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In 2008, the University of Waterloo launched the Velocity Residence, a dorm for students who are interested in entrepreneurship and want to be immersed in its culture while working on business projects. The popularity of the program quickly outgrew capacity, and in successive years, Velocity expanded its programming to meet the evolving needs of entrepreneurs.
On October 28, 2016, Velocity celebrated the grand opening of the newly renovated Velocity Garage, expanding its facility to 37,000 square feet, to become the largest free incubator space in the world, offering workspace, support and mentoring to start-ups.
Velocity Start is a physical workspace and program that operates on campus at the University of Waterloo. It is geared to people in any field of study who are interested in learning more about entrepreneurship. The program offers workshops on topics ranging from starting a business, how and when to incorporate, problem ideation and panel discussions by successful entrepreneurs. Students also have access to start-up coaching and a makerspace with 3D printers and hand tools, for prototyping and to experiment with the technology. "We want to really engage at an early level with students from all areas of education and to expose as many people as possible to entrepreneurial thinking," said Jay Shah, Director of the Velocity Program.
More formal than the Velocity Start program, students who live in the Velocity Residence must apply for admission. 80 students are selected from a wide range of programs, and live on campus in the residence, where they can share ideas and perspectives, start working on projects, and receive insight from entrepreneurs through weekly guest speakers. "While there is a strong technical presence, we encourage students from other disciplines to apply because breadth of experience can foster better ideas and innovation. It's one of our guiding principles for the Velocity program," said Shah.
A unique partnership between the University of Waterloo and the Faculty of Science, the Velocity Science program is geared towards providing students interested in entrepreneurship in the science field with the mentorship, lab space, equipment, and community support to develop, test and launch start-ups. Students must apply, and then can opt to work at the Velocity Garage or on campus. "This is such an interesting partnership because it provides both the best of what academic and research infrastructure can offer, as well as the best of what the regional supports can offer. This level of innovation requires the research infrastructure that is only available in an academic setting," said Shah.
Early stage start-ups can compete in the Velocity Fund Finals, a pitch competition that is held three times a year, and awards $125,000 in grants to student-led start-ups. Twenty teams provide a 3-minute pitch demonstrating the problem, solution, market opportunity, traction, and team, and winners are admitted to the Velocity Garage to incubate their start-up.
Located within the Tannery in downtown Kitchener, the Velocity Garage provides a solid foundation for success. Since inception, over 100 companies have launched through the Velocity Garage, including Thalmic Labs, Vidyard, Kik and BufferBox. 67% of the companies are still operating five years after launch. Companies must apply for admission, and if accepted, they are slotted into one of three stages, depending on the life-stage of the company. Workspace, mentorship, and a vibrant start-up community are provided rent and equity-free to companies. The environment in the Velocity Garage encourages collaboration and shared experiences that benefit all participants.
Stage 1 companies are early-stage enterprises that are validating a market opportunity within the first 90 days of the program. Many companies do not proceed past this stage for a variety of reasons, such as a product that is already available in the market, or conversely, a product that the market may not be ready for.
Stage 2 companies do not have a time limit for participation, although they are reviewed regularly to ensure there is still progression and positive momentum. The goal for Stage 2 companies is to build a viable product, while continuing to talk to prospective customers. For health devices, for example, it may take several years for beta testing and regulatory approval. "The easiest part of a start-up is the very beginning, and it only gets harder from there. Once Stage 2 companies have reached a repeatable sales cycle with a verified process to get their products to market, they can move to Stage 3," said Shah.
"The advantage of a long Stage 2 allows companies to learn the importance of a strong team, and how to ride out the stresses that come with trying to launch a company. There can be a lot more lows than highs and the journey can be hard. The need for perseverance and resiliency keeps the best companies going in the tough times. A start-up may need to learn through a process of fail and reset, and our community supports the courage that takes," said Shah.
Stage 3 companies have a proven process for delivering their products to market. They may have reached a point where they need to hire sales staff, attract investors to scale the companies, and they may also have begun to outgrow the Velocity space. The needs of Stage 3 companies are more complex, and mentors and alumni of the program regularly provide insights as support as the participants grow and scale their operations.
"The growth of Velocity in downtown Kitchener demonstrates additional confidence in our technology and innovation eco-system - helping grow the economy, create jobs and ensuring that our region stays at the forefront of the world's start-up scene," said Kitchener Mayor Berry Vrbanovic.
Waterloo Region has earned a reputation in the wider tech community as a good place to locate talent. No longer seen as a wannabe Silicon Valley, many companies, such as Google, EA Sports, Shopify and D2L have established offices in the area because it makes strategic business sense.
"With two world-class universities and a leading-edge college, we have lots of great talent in this community. Several start-up businesses, such as Thalmic Labs and Kik have emerged from Velocity and have made this region their home base. Their presence here in our community creates new jobs, contributes to our local growing economy and makes this area the vibrant community that it is," said Mayor of Waterloo Dave Jaworsky, who is himself a former Blackberry executive.
After taking over space vacated by Google, the recent expansion of the Velocity Garage means there will be space for 120 companies. Most of the companies are tech-focused, however the sectors within technology have diversified. The expanded area has support for a workshop, a prototyping lab, an electrical prototyping room, a science lab and BSL 1 clean room, and a host of other research supports available through University of Waterloo. "The companies have evolved from strictly software-based, to hardware with a software component, unique health-based applications and other hybrids. It's hard to build companies that involve multiple technical aspects but we provide the core infrastructures to allow companies to innovate. We have something unique and hard to replicate," said Shah.
December 16, 2016
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All figures are in Canadian dollars unless otherwise noted. Information is accurate at the time of publication.