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5Q: Serial entrepreneur Chris Carder on the store of the future (and starting up in Canada)

Kinetic

Forget Silicon Valley and Menlo Park, Chris Carder sees a startup renaissance happening in our own backyard.

“I think Canada is an amazing place to have a startup and being here in Toronto specifically, I think there’s so many assets and opportunities to work with like our young emerging creative and technology class workforce,” says the co-founder of design and technology lab Kinetic Café and Entrepreneur-In-Residence at York University’s Schulich School of Business. “It rivals anything that’s available in the world.”

It’s that creative talent pool Carder and Kinetic co-founders Gary Fung and David Dougherty draw from, using their team of 50 designers, innovators and serial entrepreneurs to incubate ideas and build out tech, mobile and marketing solutions for startups and big businesses like Pizza Hut, Aldo and Flight Network.

Take Wirkn for example, a mobile app platform for job hunters that was initially dreamt up by Aldo group VP François Jobin before he brought it to Kinetic. The team incubated the idea in-house and then spun it out as a new business.

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Then there’s “the store of the future”, another exercise in hyper-connectivity and technology for the shoe brand, which included physically building a state of the art mock-up of the shop in the Kinetic offices.

“It creates an opportunity for the designers, developers and product people to really be in the mind space of what they’re creating as opposed to creating it in theory on screens,” adds Carder. “Prospective clients can come and play in those environments and check them out and other startups will be able to come in and plug in their own technologies and hardware into our platform and see how they will fit in.”

Both are prime examples of Kinetic’s not-quite-a-venture-capital-firm but not-quite-an-incubator model.

We sat down with the serial entrepreneur to chat about the future of retail, why Canada is better than Hong Kong when it comes to launching a business and what the Canada’s startup ecosystem is missing.

On paper Kinetic Café really sounds a lot like an incubator but I know you’re not fond of using the term to describe it.

Really it's about taking on those big challenges and opportunities for those leaders of businesses. Whether it’s a giant international retailer looking to transform what it sees as the store of the future to a brand new company being started by two executives with a dream or vision for something, we wind up at the table with them helping them figure out how to craft that vision for their product, for their service.

So with Aldo then, that was designing your so-called “store of the future” and figuring out how to add augmented reality and other mobile aspects to the shopping experience in a non-cheesy way?

A lot of it will be revealed in time when we launch at the new World Trade Center building – the Freedom Tower – in New York City this year. But fundamentally, the mission we were tasked with was how would you take the store and create an opportunity so that when somebody walks in that store with his or her phone it is not just: “hey, there's a few neat deals on my phone because I happen to be standing in the store.” We want to transform the entire experience of that person – from the second you’re approaching that store to the second that you leave.

Which is partially done through things like a mirror/high-resolution screen that gives personalized fashion advice and visual cues to shoppers. What else are you working on?

We've also developed a platform that we refer to as Kinetic Commerce, it’s not branded yet but it will allow us to set up and transform all sorts of connected experiences and environments in everything from retail to larger mall locations to stadiums to public spaces to museums to schools. It’s a fun space to be in and a fun time and this is the only the very beginning of that era of connected devices and connected spaces. Retail is obviously a huge leading-edge space and opportunity to explore connectivity.

Is there another place in the world where this sort of innovation is taking place? I’d suspect somewhere like Denmark of Sweden.

We haven’t modeled Kinetic Café after a particular company out there in the world. There are a lot of creative agencies or technology groups trying to do parts and pieces of this. I’m not foolish enough to think we're the only people doing it this way but I think we're one of the few organizations that really has this approach as our long-term committed way of tackling the marketplace.

But startup culture in general, I mean, the Bloomberg Rankings put Canada in second place behind Hong Kong as the best spot to start a business in the world. How do you feel about that?

I disagree (with Bloomberg) – I think we should still be number one. All you have to do is walk up and down the streets on any given day in Toronto and you'll see a never-ending stream of opportunities to be out in the startup community and be engaged and find partnerships and meet experienced executives and leaders and entrepreneurs who want to give back and teach – it’s ongoing, it’s non-stop. And you might go to other places in the world and there might be a couple of events on that month, here there’s a crackling, vibrant community.

And yet I still hear from tech startups all the time that you have to go to Silicon Valley to be taken seriously.

I don’t think you have to so. I think there are two paths and two opportunities. I’m not going to say anything bad about somebody who takes that path of going to Silicon Valley – that’s amazing, go for it. But it’s a different set of assets and a different set of opportunities there. At the same time you don’t have to be nervous about being here but taking a big glorious run at the market south of the border at the same time. Those opportunities still exist.

Well you’ve been through it before Kinetic, launching your email marketing services ThinData in 1995 and growing the startup until you sold it to Transcontinental in 2008. From your experience, what’s the Canadian startup ecosystem missing?

People are going to tell you that there is a need for capital but that’s not anything revolutionary. If you rewind to 1995 when my first partner and I were building ThinData, ask us where the heck we went to get capital. There was nowhere to go. I literally had to go and storm the Royal Bank Tower. I needed a $100,000 line of credit so I went in and rode the elevator for four hours and every time that someone got on the elevator with white hair and a pinstriped suit I would explain my business to them. At the end of those four hours I had my $100,000. But that was it man! So now I look what's here in terms of the opportunity to access capital and it may not be Silicon Valley but we do need to acknowledge that we've come a long way. Could we use a more aggressive mindset in terms of the investment community and in terms of what people are getting behind? Sure. Could we use layers of capital that are not just reserved for pursuing homerun, billion dollar exits but that could be accessed by entrepreneurs who want to create long-term sustainable businesses that create jobs for the next thirty years? Yes. We're sorely missing anyone interested in that kind of stratus of things. But it's a heck of a lot better than it ever was.

So what's next then?

I think the next thing for the startup community is to really continue to work on building the bonds of connectivity closer and closer. To try and get behind each other even more, to support each other and build the overall community because even though there’s a ton of unique individualized opportunities out there right now, there’s an awful lot of competitive nature between all the groups and everybody kind of scrambles on top of each other to be the shiniest, coolest, most government-funded group on the block. But it’s getting better. I think you’re already starting to see that with the city bringing together the different incubators and accelerators to talk joint missions and collaboration.

A collective vision of sorts.

Wouldn't it be an interesting possibility that just like when the banking system started to falter in other places in the world and people looked to the Canadian system, if in a couple years from now, people looked at our startup ecosystem and said man, “maybe, there’s a lot of big billion dollar exits that happen in Silicon Valley but no country has nailed job creation out of the startup community like we've seen out of Canada.” Maybe we can do that and have that and own that and that could be the legacy of the people who were shepherding and stewarding the startup community in Canada at this period of time.