We have successfully exited our investment in mnubo, a Montreal-based Industrial Data Analytics & AI software company. AspenTech (NASDAQ: AZPN)  will acquire mnubo in a $102 million all cash transaction. This is the second company in McRock’s portfolio that AspenTech has acquired.
 
McRock initially invested in mnubo’s Series A financing in 2015 alongside White Star Capital. McRock invested further capital in mnubo’s 2018 Series B financing led by Munich-Re Ventures.  McRock’s Whitney Rockley has been a member of mnubo’s Board of Directors since McRock’s initial investment.
 
mnubo is widely considered one of the most innovative analytics companies. It helped ignite the AI movement in Canada and demonstrate that one analytics platform is capable of serving multiple markets including industrial ones. The acquisition of mnubo by AspenTech is further validation that we are building world-class tech companies that deliver exceptional returns to investors.
 
As part of todays’ announcement, AspenTech is opening a Montreal-based AI + IoT Center of Excellence to build on Montreal’s world-class AI talent pool. The majority of mnubo’s 60 employees are in engineering and data science. All mnubo employees are joining AspenTech and the business will continue to operate out of Montreal.

This is a huge win for the mnubo team, the Montreal AI ecosystem and McRock's investors.

Not a lot of things get me riled up these days. I don’t know if it is because I am older and have seen (and experienced) a lot over my 48 years but this weekend I was legitimately pissed. And it all started sitting in my car out front of my Taekwondo gym waiting for the instructor to arrive, so I could get my daily dose of kicking.

A friend of mine sent me a text encouraging me to read an article written by LiisBeth, a group that claims it is “the world’s only dedicated voice and advocacy organization for the entrepreneurial feminist movement”. I had time to kill so I launched the link and read the article. It was brutal. It was not focused on advocating for women. It was focused on crapping all over the first organization in the world that invests a lot (and I mean A LOT) of capital to advance tech companies with women in the C-suite.

The Business Development Bank of Canada (BDC) launched the world’s largest Women-in-Tech Venture Fund just under two years ago. And, the person who stepped into the arena to take on this fight is Michelle Scarborough. I cannot even imagine the amount of blood, sweat and tears Michelle and her team have shed to get this program off the ground while everyone else has been watching from the sidelines or merely lying dormant.  

And what does this LiisBeth group do? They decide to critique the one gladiator that has the courage to take on the first of what will be many, many fights. They start the article by saying “we are watching”. Yeah right. If they are really “watching”, they would not be watching her. They would be watching all the nay-sayers and silent ones wishing this feminist movement would just go away. They would be fighting alongside of her and helping her win. Instead they tell her to step aside and start over.  

So thanks LiisBeth for watching the one group trying to make a difference and not watching the hundreds of others that have no intention of ever changing. What you have shown us is that you are not a feminist and you certainly are not Lisbeth Salander, the character you aspire to be. You are just a mean “girl” who delights in being a bully from the bleachers hissing at the gladiator trying to change the world.

My call to those of us out there who have been fighting the real fight is to recognize that the really hard fights are just that. Hard. Mistakes will get made along the way. We will stumble and get marred because that is what needs to happen to make real progress. BDC, Michelle Scarborough and certainly not the female entrepreneurs they have backed need you to criticize them. For that, I give you a rating of “WTF”.   

​The tech sector and private capital industry will never get out of the starting blocks and jump over the first, second and third hurdles of this race if we have “supposed” supporters on the side lines with trip wires watching and criticizing our every move. We need cheering, encouragement and hope.  

We need the women and men in this industry to rally behind one another so major change can happen. Not just to improve the gender mix but to build a more inclusive industry with people from all different orientations, backgrounds and ethnicity. You don’t do that by critiquing the ones that are trying to figure it out.

So LiisBeth and the other nay-sayers out there. Piss off. You aren’t badass. You are pathetic.

