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Okanagan tech sector grows to a $1.3 billion economic impact

A report released this week shows an overall $1.3 billion impact for the tech sector in the Okanagan.
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Raghwa Gopal

A report released this week shows an overall $1.3 billion impact for the tech sector in the Okanagan.

That $1.3 billion represents an increase of over $300 million of revenue contribution to the Okanagan economy since 2013, a 30 per cent growth rate over two years.

At a press conference held on Wednesday in Penticton, Accelerate Okanagan CEO Raghway Gopal said the organization might soon bring an technology incubator back to the city.

Penticton was once home to the Okanagan Research and Innovation Centre, but after it merged with with AO in 2012, its presecence was gradually reduced and the physical location was elminated.

“For any technology driven business, we provide mentorship and community and programs. If there is any company within this region that has a business that is tech driven we are open to helping them,” said Gopal, adding that they still provide services to the South Okanagan tech sector, either through visiting representatives or companies visiting the incubator in Kelowna.

“But our plan is to actually have a physical location here and Peter (Haubrich) and I have been in communication  to try and get something here as soon as we can,” said Gopal.

Mayor Andrew Jakubeit said growing the technology sector in Penticton is one leg of the city’s four-pillar strategy to expand the local economy. He singled out Windward Software as an example; the company was started and is still headquartered here, but has grown to a worldwide corporation. It still employs many people in Penticton and is involved in the community through Rotary and other projects.

One of the city’s goals, according to Jakubeit, is to develop a stronger relationship with Accelerate Okanagan (AO), helping them foster relationships and mentor tech companies.

“What we want to see is tech companies grow from being Ma and Pa, two person in the garage, to larger companies that are employing many people,” said Jakubeit.

Gopal said developing that relationship is a goal for AO as well. The organization receives 55 per cent of their funding from the province, he said, with the remaining 45 per cent coming from partnerships and programs.

“It is not the financial impact, it is having the support of the City of Penticton when we go out to get our funding from the government to be able to provide these kind of programs. We have had great support from Penticton all the way to Salmon Arm,” said Gopal, adding that AO is hoping to develop a financial partnership with Penticton in the future.

The conference also featured testimonials from two South Okanagan entrepreneurs: James Rosowsky, former CEO of Karoleena Homes and Scott McMillan, CEO of XCO.

Rosowsky said he moved to the South Okanagan for the lifestyle, then developed his company to the point it was employing 40 people before he sold it.

“Since 2013 my partners and I were involved in a number of Accelerate Okanagan programs that ultimately contributed to our success,” said Rosowsky. “During that time I have seen the community grow and continue to mature and have been very fortunate to be part of it.”

McMillan, a former Nike employee, came to the Okanagan to be part of the triathlete community, both as a competitor and a trainer. His focus now with XCO is developing a sophisticated system for tracking athlete movement and performance.

It’s already attracted attention from a Canadian Olympic skating team, and an elite training facility in the U.S.

“We have had interest from drone companies that want the drone to automatically follow where the athlete is going, so they are constantly videotaping them,” said McMillan. “You can imagine that can go to other activities as well.”

With these innovations comes jobs, as technology continues to develop in a number of sectors: agriculture, energy, healthcare, software, telecommunications and advanced manufacturing.

According to the report, 7,600 people are employed by the Okanagan technology sector, showing a 16 per cent growth rate since 2013.

Jakubeit said Penticton is targeting the tech workforce and tech companies that are looking for a more relaxed lifestyle.

“They want to get out of the hustle and bustle of the bigger cities and you could argue that Kelowna is a big city and has some of the same hustle and bustle the you are trying to escape,” said Jakubeit.

“That is starting to resonate with people who want that more relaxed lifestyle and with 52 per cent  of the workforce being under 35, for some they want a nice place to raise their family.”

A key factor in promoting Penticton as a tech hub, according to Jakubeit, is the announcement this week from Telus that Penticton will be getting hooked into their fibre network next year, allowing the possibility of high-speed internet connections matching larger urban centres.

“That is really the missing link for allowing businesses to compete on a global scale,” said Jakubeit. “When people are considering to come to the Okanagan, that it is not just Kelowna. You can go to Penticton, you can go to Vernon, it is the region we are trying to build to be a tech giant.”