down a longer runway, the SR and EDs are extremely important.

Industry committee  The point you're referring to is really an issue that cropped up in the mid-1990s, when a number of the labour-sponsored funds in Ontario raised way more money, frankly, than they were expecting to raise and that they could reasonably deploy, so the funds had too much cash and it took a while to work that off.

Industry committee  I have to take that on. The dollar has had a devastating effect on Canadian technology firms. When you think about the impact of the dollar, manufacturing comes to mind. But when you think about a young technology company, the chances are that most of its sales are in U.S. dollars, and if they're doing their R and D here, the R and D costs and personnel costs will be their biggest expenses, so the vast majority of their expenses will be in Canadian dollars.

Industry committee  It certainly has had a big impact. Now, think about it. Most young technology companies raise money knowing that in a couple of years they're going to have to raise more. They raise multiple rounds of venture capital, starting with the angel rounds and going through to the expansion rounds, so they know they're going to run out of money and will have to go for more.

Industry committee  I do have some ideas. First, partially to protect my precious five minutes, I specifically didn't put any recommendations in my presentation, but I think it's important that there become a broader general awareness of how bad the problem is before we lose ourselves in specific recommendations.

Industry committee  We currently have only a couple of investments in Quebec, and that's just due to the nature of the rules governing the pools of money we manage. We are currently out trying to raise a specialty life sciences fund, and as part of the terms of that fund we plan to open an office in Montreal and make some life sciences investments in Quebec, because there are great opportunities there.

Industry committee  It's a real challenge right now. In the first part of your question you alluded to banks. Probably venture-backed companies or angel-backed companies have been somewhat less hurt by the credit crunch than the economy at large because they don't qualify for bank loans to begin with.

Industry committee  --but there is not a lot of capital available for this industry right now. In part it's because lots of other sectors have done fabulously well and in part it's because technology has been, frankly, a very difficult place to make money for the last decade, as Mr. Simoneau mentioned a couple of times.

Industry committee  Thank you, Mr. Chair and members of the committee, for inviting me here this morning. I'm with VenGrowth, Ontario's largest venture capital firm. Since our inception in 1982, VenGrowth has invested over $1.1 billion in more than 180 small and medium-size Canadian businesses, mainly in the high tech and life sciences sectors.