Tech is Back

TSX & TSXV Technology and Innovation Sector

By the Numbers

From 2009 to year-end 2015:

  • 178 IPOs and New Listings
  • $34 billion raised
  • $128 billion increase in market value

Canada's Technology and Innovation Sector—which includes Technology, Clean Technology and Life Sciences—is surging and this is highlighted by the impressive growth of these companies on Canada's leading public markets: Toronto Stock Exchange (TSX) and TSX Venture Exchange (TSXV).

Consider the numbers: Since 2009 to year-end 2015, 178 Initial Public Offerings (IPOs) and new listings; $34 billion raised; and a $128 billion increase in market value.

TSX and TSXV support this rapid growth, which spells potential opportunities for technology and innovation companies, and investors who are interested in this thriving sector.

For Technology and Innovation Companies: A public listing offers access to new sources of funding, improved liquidity, an enhanced profile with customers and employees, and a currency for acquisitions, among other benefits.

From the beginning of 2014 to year-end 2015, 69 new technology and innovation companies have gone public on TSX and TSXV. This constitutes more than any other industry sector. These technology and innovation companies have raised over $17 billion in equity capital on TSX and TSXV since the start of 2014.

In addition, TSXV has continued to be an effective incubator for smaller companies. From the beginning of 2014 to year-end 2015, 13 technology and innovation companies graduated from TSXV to TSX—the highest graduation rate across all sectors.

For Investors: There are currently over 420 technology and innovation companies listed on TSX and TSXV, offering the opportunity for diversification and to participate in numerous fast-growing businesses—many with global operations.

Notably, several companies have been aggressively growing via acquisition. This underscores the fact that some of Canada's largest technology companies are becoming world-scale players in their sectors.

For example, technology solutions provider DH Corporation (TSX: DH) recently made a significant U.S. acquisition. In April 2015, DH completed the US$1.25 billion acquisition of Fundtech, a provider of global payments solutions to banks worldwide.

In 2015, 29 new technology and innovation companies chose to go public and list on our exchanges including:

  • Shopify Inc. (TSX: SH), which provides cloud-based, multi-channel commerce platform designed for small and medium-sized businesses. The company's platform provides merchants with a single view of their business and customers across all of their sales channels.
  • Stingray Digital Group Inc. (TSX: RAY.A), a business-to-business multi-platform music and in-store media solutions provider. Its products include digital music & video services like Stingray Music, Stingray Concerts, Stingray Music Videos and Stingray Lite TV.
  • Mogo Finance (TSX: GO), a full credit spectrum lender of consumer loans and prepaid credit cards to consumers across Canada. The company delivers its products through their online lending platform and nine branches located in cities across Canada.
  • Frankly Inc. (TSXV: TLK) is engaged in developing and servicing instant messaging and social network applications for consumers and instant messaging software development kit for business partners.

Tech Sector on Political Radar

The Government of Canada sees growth in the technology and innovation sector as an important driver of future economic development. Our exchanges support this view.

Attending the World Economic Forum in Davos, Switzerland in January 2016, Prime Minister Justin Trudeau talked about leveraging competitive advantages and positioned Canada as "an engine of innovation". More specifically, he declared that Canada has excellent universities and a strong high-tech sector. Canada is poised to play an important leadership role in the upcoming "fourth industrial revolution", the fusing of technologies at an unprecedented speed, scale and scope, Mr. Trudeau said.