​Author: Whitney Rockley, Founder & Managing Partner of McRock Capital

International IoT Day is April 9 and to celebrate we have asked our team to select their favorite Industrial IoT company. To be fair, we agreed not to name any companies that McRock has invested in (yet). Congratulations to the five IoT companies that made our list. They cut through the noise of thousands of companies and inspired our team. Happy International IoT Day 2019!

Tencent, the 20-year-old consumer Internet giant operates China’s dominant social media platform, WeChat, with over one billion monthly active users. The company announced it will begin focusing on industries seeking deeper business integration with internet technologies given the huge potential of the industrial internet.

“We believe that the first stage of the mobile internet, the consumer internet, is drawing to a close and the second stage, the industrial internet, is kicking off. With the digitalization process ongoing, the main battlefield of the mobile Internet has moved from the consumer internet to the industrial internet,” said Tencent Founder and CEO, Pony Ma.

The culmination of many technological advancements over the past 100 years has led to the power of today’s mobile Internet. A combination of affordable compute power, data storage, software applications and connectivity has created a powerful Consumer Internet. Along the way it has created some of the most valuable companies in the world like Amazon, Google, Facebook, Tencent and Alibaba.

Tencent’s founder believes the next phase of the mobile Internet is the Industrial Internet. Building off the technology of the Consumer Internet, the Industrial Internet is adding two important advancements. One, it’s connecting and digitizing the vast physical world of machines, equipment and infrastructure. This advancement has largely been the efforts of the past 5 years. The second major advancement is around next generation data analytics commonly referred to as Artificial Intelligence (AI). The way to conceptualize the relationship between the IoT and AI is like the body and the brain. The IoT, connecting data from physical devices, is akin to the body and software driven analysis and decision making, AI, is analogous to the brain.

As with the evolution of the Consumer Internet, the more people that are connected to the network, the more valuable the software application layer becomes. Likewise, as massive amounts of data are connected to the network from physical assets, the potential for AI to unlock new value is massive. It will create new competitive forces in every industrial sector, unlock new revenue streams and create entirely new business models.

Tencent has announced plans to expand into smart services for transportation, manufacturing and urban development. Their new direction is also in line with China’s wider ambitions to lift its industries up the value chain and better compete globally in emerging technologies, such as AI.

Tencent will also form a new technology committee that will create an internal platform for the sharing of fundamental technologies within the company and apply them to different industries. This should help Tencent rapidly build an ecosystem for supplying new technologies such as cloud computing, big data and AI tools to industries undergoing digital transformation.

What we are witnessing is the battle for the future of businesses. As technology innovation continues its accelerating path forward, only the existing industrial companies that execute an aggressive digital strategy will survive as a new breed of tech-savvy Industrial Internet companies emerge.

Author: Scott MacDonald, Founder & Managing Partner of McRock Capital

Today, the Honourable Mary Ng, Minister of Small Business and Export Promotion announced the second round of investments under the Venture Capital Catalyst Initiative (VCCI). Whitney Rockley, Co-founder and Managing Partner of McRock Capital, and several VC leaders were invited to attend the announcement in Montreal.

The VCCI program was created to provide capital infusion for innovation through private sector investments, with $400 million committed by the government over three years as approved in the Budget 2017. Five Fund-of-Funds were named to receive $350 million from the first stream according to an announcement made in June 2018. The awarded firms are HarbourVest Partners, Teralys Capital, Kensington Capital Partners, Northleaf Capital Partners and Hamilton Lane.

Under the second stream of the program, the government is allocating $50 million to investment managers with a diverse fund management teams or ones that demonstrate focus in supporting under-served populations or emerging regions and sectors.
The seven investment managers to receive investments under the second round of VCCI are:

• Garage Capital (Waterloo)
• Build Ventures (Halifax)
• Tandem Launch (Montreal)
• Highline BETA (Toronto)
• AmorChem (Montreal)
• Pique Ventures (Vancouver)
• Brightspark Ventures (Montreal and Toronto)

Each of the seven winning VC firms will receive anywhere from $5 million to $15 million. All recipients will continue to show strong support for diversity and the participation of women across the venture capital ecosystem. They must raise $1 for every $1 from the government and invest at least 60 percent of the fund in domestic startups.

