Canada Needs More Entrepreneurs and Self-Confidence!

On the global stage, Canadians are known for being peacemakers, polite and humble. “The world needs more Canada” Obama said, what more could we ask for? There’s no better complement and that should feed our belief in ourselves, however we continue to come up short on, confidence, which has a greater impact. When a person lacks self-confidence, the impact can be significant, restricting their ability to be all they can be, and as a ripple effect, this could impede our economy by preventing entrepreneurship. Our uncertain behaviour is known to permeate corporate boardrooms, American business leaders have described Canadian colleagues as “hard-to-read”, “risk resistant” and “hesitant decision-makers”, possible we’re playing a good boardroom game but unlikely. For Canada’s economic future to be a success, we need more entrepreneurs, they are critical, and we should be molding an environment where this is nurtured. It would serve us well to shed our insecurities, cultivate accessible creative thinking education and training, provide better access to capital by way of our financial institutions and leverage government policies that encourage people to risk-take without fear.

To be an entrepreneur, you have capacity for risk-taking which demands a healthy level of self-confidence, after all, if you don’t believe in your company, who will!? Entrepreneurs are risk-takers and are needed to build a growing, competitive, economic landscape however, Canada is at a low point of cultivating them. They possess the personality characteristics that fly-in-the-face of our boardroom reputation and should be celebrated as Canada’s economic heroes. Our economic growth is facing a serious challenge due to the alarming fall in entrepreneurial activity in recent years. This drop in the participation rate of entrepreneurs is raising concerns about the long-term viability of the economy. There are several consequences, including a decline in creativity, a delay in the development of jobs, and a decrease in competitiveness internationally. Without a consistent stream of new enterprises and startups, Canada faces the risk of decreased development and lost prospects for expansion. There is an opportunity to nurture a culture of entrepreneurship through education and support systems, such as a banking system that could foster a better climate for prosperity.

Why Does it Matter?

1.  Economic Growth

Encouraging entrepreneurship is important for promoting sustained economic growth in Canada. According to Statistics, small businesses account for over 36.7% of all businesses in the country, contributing significantly to job creation and GDP growth. Research by the ISED indicates that small and medium-sized enterprises (SMEs) are responsible for employing nearly 74.8% of the private sector workforce.

2.  Innovation

Entrepreneurs are natural innovators, finding new ways to solve problems, meet needs, and create value, this drives progress and shapes industries. They are often the foundation of technological advancements, presenting new solutions that revolutionize entire sectors. From groundbreaking startups to established enterprises, Canadian entrepreneurs are pushing the boundaries of innovation across multiple fields, including technology, healthcare, sustainability, and more.

3.  Job Creation

Encouraging entrepreneurship plays an important role in job creation. When people start their own businesses, they often hire others to help them. This creates more job opportunities for everyone. Small businesses are known for creating a significant number of jobs across various sectors. New jobs can help reduce unemployment rates and provide individuals with valuable work experience and income. Additionally, small businesses tend to be more flexible and responsive to changing market demands, making them important contributors to the labour market.

4.  Diversification

Diversification means having different kinds of businesses and jobs instead of relying on just one or two things. When a country's economy is diverse, there are fewer chances to be hurt by problems in one industry. We need more entrepreneurs to start businesses in various fields, like technology, healthcare, agriculture, and more. Having a wide range of strong industries, we are de-risked of geopolitical shifts and are better prepared for economic changes.

What are the barriers?

1.  Economic Uncertainty

One of the primary reasons for the decline in entrepreneurial participation is economic uncertainty. Uncertain economic conditions, such as fluctuations in interest rates, currency values, and job market volatility, creates fear which prevents people from taking risks.

2.  Access to Funding

Sourcing capital to start a business can be quickly defeating, particularly in a country where risk-aversion is part of the social fabric. While there are various sources of funding available, including government grants, loans, venture capital, and angel investors, securing financing can be challenging, particularly for early-stage startups and small businesses. High levels of debt, strict lending criteria, and risk resistance among leading financial institutions can make it difficult for entrepreneurs to access the capital needed to launch and grow their startups.

3.  Regulatory Burden

Complex regulations, bureaucratic hurdles, and compliance costs are a hurdle to overcome and discourages individuals from getting into entrepreneurship. The World Bank's Ease of Doing Business Index ranks Canada 23rd out of 190 economies, highlighting the chances for improvement in streamlining regulatory processes and reducing administrative burdens for entrepreneurs.

4.  Skills and Training Gaps

To be an entrepreneur typically requires an individual to possess a wide range of skills, including business awareness, leadership, innovation, and resilience. Many entrepreneurs may lack the necessary skills and training to succeed in the competitive business environment. Limited access or barrier to education, mentorship programs, and support networks prevents individuals from pursuing entrepreneurial opportunities and realizing their full potential.

5.  Demographic & Cultural Factors

Older individuals may be less inclined to take the risks associated with entrepreneurship, while younger generations face mounting student debt, housing affordability challenges, and uncertain job prospects, which can be a reason for the falling participation of entrepreneurs in Canada.

Along with demographics are cultural attitudes, societal norms and perceptions can favour traditional career paths over entrepreneurship, leading individuals to pursue stable employment rather than taking risks in starting their own businesses. Changing these attitudes and building a culture of entrepreneurship requires some effort from educators, and business leaders.

Embracing Risk Taking

Canada needs more entrepreneurs, now! With economic challenges and big problems to solve, we need people with fresh ideas and the courage to try new things. By helping entrepreneurs with collective support, money, and education, we can make it easier for them to succeed.

Canadians also need a desperate injection of self-confidence; it is woven into our DNA to have a persona of inadequacy next to our Goliath neighbour to the south. In 2008, our risk resistant behaviour served us well, Canada largely avoided the financial crisis because our banks were so prudent, and we should be enormously grateful for that. That measured cautious mindset can live with confidence, it would be the perfect blended for success as it prevents hubris, Canadian with a topping of American sprinkles. 

By building an environment and culture conducive to entrepreneurship, Canada can create the potential for innovative startups and small businesses to drive forward its economic development agenda, creating a more prosperous future for all. We need that to be a global competitor and it should be embrace by education, policymakers, and financial institutions.