Laying Down the Roots of Innovation

It takes money to bring scientific start-ups to the big time, usually from a combination of government funds and venture capital.

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Venture capitalists are known for financing high-risk early-stage companies and running with them, investing cash in exchange for an ownership stake in the company.

But start-ups are risky, and the hope is that at least a few of the pitches they fund will take off. To be considered at all, a company already needs to have significant development behind it.

“When we come to invest, somebody has done some research and built some technology already, and in an ideal case, they already have a working prototype,” says John Ruffolo, Chief Executive Officer of OMERS Ventures.

In other words, the product or service has already been built, and venture capital gives it a boost to help it grow faster and find a customer base.

To get to this stage at all, a lot of investment has already gone into development. This is a role that has to be filled by the government, says Ruffolo.

He likens it to tending a farmer’s field: the government’s job is to pull out the weeds, decide which seeds should be planted, and spread out some fertilizer to get the seedlings started.

Venture capital only comes in to provide a bit more water and sunshine to help them grow a bit faster so that the fruits can get to the market.

“We cannot make any investments until the farmer has plowed the field,” explains Ruffolo. “That’s the research. And this is just like infrastructure of a nation, and why the government is really the only source of capital that can properly fund it and really bet for the long term.”

Sometimes these long-term investments take decades to come to fruition, but when they do, it’s this initial backing that makes sure the trees have rooted in our own backyard.

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John Ruffolo is the Chief Executive Officer of OMERS Ventures, the venture arm of OMERS, one of Canada’s leading pension funds. OMERS Ventures is a multi-stage investor in growth-oriented, disruptive technology companies.

In addition, he is also the Executive Managing Director with OMERS Platform Investments, the innovation investing arm of OMERS.

He is also the Vice-Chair of the David Suzuki Foundation and is a board member of the Royal Ontario Museum, Caldwell Partners “Top 40 Under 40” and League of Innovators. In addition John is a Dean’s Advisory Council Member to the Schulich Business School as well a member of the Toronto chapter of the Young Presidents’ Organization (YPO).

Prior to joining OMERS, Ruffolo was a Partner at Deloitte, as well as the Global Thought Leader, the Global Tax Leader and the Canadian Industry Leader for Deloitte’s Technology, Media and Telecommunications (TMT) practice. He was also a member of the firm’s Tax and TMT Global Leadership teams and a member of Deloitte’s Board of Directors.

A chartered accountant, Ruffolo was formerly a partner with Arthur Andersen LLP and has also spent time as an instructor for both the Canadian Institute of Chartered Accountants and York University’s Schulich School of Business, from which he holds a Bachelor of Business Administration.

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