Canada is rich in natural resources, yet too often finds itself stuck at the wrong end of the value chain. While other nations profit from finished goods, Canada exports raw materials and watches much of the value escape overseas. Keith Gillard, CEO of Sustaero, believes this cycle does not have to continue. In cleantech especially, he sees advantages that position Canada to capture more of the returns at home.
Unlocking Value from Canada’s Resources
Canada’s relationship with its natural wealth has been complex for more than a century. “Canada’s origin as a nation lies in its natural resources. These assets have been prized by industries worldwide as the beginnings of their value chains,” Gillard explains. The challenge is not access to resources but what happens after they leave the ground. “For over a century we have been stranded at the start of the value chain, where our customers are the ones realizing the vast majority of the value in the resources we export,” he says.
At the same time, Canada consistently overperforms in education and innovation. “Canada has several of the world’s top universities, is a leader in academic publications, and punches above its weight in innovation origination.” So why does the country lag behind? Gillard points to a single gap. “Where it has not lived up to that promise is in commercialization, which has largely fallen into the hands of our great southern neighbour.” In other words, the U.S. is the main one profiting from many Canadian ideas.
Leveraging Canada’s Cleantech Advantages
Gillard believes cleantech is Canada’s opportunity to rewrite its economic story. The country’s environmental reputation is more than just branding. “We have a reputation worldwide as tree huggers. We love our nature. We enjoy getting out in the woods, climbing mountains, paddling canoes,” he says. “It is a Canadian stereotype for good reason.” That image is backed by hard numbers. Canada leads the world in commercial forestry, ranks second in hydroelectricity, and sits third in commercially available fresh water. “These are the three inputs that drive Sustaero’s innovation and, in fact, anything in the forestry bioeconomy,” Gillard explains.
Culture plays a role as well. Canada’s diverse population brings fresh ways of looking at global challenges. “Canada has long been a hybrid culture, first between the First Nations and the English and French who settled here, and later expanded by immigrants from across Europe, Asia, Africa, and elsewhere. That mix gives us a truly diverse perspective for evaluating opportunities,” he says.
Securing Funding for Cleantech Growth
For Canadian cleantech companies, the real frustration begins after the breakthrough. Having world-class technology means little without the capital to scale it. “Impact is measured by actual change in the world, not by potential change,” Gillard stresses. “You could have the greatest invention that promises to clean the atmosphere overnight or deliver infinite free energy for all, but it has no impact unless it gets funding and becomes real.”
The challenge is not simply that Canada has less capital than the United States. The deeper issue lies in how interests are aligned among stakeholders. “I am convinced that at the heart of this disconnect between capital availability and realizing impact is a lack of alignment,” he explains. “It can be very difficult to align the interests of innovators and the funding organizations.” When early backers cannot work with new investors, or when fresh capital fails to understand what a management team truly needs, promising ventures stall. “Without alignment between all those parties, there is an inherent conflict,” Gillard says.
Building Long Term Cleantech Investment
Cleantech investment requires a very different mindset than software or AI. “It is true that the financial returns on cleantech investments disappointed many, but they did not disappoint everyone,” Gillard explains. The key is knowing what you are getting into. “There is a clear signal of strong returns in cleantech where the business model has been carefully designed to align all parties. Much of the noise comes from large capital projects that were not well thought out and failed, losing all investor money.”
The companies that succeed share a few traits. “Patient investors who are able to defend their positions, who are not forced by fund term limits or mandate changes to abandon their investments partway through, those who can remain in support of their cleantech investments can realize enormous gains,” he says. For Gillard, the smarter model is not traditional venture capital but pharmaceuticals. “Pharmaceutical investing can take a very long time and often has completely different stakeholders in the early innovation stages compared to the commercialization stages.” The approach works best when early and late-stage investors understand their roles and transition smoothly. “This has worked very well for both early and late-stage investors who play to their strengths and align their interests.” Canada has the resources, the talent, and the cultural advantages to lead in cleantech. The open question is whether it can finally capture more of the value from what it creates.
Connect with Keith Gillard on LinkedIn to explore his vision for Canada’s cleantech future.
