ShaneMcLean.com

Information on legal and business topics from Canadian business lawyer Shane McLean

LW Spring Quarterly

Posted by Shane McLean on May 29, 2009

See below for LaBarge Weinstein’s quarterly newsletter:

Spring Quarterly 2009

“So how is business?”… a question asked of us time and again in the last few months (so much so it came to rival “So when are you due?” as  the least popular question for our tax aficionado and most recent maternity leave departee, Estelle Duez). Looking for solace? Or for the grim satisfaction of our confirmation that the economic world as we knew it is no longer? We’re afraid we’ve only optimism to offer up, and here is a taste.

First, both the Ontario and Quebec government have made significant commitments to re-seeding our lagging venture capitalists. In March, Ontario announced a $250M matching fund for later stage investments, and our partner Debbie Weinstein had an opportunity to sit in with representatives from the Ministry of Research and Innovation this past month in their Province-wide  soul-searching effort, and see the attached link to check out her thoughts on the initiative. Quebec’s plan is even more audacious, with over $1.2B committed to creating the foundation for what they hope to be Canada’s premier venture financing and tech entrepreneurship ecosystem (with, we’re told by the folks in the know like Austin Hill, a Canada-wide and global vs. Quebec-first or Quebec-only investment horizon). 

Second, while we all look forward to a boost in valuations over the coming year, our M&A activity during the quarter has been particularly strong, with Trend Micro’s acquisition of Third Brigade, High Road’s acquisition of Accentus and Wind River’s acquisition of Tilcon Software leading a healthy compliment of transactions completed by our folks in the past few months (see “Dealflow” below).

Finally, and perhaps more significantly in the long-term, we’ve recently connected with a new breed of tech deal makers, differentiated principally by more fluid, less capital-intensive, LP commitments, and a greater sleeves-rolled-up operational and strategic role. For some input on the gaps that these folks fill relative to traditional funding and incubation models, check out the perspectives offered up by Extreme Venture Partners’ Amar Varma, and Basecamp Partners’ Robin Axon. Coupled with the provincial government commitments and a renewed energy among management teams across the country, we’re all looking forward to the balance of the year.

So what does Warren think…

Some of you might have digested a recent blog post from one of our partners James Smith contrasting the buoyancy of the recent mesh show in Toronto with the gloomy mood from “A Night With the Bears”, a market hand-wringing event hosted by Eric Sprott in early April.  We had a chance to follow up with Ottawa-based broker Chris Fewster, who attended the Sprott event and followed it up by attending Berkshire Hathaway’s annual meeting in Nebraska. View Chris’ comments below on Warren’s views regarding technology markets, see the attached link, and see a recent report of his investment in a Chinese electric car and battery company, BYD.

Smartening up the grid…

Some significant pronouncements in the last few months are bringing tears to the eyes of those folks, especially in Ottawa, focused on retooling traditional telecom skillsets for the cleantech arena. In February, Google unveiled a beta version of software that works with smart metering hardware to profile home energy consumption on an applicable-by-appliance basis. Just this past week, Cisco trumped this announcement by confirming its loosely-secreted commitment to focus on making communications equipment for the electricity grid, positing in the process that the grid will be 100 to 1000 times the size and scope of the internet. What does it all mean for us? We asked Toronto-based Albert Behr of Behr & Associates for his perspective, and see the attached link for his feedback.

LaBarge Weinstein in Waterloo and Toronto…

As many of you are aware, LaBarge Weinstein has had an office in the Waterloo region since January 2007, and we’re proud to announce the opening of our Toronto office as of June 1st. Check our website for details, and look for our professionals circulating more frequently in each of those tech communities looking to supplement our already strong institutional connections with improved reach and relationships with southern Ontario’s leading tech entrepreneurs. For more information on our efforts, feel free to contact James Smith of our office ( js@lwlaw.com ) and he would be happy to assist.

Blogs & Other

We’d like to congratulate a couple of new presidents of tech organizations in the Ottawa area, first Claude Haw appointed to run OCRI, and second Rick O’Connor tagged to run The Ottawa Network. We look forward to working with them both, and to each organization’s continued commitment to tech entrepreneurship in the Ottawa area.

Each of Claude and Rick might want to check a great article in a recent edition of the Economist describing the “Five Myths of Entrepreneurship”, a must read for anyone looking to focus on ways to improve the results of our tech ecosystems. Thanks to Ottawa-based CFO Mike Van de Water for passing this on.

One of our partners, Shane McLean, has recently launched his blog at www.ShaneMcLean.com. Shane is hoping that the content will appeal to our clients and to the business community at large. Please check it out and let Shane know what you think ( smclean@lwlaw.com ). Thoughts, comments and suggestions for topics are all encouraged and always welcome.

We wanted to highlight a great Globe & Mail interview with Waterloo-based Tech Capital’s managing partner, Tim Jackson, which is further soup for the tech soul looking for healing in these tough times. If you are actually pitching your business to external investors these days, check out a terrific video of David Rose’s “hearts, heads, wallets” approach, very valuable input passed on to us from our friends at Montreal Start Up.

Dealflow Report

Here is a sample of the publicly announced transactions that our team worked in the past few months:

Events and Calendars

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