2021 study shows growth in Alberta's technology sector
Alberta Enterprise Corporation’s (AEC) 2021 Deal Flow Study revealed that Alberta is now home to more than 3,000 technology companies, a 233 per cent increase since 2012. The majority (58 per cent) are located in Calgary, with 30 per cent in Edmonton and almost 13 per cent in other regions of the province.
The survey results suggest that Alberta’s technology sector is becoming more mature and established, with almost 40 per cent of the startups surveyed in the 2021 Deal Flow Study reporting greater than $1M in annual revenue (a 66 per cent increase over 2018).
"It's great to see more than double the number of companies identified in the 2021 Study. Alberta's tech sector is maturing rapidly and it is now a real driver of employment and diversification. We don't just want to be a player in Canada's tech space — we want to become a dominant player going forward," commented Doug Schweitzer, Minister of Jobs, Economy, and Innovation.
One of the data points Alberta Enterprise was watching closely in the 2021 study was on the diversity of founders in Alberta. Two years ago, the report showed 30 per cent of tech companies in Alberta have a female founder or co-founder. The 2021 report showed almost the same proportion of female leadership suggesting inclusivity is one of the cultural advantages of Alberta.
Key study findings
In Alberta, in 2021 there are 3,083 tech companies, compared to the previous 1,238 identified in 2018. Most companies operate out of the two largest cities Calgary: 1,776 companies, Edmonton: 918 companies.
The study found that the average age of Alberta's startup founders is 43 and 68 per cent have previous startup experience. Almost 30 per cent of Alberta companies have female founders or co-founders and 35 per cent of the companies that achieved profitability in the last two years were female-founded.
The number of companies with 25 or more employees has increased by 12 percentage points up to 25 per cent, between 2018 and 2020.
67 per cent of Alberta companies are developing software, many for business-to-business enterprise applications. A significant proportion of companies are integrating digital technologies like artificial intelligence (AI) and machine learning (ML) (36 per cent) and big data (27 per cent) into their products and services. Companies surveyed had customers in the following industries: 34 per cent professional services, 23 per cent in other industrials, 15 per cent in energy and mining, 12 per cent in information and media, 8 per cent health, wellness, and medical, and 8 per cent in agriculture.
AEC commissioned this study to build upon the previous reports from 2012, 2016, and 2018. The studies provide invaluable insights on the participants, types of companies, funding, founder makeup, and more.
“By thoroughly tracking key data about our technology sector, we are able to see how to wisely support a sustainable technology industry in Alberta,” said Kristina Williams, CEO of Alberta Enterprise Corporation. “Looking at a decade of data, we can see the major growth impact that greater access to venture capital has had for our homegrown Alberta technology companies.”
IoT market expected to grow due to increase in IoT use cases
An increase in the internet of things use cases is expected to drive the IoT service market, according to the IoT Services Global Market Report 2021: COVID-10 Growth and Change to 2030.
IoT has found its use in many areas over the years. It can be used in manufacturing, farming, smart cities, transportation and in many other industries and fields.
Due to the fact it can be utilised in many industries, there is an increased need for IoT services and applications. IoT services that provide support by delivering services such as consulting, data management, network management and security services, are in much higher demand.
The impact of COVID-19 on the IoT services market
According to the report, the global IoT services market is expected to grow from $139.24 billion in 2020 to $162.39 billion in 2021 at a compound annual growth rate (CAGR) of 16.6%.
In the coming years, the IoT managed services market size is expected to reach $381.16 billion in 2025 at a CAGR of 24%.
This growth lends itself to companies resuming operations and adapting to the new normal as we emerge and recover from the pandemic.
Previously, COVID-19 restrictions led to restrictive containment measures, remote working and the closure of commercial activities that resulted in operational challenges.
IoT use cases driving growth
The IoT services market consists of the sales of IoT services and their related products. IoT services are delivered by the IoT services providers. These providers provide consulting, security and analytics services as per the requirements of the business.
Major players in the IoT services industry are Cisco Systems, Cognizant, Google, Infosys and Tieto Corporation, to name a few.
An increase in IoT use cases is expected to drive the IoT service market; this is where IoT can be used to automate processes and increase productivity. As it has found many uses cases over the years, this increases the demand for IoT services and this is expected to drive growth.
Enhancing deployment workloads with edge or cloud computing
Despite the expected growth, low enterprise adoption is expected to hinder the IoT services market. Although IoT has its use in many industries, due to factors such as low awareness, enterprise adoption is low, the report states.
Only 29% of enterprises have adopted IoT solutions according to the Omida data survey.
Edge or cloud computing however is enhancing the deployment workload on IoT devices, according to the report. This solution facilitates data processing and data storage in the cloud.
Microsoft released its Azure IoT Edge recently. This fully managed service is built on Azure IoT Hub. By moving certain workloads to the edge of the network, businesses that utilise Microsoft’s IoT platform spend less time communicating with the cloud, react more quickly to local changes and operate reliably in extended offline periods.
The IoT Services Global Market Report 2021: COVID-19 Growth and Change to 2030 is one of a series of new reports from The Business Research Company that provides an IoT services market overview