Celebrating the Growth of the ICT Industry in Saint John;

Launch32 – 36 Month Report

January 2008
Overview of Launch32
Launch32 is a campaign to recognize and encourage growth in the ICT sector through the visible celebration of
our business builders. Launch32 has a bold target of establishing 32 new ICT businesses within the Greater
Saint John Region in 36 months. The companies may be created or relocated. This initiative was announced
during the Ignite Summit in November 2004 while simultaneously announcing 4 new companies to the region
and the creation of propelsj. Through this report, we measured the growth of companies and the growth in
companies at this 36-month milestone (December 2007).

There are several propelsj initiatives and activities which are integral to the success of this campaign. They
include Catalict, the propelsj technology accelerator, Project DNA (UNB study of the current state of the ICT
industry in Saint John), the Marketing and Communications Plan, as well as business recruitment activities
with partner organizations.

Catalict, launched in Fall 2006, is the primary tool with which propelsj supports start-up ICT companies. This
support includes mentoring, supporting and facilitating placement, media engagement, and partnership with
the University of New Brunswick (UNB) and the New Brunswick Community College (NBCC).

Launch32 engages the marketing process by promoting the vision of Catalict with the private sector, the
University and Community College and including engaging in discussions, lectures, and presentations designed
to increase awareness and support of the acceleration activities. Project DNA provides a description of the
sector itself and recommended systemic improvements designed to improve the environment including
support mechanisms such as access to capital and markets.

The main conclusion drawn from the program at this milestone is that a very positive atmosphere and
ecosystem of support is developing in the region around entrepreneurship and business development in the
ICT sector. Other potential entrepreneurs should be encouraged by the network that is developing and the
success that is being realized here. The community should be encouraged that Saint John is a good place to
start a business, find a partnership, and build a 21st century economy.

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Launch32 36-Month Report

Progress to Date
20 Businesses
Launch32 was presented to the public at the Ignite Summit in November of 2004 at the same time that
propelsj was launched and 3 new Launch32 companies were presented to signify the start of the campaign.
By the end of the 36 month period 20 businesses have been launched.

Talent
The 20 new ICT businesses launched in Saint John since 2004 employ a total of over 210 staff in Saint John.
Additionally, some 35 staff are employed in other areas of New Brunswick and 10 are employed outside the
province.

Revenues
Start up companies are not usually characterized by large or consistent revenue generation and, as such,
patience and perseverance is required. However, a good deal of success has been realized by Launch32
companies resulting in total revenues generated by Launch32 businesses of $16.6 million.

Steady Growth
According to the Canadian ICT Sector profile, companies employing 50 to 100 employees make up only 2.6% of
the sector. This highlights Launch32 company Mariner Partners (employing 73 staff in Saint John) as a
notable success. 14.3% of the sector employ 10 to 49 staff and there are 3 Launch32 start-ups, Brovada
(employing 22 in Saint John), Ambir (employing 17 in Saint John) and Radian6 (employing 16 in Saint John)
which meet this criteria.

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Launch32 36-Month Report

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Launch32 36-Month Report

Profile of the Canadian ICT Sector
Following is a list of information on the Importance of the ICT industry, defined as producers and sellers of
information and communication technology (ICT) products and services, to the Canadian economy

The Talent Pool

1. Employment in the ICT sector is characterized by highly educated personnel. In 2006, 41% of all
workers had a university degree, compared to a national average of 23%.

2. Employees in the ICT sector are also well compensated. These workers earned on average $56,465
(accounting for $5,801 in provincial taxes) in 2006, or 45% more than the economy-wide average of
$38,848 (accounting for $3,100 in provincial taxes). This clearly shows that the average ICT employee
contributes almost two times the amount of the average New Brunswick employee to the Provincial
Government.

3. Employees in the software and computer services industries are the most highly paid. In fact, average
earnings in these industries were $61,884 in 2006. Despite being the lowest paid workers ($47,940) in
the ICT sector, employees in the electronic components industry still earned 23% above the national
average.

4. Employment in the ICT sector has continually risen since 2003, and is now 0.8% above 2005 levels.
Total number of workers rose from 439,710 to 572,107 between 1997 and 2006, at an increase of 30%
(3.0% average annual growth, compared to 2.1% economy-wide). In 2006, 3.5% of all Canadian workers
were employed by the ICT sector, up from 3.2% in 1997.

5. Most of the employment gains have occurred in the software and computer services industries, where
the number of workers was 71% higher in 2006 compared to 1997. For the past nine years,
employment in the telecommunications services industries has recorded uninterrupted growth, and is
now 20% higher than in 1997.

Size and Revenues

6. The Information and Communications Technologies (ICT) sector is comprised of nearly 32,000
companies, mainly attributed to software and computer services (79%), ICT wholesaling (11.0%), and
ICT manufacturing (7.2%).

7. Over 97% of companies are small in size. Specifically 81% of companies employ 1 to 9 personnel, 14.3%
employ 10 to 49 personnel, and 2.6% of companies have 50 to 100 employees. On the other hand,
medium to large size companies account for only 2.4% of the sector, but have a large influence.

8. Total revenues rose from $96 to $139 billion between 1997 and 2006, a 45% increase (or 4.2% annual
growth).

9. Since 1997, economic activity for the ICT sector has increased continuously, with the exception of
2001, and in 2006, GDP grew by 4.8%. On average, annual growth in this sector has been 8.0% since
1997, over twice as fast as the overall economy (3.4%). This faster growth also means that the ICT
industries have accounted for 11.5% of the Canadian GDP growth since 1997.

10.After the substantial reduction in 2002, R&D spending in the ICT sector has steadily increased since
then, and is now at $5.7 billion, up 0.6% from 2005. This amount represents 39% of total Canadian
private sector R&D expenditures.

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Launch32 36-Month Report

(Source: Industry Canada http://www.ic.gc.ca/epic/site/ict-tic.nsf/en/h_it07229e.html)

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Launch32 36-Month Report