BRUCE CROXON’S PREDICTIONS FOR THE CANADIAN TECH COMMUNITY IN 2018
Just three weeks in, 2018 has already proven to be an eventful year for the Canadian technology community. Since the beginning of January we’ve seen acquisitions, significant leadership moves and massive funding rounds, and we shouldn’t expect the excitement to wind down anytime soon.
Some technologies and events that will continue to drive innovation and conversation this year include cryptocurrencies and the blockchain, the country’s upcoming legalization of recreational marijuana, and the Liberal’s proposed small business tax reform. While we’ll only fully understand the impact these things have on the tech community as the year goes on, I’ve laid out some predictions below.
There will be an adjustment in the price of most cryptocurrencies, but the blockchain will further secure its potential for decentralized transactions
There has been a lot of talk recently about the volatility of cryptocurrencies. The unprecedented growth of cryptoassets in 2017 has left people skeptical, and many financial advisors have taken to the media to urge both their clients and the public against such volatile investments. 2018 will see cryptocurrencies continue to grow, but they will also swing wildly in value.
As cryptocurrencies grow, the blockchain will secure its status as the technology for decentralized transactions, and it will begin to disrupt industries and address real-world challenges such as payments, security, identity, and ownership management.
Not as many people will switch their marijuana buying habits to legitimate paths, as some of the stock prices seem to be betting on
Many Canadians are looking forward to summer 2018, when the nation will officially legalize the production, sale, and consumption of recreational marijuana. Last summer, cannabis stocks soared as investors anticipated the profits associated with a legalized distribution system, but by the end of the year stock prices had taken a turn for the worse as uncertainty about the demand for legal marijuana grew. This downward spiral will continue if regulated sales prices are higher than what consumers are currently paying — and that’s what we’re expecting.
Machine learning will continue to influence critical industries like manufacturing, automobiles and security
Machine learning and artificially intelligent technologies are already influencing many industries and verticals. These technologies will continue to improve and will be further adopted in 2018, with low-hanging fruit opportunities in the legal and financial verticals.
I also believe that increased concern will be voiced about the social dislocation and economic upheaval experienced by increasing numbers of people left unemployed or underemployed. Amazon just opened its first cashier-less store, and driverless cars are already here. Many of these new applications will have an enormous negative impact on the people and families affected.
The Liberal government will not end up shooting early-stage risk capital in the foot by implementing the unfair tax changes contemplated in the summer
In August 2017, the Liberal government announced their proposed business tax reform. The announcement was met with an onslaught of criticism from the Canadian small business and startup communities, and the debate continues to this day.
The tax reform, if realized, would severely curtail early stage technology investment, compromising the supportive entrepreneurial culture that Canada has worked so hard to build. But I don’t foresee the changes being made as is.
The government will realize that making it tougher on small business entrepreneurs is not in the best interest of the country, particularly in consideration of moves being made by our neighbour to the south. This will be the year that the Liberal government finally wakes up to partnering with the small business and investment community rather than waging a misguided class warfare. There is too much at stake for all Canadians for reason not to prevail.
Canada will enjoy another stellar year in technology investments, mergers and exits
While this prediction may sound like a given, our tech community has seen many a lackluster year and Canada has not yet had its day in the sun.
2018 will see Canada standing tall, with much wealth generated, and its ranking in the world of technology will continue to grow. In many ways, government intervention aside, the stars are aligned. We have several successful second and third time entrepreneurs giving back, capital is flowing, and we have the best engineering talent in the world. This is our time.