The announcement reiterated the Trudeau government’s commitment to promoting gender balance and the future success of cultural minority groups in the VC industry and the tech sector. The program is making significant impacts in accessing venture capital investment dollars across the country to accelerate innovation, job creation and economic growth. This marks another important milestone for the Canadian innovation ecosystem when diversity and inclusion become the fuel to help increase Canada’s economic competitiveness on a global scale.

To celebrate International Women's Day 2018, we honour some of the inspiring female pioneers in the Industrial Internet of Things sector. There are obviously many more incredible women so please keep doing what you are doing and changing our world.

“Humans fancy that there’s something special about the way we perceive the world, and yet we live in loops, as tight and as closed as the hosts do, seldom questioning our choices, content, for the most part, to be told what to do next.” 
— Dr. Robert Ford in “Westworld”

“Westworld” is an HBO series about a Western-theme futuristic park, where its visitors are enabled to live their fantasies with robotic “hosts.” The hosts, while looking and acting human, are programmed to operate within a narrative. Any “host” who behaves differently from their storyline will be considered an error and needs to be fixed or dismantled. The hosts become victims in the world that’s supposed to be theirs.

It is fascinating how similar our human world is to the Westworld. Together as a society, we create plots for each individual, based on our race, our background, our genders, elements that we are born and raised with and are unable to influence. Let me tell you my original narrative: I was born in a Southeast Asian country, in a middle-class family, and in a generation that had yet to escape from the influence of Confucianism. I have the look of a plain Jane according to our culture, and a typical smooth upbringing with parents who loved and protected me from everything. I was expected to stay with them until I married (typically by age 25), after having children I would step away from my career to take care of my children, my husband and later, my parents. It was the best life that I was taught to wish for. Then I started to wonder why life had to be that way. I had lived so long in a circle of people with the same mindset, who accepted their designed narrative without questions. I had known at the time, that if I wanted to see other possibilities for my story, I had to break out of that loop. And that was why I moved away, to a city I never lived in, and then to a country half the world away from my homeland.

The loops are everywhere. Social expectation and people’s opinion influence our values. And when the voice of the crowd is honeyed and close enough, it tightens the loop around our minds. Truth is, the more privileged we are, the harder it becomes to challenge our status quo. A life with comfort and approval creates the illusion of belonging; it keeps us away from questioning our reality. That is the worst loop we could ever live in.

I remember the first night in a city 700-miles away from my hometown, I lay on the floor of a cold and almost empty room, worrying about my next day at the new job. I missed the safe and warm feeling of my bed, the routine pleasure of my old life; and I wondered if I had made a mistake.

There were days when I stayed late, looking out of the window from a fancy office on the 57th floor. A big city with blinding lights layered on my shy reflection. In a moment, I could see both beauty and ugliness, both clarity and doubt. And I did not know what to believe in.

No matter who we are, we will continue to encounter the loops. Whenever we get out of a circle, there is another one wrapping in. Society today encourages people to change for a satisfying life. We share stories about those who make it through, and how much better their lives become. Yet, by doing so, we create another formulated plot of happy ending, in which we tend to ignore the parts that involve constant pains, conflicts, and adversity. Indeed, all those untold sufferings are the essential forces that drive us to expand our thoughts, and eventually break us free.

There is no happy ending. In fact, there is no ending. I started to realize now, that the adventure to challenge our being is an eternal journey inward. Each of us may still be generalized into an archetype by the outer world, but it is the freedom of our minds that gives us courage, makes us alive, and enables us to write our own unique stories.

So, observe and think by yourself. Don’t let the world distract you. Don’t let people tell you about your narrative. Stay conscious. Ask questions. Challenge the rules.

Nothing could ever hold us back.

