Il existe une différence subtile mais importante dans les manières dont les industries technologiques américaine et canadienne voient le monde. Les investisseurs américains accordent généralement plus d'importance au potentiel de croissance d'une entreprise alors que leurs homologues canadiens sont plutôt à la recherche du chemin le plus sûr vers la profitabilité.
C'était le sujet du plus récent événement Market Movers organisé par NATIONAL Marchés des capitaux. Voici un résumé de la conversation.
(L'article est en anglais.)
One thing you have love about Americans is their ability to sell a story. I was listening to one of my favourite podcasts—The Pivot—featuring shamelessly outspoken tech marketer Scott Barlow and tech journalist Kara Swisher, interviewing Andrew Dudum, the CEO of Hims & Hers Health, which went public on the NYSE in January via a SPAC, and now boasts a market valuation of US$2.5B with revenues of $150 million and a grand total of 150 employees.
When asked to explain his business, Dudum described it as “the front door for people to access healthcare.” There is intentionally no reference to “telemedicine,” which means nothing to the customer, says Dudum. Barlow, never a shrinking violet, said he thought Hims was all about erectile disfunction and hair loss. What they all agreed on however, was the inevitable transformation of healthcare delivery, and the “titanic” growth potential of “the biggest consumer business in the world.”
Watch the webcast
The conversation highlights a small but important distinction between how Americans and Canadians in the tech space see the world. In our latest Market Movers event: “The Tech IPO Boom: Built to Last,” guest speaker David Wismer, BMO Global Head Technology Investment, highlighted that for Canadian tech companies thinking about going public, U.S. institutional investors are generally more focused on a company’s growth potential while Canadians are looking for the surer path to profitability.
It’s an important distinction given that the majority of investors snapping up the barrage of Canadian tech IPOs coming down the pipeline are American, says Wismer. But ultimately, he notes, each company needs to focus on what is the right answer for its business.
If you missed it, I encourage you to watch my conversation with Wismer, a pioneer in Canadian tech investment banking, and Sean Silcoff, tech reporter for The Globe and Mail. We talked about the sustainability of the current boom in tech IPOs and the importance of the sector to the broader Canadian economy.
While Wismer acknowledged that the current pace of an IPO a week is not sustainable, both he and Silcoff are convinced that what we are seeing today is very different from the boom and eventual bust of the late ‘90s and early 2000s. Not only has the macro landscape changed, but the fundamentals of the businesses are better. Valuations may be frothy, but Canada can and should support many more tech companies, they say.
“We’re in early innings from the development of this generation of the Canadian tech ecosystem,” says Wismer. “If you are sitting at only 12% of TSX market cap in tech, for the health of the broader economy, it needs to be double that. We’ve got a long way to go.”
That doesn’t mean every company is ready to go public—there’s natural gestation period that can’t be shortened. Management first needs to ask the fundamental questions of why they want to go public and whether it makes strategic sense. “If the answer is, ‘well it’s a hot market,’ …that is a bit of a red flag,” says Wismer. “The road is long, and if you want to build an enduring, long lasting business, you have to think strategically long term. The IPO is just a financing event, but it’s very much the beginning, not the end.”
——— Andrea Mandel-Campbell était vice-présidente principale et leader, Marchés des capitaux au Cabinet de relations publiques NATIONAL