Establishing a National Vision for Canada's Research and Innovation Ecosystem

Without a cohesive vision to guide policy development, attempts to fix the leaky pipeline between intellectual property generation and economic benefit are doomed to failure

I came across the 2022/2023 Report of the Advisory Panel on the Federal Research Support System. While it is too long for a full review here, I discuss a few points below from the lens of a deep tech founder working at the intersection of Research & Development.

The report correctly notes that Canada excels at the Research component of R&D among comparable countries, and notes a major gap in Development. In other words, Canada punches above its weight class in terms of raw scientific output, but does a poor job commercializing the results.

The success of our research strategy is largely thanks to a policy framework that uses federal-level funding policy to incentivize the right behaviors in universities. This effectiveness lies in a robust policy framework that incentivizes the right outcomes without prescribing how they are achieved: simplified, universities are rewarded with funding in response to fundamental scientific output while only minimal control is imposed on how they get it done.

The support ends there. We lack an equivalent system of incentives for effective commercialization of the results. Little extrinsic incentive exists for researchers to participate in the translation of their ideas to economic impact. Existing policy often actively discourages it, since combining university research with startup work is a conflict-of-interest management challenge that makes it difficult for inventors to participate. As a result, patents are often simply licensed out to third parties, with no standards on structure of those licenses. Many funding sources have FTE count and revenue requirements that push pre-revenue startups (i.e. deep tech) to seek support elsewhere. My company was lucky to have early revenue to get us across this gap. Most deep tech companies do not.

The report’s most important point is that Canada needs “a national science, research and innovation strategy to establish a common vision and objectives for Canada's research and innovation ecosystem and to achieve greater alignment across the players in the ecosystem.”

Where the report loses me is their suggestion to form yet another innovation support body to administrate the process of executing this vision. To my mind this is putting the cart before the horse: until the national vision has been established, it is not possible to design an organization that can optimally execute on it, and it needs to consider the input of every stakeholder in the process, including academics, venture capitalists, entrepreneurs, and those that administer the support programs. In order to respond quickly enough to the pace of technological change we are seeing today, any such framework needs to take note from the success of our Research strategy: decide on and incentivize the right outcomes, and trust that Canadian innovators will know how to deliver.