Author: Ha Nguyen

I nearly crawl out of my skin when I hear someone say the words “don’t be afraid to fail and fail fast”. As an entrepreneur, those words trigger me because anyone who has faced real failure will know it hurts in unimaginable ways.

As an entrepreneur, I lost count of the sleepless nights I had in the first few years of starting our business. My son, who was 10 years old at the time, kept asking, with hopeful eyes, whether we had secured our funding yet. I had to repeatedly say “close” when I knew we were still miles away. I woke up in sweats worried that I was approaching failure personally, professionally and financially. I knew that if my co-founder and I had failed, the wipe out would have been devastating. That fear of failure drove us to ignite our imaginations so we could figure out how to succeed. Had we “failed and failed fast”, we would NEVER be where we are today.

Being creative in difficult situations and adapting when things are trending poorly is not a moment in time worthy of the failure title. These moments are the exact opposite. They are the moments that define a person’s success. So, when I hear someone say, “don’t be afraid to fail and fail fast”, I know that they are not an entrepreneur.

If you use that expression, I would encourage you to change it up. For those entrepreneurs facing failure, challenge yourself to think even more positively. Have the courage to change tact and try new approaches. Push yourself to do better and better each day so you can get back on track. A positive mindset is everything and the word failure shouldn’t enter your vocabulary. Please stop glorifying the F word. Be afraid to fail and fight hard and long to find success.

That is my wish for entrepreneurs pursuing the crazy dream of changing the world.  

Author: Whitney Rockley

The Canadian technology and VC community gathered in Toronto today to hear the much anticipated details of the Canadian Government's $400 million Venture Capital Catalyst Initiative (VCCI) first announced in the Budget 2017. Whitney Rockley, Co-founder and Managing Partner of McRock Capital and Chair of the Canadian Venture Capital and Private Equity Association was emcee and the announcements were made by the Minister of Innovation, Science, and Economic Development, the Honourable Navdeep Bains, the Leader of the Government in the House of Commons and Minister of Small Business and Tourism, the Honourable Bardish Chagger, and Mr. Michael Denham, President & CEO of the Business Development Bank of Canada.

VCCI details:

• $400 million managed through the BDC.
  
• Focus on addressing diversity and inclusion within Canadian VC fund managers emerged as an important new element of the program directed by the Prime Ministers Office.
• $350 million Fund-of-funds manager program to to leverage private capital ($2.25 for each VCCI dollar) that will ultimately be deployed into Canadian focused venture capital fund managers.
  
• Fund-of-funds managers can range in ultimate size from $150 million to $400 million each, injecting a total anticipated $1.5 billion into the venture capital ecosystem.
  
• Fund-of-funds managers must ensure 60% of total capital goes into Canadian venture capital managers and at least 35% must ultimately end up invested in Canadian companies.
• $50 million for "alternative investment" fund managers not typically considered by traditional Fund-of-funds managers aimed at identifying woman, cultural minorities and other under-represented groups in addition to other innovative models not captured by the Funds-of-funds.
  
• Deadline for Fund-of-Fund manager submissions is Feb 23, 2017 - Calls for expressions of interest
  
• Selections will be made in the spring by Minister Bains with input from a six person industry expert selection committee that has yet to be selected.
  

The following is an op-ed by Whitney Rockley which appeared in the Globe & Mail.

Almost 20 years ago while working as an analyst, I remember sitting across the table having breakfast with my mentor, Gerry Protti, complaining about my bonus for that year. He looked at me and told me to suck it up. Looking back at that moment, I smirk and quietly laugh at myself. I was so young and ambitious, but I needed to toughen up. Gerry's words were brilliant.
I graduated at the top of my MBA class at the University of Calgary in 1997 and was told Gerry would be my formal mentor during my last term at school. He was an oil executive, big in statue with a kind demeanour. Gerry became my coach and sponsor for the next 15 years of my career. He gave me my first job out of MBA school, encouraged me to take a one-year work assignment in San Francisco shortly after my son was born in 2001, and then urged me to co-found McRock Capital, an Industrial Internet of Things venture capital (VC) fund, in 2011 by simply saying, "What do you have to lose? It is only money."

