Canada needs a 'much stronger startup engine': Former Cisco CEO

John Chambers, the former CEO and chairman of Cisco Systems Inc., says Canada and the U.S. are not moving fast enough when it comes to innovation.

“The warning signal to both Canada and the U.S. is that we’re not changing fast enough,” Chambers told BNN Bloomberg in an interview Thursday. “You see countries around the world such as China or India starting to explode faster.”

Chambers joined Cisco in 1991, and later became chief executive of the tech giant – a position he held for two decades – where he took the maker of Internet routers into the world’s biggest networking equipment manufacturer. He stepped down as CEO in 2015 and resigned as the company’s chairman last year. He announced he invested $100 million in the startup world through his company JC2 Ventures earlier this year.

Chambers argues all future job creation will happen through startups and that big companies will probably decrease their headcounts over the next decade.

“Forty per cent of the large companies like Nortel, like other companies in the U.S. will just disappear,” he said.  

“In Canada and the U.S., we don’t get the startup engine running much faster, we are going to have trouble not just with job creation but also the average household income,” Chambers added.

“And if you believe that artificial intelligence and digitization will destroy jobs, then you’ve got to get a much stronger startup engine to generate the 30 million jobs we need in Canada and the U.S. over this next decade.”

Chambers said a national policy needed for this to happen in order to increase the number of unicorns, or startups that reach a valuation of $1 billion, in the U.S. and Canada.

“For a country to lead in this digital world and startup world in innovation, it starts at the very top,” he said. “The country’s leader has to outline a crisp view of digitizing their country, what that means to GDP, communicate what that means to startups and with startups goes the economic engine and job creation of their country.”

Chambers pointed to French President Emmanuel Macron and India’s Prime Minister Narendra Modi as examples of leaders who have done this effectively for their countries.   

“I think I’d give Canada good marks on the vision,” he said, adding that countries need to foster an environment that enourages venture capital and expertise to come in.

Amazon has plans to increase its workforce in Canada and Toronto is on the short list for the tech giant’s second headquarters. But the Canadian business community has voiced their concerns that the country’s tax policy hinders its ability to attract and keep young talent.

“You’ve got to create an innovation environment,” Chambers said. “You’ve got to encourage young people to get excited about going into this field.”

“If we don’t change this paradigm, we’ve got a problem coming at us.”