For Canada’s indigenous people, entrepreneurship is already woven into the social fabric of the community, but support, resources and funding to foster that spirit still have a long way to go.
“A lot of the job programs that are created today are ones that often contribute – not intentionally – to the ongoing colonialism process,” says Duncan Kennedy, managing director of indigenous entrepreneur-focused accelerator Indigenext. He points to the example of a community learning program for an area where a pipeline is being built.
“Great you’ve got a job for a couple years, but then you can’t stay in your territory, there’s only one pipeline that gets built,” he says. “(But) ecotourism in your territory is an amazing opportunity, shellfish is an interesting opportunity… you can stay and work in your territory.”
According to the Canadian Council for Aboriginal Business, there are 43,000 indigenous entrepreneurs in Canada amongst a population of 1.4 million. With only four in ten indigenous adults having graduated from high school, and unemployment amongst indigenous people hovering around 40 per cent, entrepreneurship presents a solid alternative to the job program route.
Kennedy, who grew up in Prince George, B.C. and is of mixed Scottish-Métis ancestry, believes “reconciliation through innovation” – the idea that giving entrepreneurial indigenous people access to mentorship, funding, and resources – can change their life, and ripple out to the community.
It’s a sentiment echoed by Sunshine Tenasco, an Anishinabe serial entrepreneur from Kitigan Zibi Anishinabeg, Que. Tenasco says she never really considered entrepreneurship an option before launching Quemeez, a baby moccasin company. She brought her concept to Dragon’s Den, where several of the show’s investors bought in.
“People from my own community didn’t think that it was doable and these millionaires did,” she says. Now she’s trying to bring that message to her community.
Tenasco has since launched Her Braids, a line of beaded pendants where a portion of proceeds go to clean drinking water for First Nations communities, as well as Pow Wow Pitch, a Dragon’s Den-like competition where indigenous entrepreneurs pitch their concepts at the largest pow wow in Ottawa for a chance to win mentorship and a $5,000 micro-loan.
“The ripple effect of one person succeeding will affect the entire community,” she says. “So even if it means you employ yourself, eventually you’re going to grow and you will give back.”
Not so straightforward
There are some unique hurdles faced by indigenous entrepreneurs. “If you need a loan and live on a First Nations community, there’s no collateral so banks have a harder time lending you money,” says Tenasco.
According to a report commissioned by The National Aboriginal Capital Corporations Association (NACCA) and the Business Development Bank of Canada (BDC), the number of Aboriginal Financial Institutions has grown to 50 across Canada. The BDC has been one of the most sturdy links for indigenous people looking to fund business endeavours. Its Indigenous Entrepreneur Loan offers $250,000 for existing businesses and up to $150,000 for start-ups, regardless of whether their operations are on or off reserve, and refunds a portion of the interest paid to a registered charity of the entrepreneur’s choice.
As of March 2018, the BDC has committed more than $300 million across 550 indigenous clients throughout Canada. And it’s continuing to grow, says Monica James, Manager of Indigenous Banking (Eastern Division) at BDC, especially when contrasted with the portfolio in 2013.
“The indigenous population is growing at a rate faster than any other rate in Canada,” she says. “And we suspect indigenous entrepreneurship is growing at a faster rate than our non-indigenous population.”
But Kennedy says it isn’t necessarily money that is the actual problem, it’s the type of money.
He points to the CAPE Fund, a $50 million private-sector investment fund focused on “mid-market opportunities with a strong degree of Aboriginal involvement and connection to Aboriginal communities throughout Canada.”
It’s really one of the only funds focused specifically on indigenous entrepreneurs. Kennedy suspects access to “risk capital” – venture funding from private equity – in the traditional startup environment where entrepreneurs try to “exit” their company by strategically selling it, is at odds with the indigenous approach.
“We’re thinking about things from a 360 point of view… about the benefits to the community,” he says. “It’s a foundational problem if you believe the exit problem isn’t the goal (and) that’s a bit of a rethink.”
The key is to find investors interested in social entrepreneurship and impact investing, a concept less prevalent in Canada than it is south of the border.
Jonathan Araujo and Jacob Taylor, the serial entrepreneurs behind The Pontiac Group, a 100 per cent Anishinaabe-owned firm that brings First Nations and businesses together to build sustainable economic activity, see an indigenous-focused angels network of accredited investors as a viable solution.
Araujo points to the Northern Ontario Angels Network, a group of accredited investors who understand the unique challenges of living in some of the more remote regions of the promise.
“We need to have something very similar for our indigenous entrepreneurs where they can access an angel network,” he says. “(A group that) understands what it is to be an indigenous person and to do business in an indigenous community… because we don’t see the bottom line as being the key objective or goal.”
Araujo and Taylor are in the process of working with the City of Toronto to develop the Indigenous Centre for Innovation and Entrepreneurship, a 15,000 square-foot commercial space to collectivize resources and support for indigenous entrepreneurs. Like Indigenext, it’s a physical representation of a piquing interest amongst young indigenous people to start their own businesses and support their community.
In addition to its location, the Pontiac Group plans to create a digital resource that will give entrepreneurs, working remotely, access to startup tools like corporate lawyers and mentorship.
But it comes back to what Tenasco said about not knowing the resources available, a sentiment also echoed in the NACCA’s report on Aboriginal financial Institutes. That’s the biggest barricade, says Taylor.