Today, I am one of the few women who have co-founded a venture capital fund in Canada. I am also the first woman to be the chair of the Canadian Venture Capital and Private Equity Association (CVCA) since its inception in 1974. Many young women ask me how I have done it. The answer? I worked hard, almost obsessively and simply didn't quit.

I have, however, had a few definable moments throughout my career. While I was in San Francisco on that one-year assignment at a VC fund called Nth Power, I shared a taxi with the co-founder of the fund. Nancy Floyd and I were going to a women's event on a dark and rainy evening. I told her I was uncertain about having a second child because I wasn't sure I could manage a career and more than one child. Her response, like Gerry's, consisted of three words "Just do it." A year later, my daughter was born and those words have become my motto throughout my career.

Several years later, I was heading up a corporate venture capital program for a big power company back in Alberta. I worked for an incredibly tough and demanding boss. Words can't describe how tough this man was. Gerry's words stuck with me. I stayed the course, gave it my all and learned how to be crisp and succinct when something was complex and difficult to understand.

When my boss left the company, I wrote him a kind note expressing my thanks for pushing me. He came down to my brown-water cubicle (because it faced the men's urinals) with big eyes of a child. He shed a tear that day because no one had ever thanked him, let alone taken the time to write him a handwritten note. Looking back on that experience, I was proud of myself for not quitting and being able to see the human side of difficult people.

Later in my career, I moved to London, England, and worked for one of Japan's largest banks, Nomura. My name was put forward by my now co-founder, Scott MacDonald, who was approached for the job. Scott and I had been co-investing together since 2001 and had developed a strong rapport. A few years after working in London, I was offered a partner position in a VC fund based out of Switzerland, where Scott was already a partner. Perhaps not surprising, it was Scott who put my name forward for that position as well. He staked his reputation on me three times throughout my career.

Looking back, one of the things that I noticed in my mid-30s was that most of the women I knew in the industry were not staying the course. There wasn't a big dark secret as to why they were leaving. Based on my observations, many of them simply had started families and didn't want to stay in the fast-paced, relentless career of venture capital. I didn't judge them because I knew it was hard.
As I nudge towards my 50s, I know of only three or perhaps four women who are managing partners in Canadian VC firms. I interact with female entrepreneurs who struggle to raise funding from investors. I consistently hear it is because they don't look and sound like the men they are pitching to. In some situations, I think this is the case but the sample size is so small it is difficult to generalize.

I also speak regularly to young aspiring women and I am saddened because they are reluctant to be mentored by senior men because they do not know if there is an ulterior motive. I worry that the diversity gap is growing larger by each passing year because women are not getting enough guidance, support and investment. The senior men that I know and trust sincerely want to offer mentorship to women but, unlike when I started my career, they are understandably cautious so they tend to support more up-and-coming men. Senior women like myself are mentoring more and more women because of this gap.

Obviously, these problems are complex and won't be resolved overnight, but the government's new plan to support the venture capital industry, which will be announced Monday, is a formal acknowledgment of the important role diversity plays in Canadian businesses. As chair of the CVCA, I ensured our industry's voice was heard and that diversity and inclusion were among our top priorities. We have taken a monumental step as the Venture Capital Catalyst Initiative (VCCI) will, in part, require fund-of-fund managers and VC firms seeking funding to demonstrate how their strategies will enhance diversity and gender balance. The government of Canada is doing this because it understands a diverse work force improves productivity, enables creativity and drives better financial performance.

When I retire, I want to be able to look back and see far more female partners leading VC firms in Canada. I want to hear about the women who founded and ran successful tech companies that rivalled the tech giants of our time. I know we can get there if we do our part to encourage them to stay the course and simply never give up.

Author:
Whitney Rockley
Co-founder and Managing Partner, McRock Capital
Chair of the Canadian Venture Capital and Private Equity Association (CVCA)