Earlier this week, an article that appeared in the Toronto Star stated that “The Canada Emergency Wage Subsidy program should be broadened to include high growth firms, software-as-a-service firms, firms whose revenues are seasonal or project-based and pre-revenue firms that are heavily invested in research and development.”
With economic confidence low, investment capital is drying up. Many of Canada’s highest-potential companies will run out of it in coming months. Without quick, strong government action, they will fail,” the article states.
We are now going to move into the next portion of our program where we hope to explore these ideas in further conversation.
Big-picture government response: The Honourable Mélanie Joly
“The first priority is to keep Canadians healthy, as we are all flattening the curve. We need to make sure people are able to follow the strict rules and strict recommendations of our public health officials. I would say this is our biggest economic measure—the more we’re able to flatten the curve on the health risks, the more we’re able to flatten the curve on the economic risks.”
“Our second priority is having a people-first approach. What we did was massively expand the definition of EI and we created a new benefit—the Canada Emergency Response Benefit. We wanted to expand the social safety net in order for people not to fall through the cracks and to make sure we wouldn’t be increasing inequities at the end of this crisis.” Melanie
“We also came up with the CEBA (Canada Emergency Business Account) program, which is for businesses that had wages between $20,000 and $1.5 million. I’ve never seen policies developed as fast as we’re doing right now. We know we have to be fast and nimble.”
Proposed solutions for government from industry leaders: Yung Wu
“I commend the government for acting quickly to mobilize a massive response to this crisis—leadership has been truly impressive. But I’d like to be really candid here because we don’t have time to be polite right now: Operationally, that response has fallen short and, in particular, it’s fallen short in the tech sector. Most of our most promising companies are not yet backed by banks—they’re not yet backed by later-stage venture capital firms. They’re pre-revenue and backed by angels or are growing their companies by acquiring new customers or markets. I recommend that the government immediately grant blanket acceptance into the wage subsidy program for founders and employees who are part of a recognized accelerator or incubator, or who are backed by angels from a recognized angel organization.”
Final remarks: The Honourable Mélanie Joly
“To thrive in the business world, you have to be extremely optimistic. My message to you is to continue to keep that optimistic approach and know that things will get better and we will be helping you cross the bridge to get on the other shore. The future will be brighter.”
Originally Recorded on April 16, 2020. Click here to join future roundtables.