What’s behind Toronto's banner year of success and its hugely lucrative final quarter? We took a closer look at why this city has been "feeling the love."
As we’ve recently covered, Toronto has evolved into one of the world’s premier tech hubs with a growth rate unmatched by any other city in North America.
So, which innovative companies are powering that boom? Here are seven of Toronto’s top startups to watch.
When it comes to upending the health benefits market in a short time, this startup – founded by serial entrepreneur and Kobo Founder Michael Serbinis – is truly in a league of its own.
League promises to drastically improve the health benefits experience for companies and employees alike, providing flexible, customized plans that allow employees – and they’re specifically focused on millennials – to allot coverage to suit their needs. Since launching in 2014, they already have hundreds of corporate clients in North America, including Facebook, Shopify, and Unilever Canada. They’ve also won over investors – including a $62 million funding round in July 2018.
“Employers experiencing the war for talent, skyrocketing healthcare costs, and the mental health epidemic are rapidly recognizing that a new approach to benefits will give them a competitive advantage,” said Serbinis. “Health benefits represent a tremendous opportunity to improve the lives and health outcomes for employees, but they’re not currently driving the business value employers should expect from their investment.”
Since launching in Toronto in 2014, Ritual has indeed become part of the daily routine for hungry office workers around the world.
The app allows coworkers to smoothly coordinate restaurant orders for pick-up while bypassing lines. Ritual expanded the business to Chicago and Boston in 2017 and by the end of 2019 will operate in 40 cities, including London and Sydney, and also plans to triple its restaurant count. It helps, perhaps, that the company’s fee structure (which it doesn’t disclose publicly) is said to be much more vendor-friendly than delivery apps. The startup raised $70 million in funding in June 2018 – at a valuation of $300 million – that will be used toward continued expansion.
“We are proud of the progress we have made in such a short period of time,” said co-founder and CEO Ray Reddy. “Because of our solid business fundamentals, we’re now positioned to rapidly scale our business and move into many more markets this year. We are excited to become a truly global brand.”
It used to be that smartphones were the enemies of teachers and professors everywhere – until Top Hat turned that idea on its head.
Top Hat is a platform that allows educators to take attendance, administer polls, and share lecture notes through students’ mobile devices, while also delivering online homework and interactive content. Founded in 2009 by Mike Silagadze and Mohsen Shahini in a small apartment near the University of Waterloo, Top Hat is now used at 75 percent of the leading 1,000 colleges and universities in North America, reaching millions of students.
Named the top Canadian startup at the 2017 TechVibes Canadian Startup Awards, Top Hat also takes care of its employees: perks and benefits include full medical, health and lifestyle benefits, free lunch, breakfast and snacks, employee stock options, and opportunities for career advancement.
To reach 750 post-secondary institutions in only a decade would seem quite the accomplishment, but Silagadze isn’t satisfied.
“I’ve actually been bummed out it hasn’t happened faster,” he said. “It’s so much better. It’s just so much better. Top Hat is cheaper and more interactive than anything else. Why isn’t everyone using this yet? We’re growing quickly but I feel like we should be in every classroom by this point.”
With a mission to reach millennials by simplifying the world of finance – “investing on autopilot” is the company’s catchy promise – Wealthsimple has already made a lot of people a lot of money.
The startup brings clients investments without high fees or account minimums often associated with big banks, along with other services – automatic rebalancing, dividend reinvestment, and tax loss harvesting – that were largely reserved for the wealthy. Less than five years after being founded in Toronto by Michael Katchen, Wealthsimple now has 150,000 users and manages $4 billion in assets. The startup also won back-to-back Webby awards for the world’s best financial services website, and it was also included in the Globe and Mail’s roundup of the top 10 best places to work in Canada.
Investors are believers in the company too; a $100 million funding round in May brought total funding to $266.9 million.
“Our vision is to build a crazy, successful, huge company, and really change the lives of millions of people,” Katchen said in announcing the funding. “I see it as an innovation fund – to make more and better products, to do what we do better and more efficiently, to bring powerful financial products to people who’ve never had them before.”
The days of cutting coupons from flyers are over for most shoppers, but everyone still wants to save money – enter Flipp. Now the No. 1 provider of digital circulars in North America with 50 million-plus downloads, Flipp uses a proprietary platform to transform print circulars into an interactive experience.
Certainly, Flipp’s client roster is impressive – the startup says it works with 90 percent of the largest retailers in North America, including Walmart, Ikea, and Home Depot.
Another startup singled out by the Globe’s best places to work in Canada roundup, Flipp offers extensive perks – and in fact, the startup’s leadership views those benefits as a crucial part of its culture.
“We take a people-first approach to our benefits and perks, which means we look at what’s important to our specific teams based on their life-stage, priorities, and preferences,” said David Au-Yeung, Flipp’s Co-Founder and Chief People Officer. “We want our team members to enjoy all aspects of their life.
“What’s most important is the freedom and responsibility that we give our team members. That means unlimited vacation (minimum three weeks), the option to work from home, and flex hours. We also promote a healthy lifestyle with a complimentary Goodlife membership as an example. Our team members enjoy family-style Friday lunches, a leading benefits package, including a competitive parental leave top-up, complimentary transportation, whether it’s TTC passes or parking, and much more.”
When Nicholas Reichenbach was leaving Burning Man a few years ago, he looked with dismay at the mountain of plastic water bottles being hauled out at the end of the festival and an idea came to him: Couldn’t something more sustainable be produced? From that observation came Flow, which packs its alkaline spring water in a 68 percent renewable and 100 percent recyclable paperboard pack (it also helps that Reichenbach’s family has owned an artesian spring in South Bruce County, Ont., for five generations).
Clearly, he was onto something. As of the end of 2018, Flow was sold in 15,000 locations across North America and the startup expected to sell 100 million packs by 2020. Flow also has powerful celebrity allies in Gwyneth Paltrow and Shawn Mendes and remains committed to its environmentally responsible roots – in fact, the startup’s goal is to produce a 100 percent sustainable pack by 2024.
“When I asked my dad for permission, he told me that I could develop the spring on the basis of two things: one, you never take more than what is given to you and two, that you never build a factory on top of the spring,” Reichenbach said. “His grandfather kept it that way. His father kept it that way, and I will keep it that way. We have to be sustainable.”
A mobile app that helps retail workers to look up products, manage customer information, and check out shoppers, Tulip is suddenly a fixture at stores around the world.
The app – which ultimately aims to elevate the shopping experience, boost sales, and improve customer service – is now used by six of the top 10 luxury brands in North America and counts clients including Chanel, De Beers Jewelers, Coach, Saks Fifth Avenue, Kate Spade, and Michael Kors.
The startup is special for another reason. Tulip’s CEO and founder, Ali Asaria, announced at a company Christmas party that he was going to donate, through a binding pledge, 80 percent of his shares in his firm to a charitable trust controlled by employees – so if the startup gets sold or goes public, 80 percent of those proceeds would go to charity.
“We’re really passionate about using this as a story of why you should join Tulip,” Asaria said. “I think it will be interesting for us to be able to tell new candidates, ‘Hey you can go and work for a traditional startup and make the Founder very wealthy. Or you can work at Tulip, and we can jointly try to build a multibillion-dollar charity that could transform the world, and we’ll all have a piece in that.’
“I think that means a lot, especially to a next-generation worker who is looking for more in their job than salary and perks.”