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Episode 25: Indigenous entrepreneurship in Canada
Indigenous entrepreneurship is expanding in Canada, with an increasing number of funding and training opportunities becoming available to foster the growth of Indigenous businesses. According to the Canadian Council for Indigenous Business, in 2022, there were roughly 60,000 Indigenous businesses in the country.
In this episode we’ll discuss the rapid growth of Indigenous business, what the impacts are on the economy and what the future of Indigenous entrepreneurship looks like within Canada.
Michael Mihalicz, Indigenous Advisor with the Office of the Dean at the Ted Rogers School of Management and Assistant Professor in the Entrepreneurship & Strategy Department, to shares his expertise in decision making, Indigenous entrepreneurship, and investments in training and education.
Podcast Transcript - Episode 20 |
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| Cassandra Earle: | Indigenous entrepreneurship is expanding in Canada with an increasing number of funding and training opportunities becoming available to foster the growth of Indigenous businesses. In 2022, Indigenous people contributed close to 50 billion to Canada's economy. According to the Canadian Council for Indigenous Business in 2022, there were roughly 60,000 Indigenous businesses in the country. Today we'll be discussing the rapid growth of Indigenous business, what the impacts are on the economy, and what the future of Indigenous entrepreneurship looks like within Canada. I've invited Michael Al's, Indigenous advisor with the office of the Dean at the Ted Rogers School of Management and assistant Professor in the entrepreneurship and strategy department to share his expertise in decision-making Indigenous entrepreneurship and investments in training and education. I'm your host, Cassandra Earle, and this is Like Nobody's Business. |
| Michael Mihalicz: | My name is Michael Mihalicz. I'm a faculty member in the entrepreneurship and strategy department. I earned both of my degrees at TRSM. I started out a while ago with my Bachelor of Commerce, and then I went on to complete the master of science and management with a focus on behavioral economics. And currently I'm also a PhD student in the accounting and finance program at the University of Glasgow. So I'm also the special advisor to the Dean on Indigenous initiatives at TRSM. And this is partly what drew me to learn more about this topic and start to get a little bit more involved because I recognize the potential that Indigenous entrepreneurship offers as a path to economic independence and self-governance. |
| Cassandra Earle: | Indigenous businesses and their contributions are continuing to amplify the Canadian economy with data from 2020, putting the value at close to 50 billion. In what ways is indigenous business growth contributing to Canada's economy? |
| Michael Mihalicz: | Indigenous business growth is contributing to the Canadian economy in a lot of different ways, and one of the main ways is through providing a different perspective in providing diversity of thought and diversity of experience and bringing that to the business landscape in Canada. It also has made a lot of contributions to GDP growth and will continue to do so. The Indigenous population in Canada is estimated to grow to more than 3 million people by 2040. And Indigenous entrepreneurs actually remain one of the fastest growing demographics of entrepreneurs in Canada. Indigenous peoples have been growing at almost double the rate of the non-indigenous population. The Indigenous population is also much younger and tend to start companies much earlier in their lives than the non-Indigenous population. And so they continue to create opportunities for wealth and employment and some of Canada's most impoverished regions, and they have a really important role to play in strengthening the country's social fabric. |
| Michael Mihalicz: | And on this last point, I think it's important to acknowledge the very strong community orientation of a lot of Indigenous businesses. In fact, it's been thought of as almost a hallmark of indigenous business or Indigenous entrepreneurship is this really strong focus on community and wanting to see their community succeed. And so entrepreneurs will often use these businesses as a tool to give back and better their communities in any number of different ways. And as members of the community themselves, I think they're uniquely positioned to provide supports in areas that are most needed and in an authentic way, in a genuine way. I think another really important contribution has more to do with the types of innovations and perspectives that are made possible through this diversity of thought and diversity of experience. And I mean Indigenous peoples have always been innovative, and it's what it took to survive and thrive on these lands for so long. |
| Michael Mihalicz: | And those values and perspectives that once enabled these remarkable achievements continue to shape Indigenous people's approaches to business and new venture creation. And so I think about Indigenous innovation and how it's been informing a lot of these modern approaches to things like sustainable land management, biodiversity conservation, climate change, mitigation, and introduced the mainstream western world to different medicines and foods and medical techniques. Because when European explorers first arrived on these lands, they were exposed to this ecosystem unlike any they had ever seen before. These lands are home to some of the most biologically diverse regions in the world. And over thousands of years, Indigenous peoples have learned to live with the land and developed an in-depth knowledge of the plant and animal life. And these plants and animals were often used as medicines to treat any number of different ailments, including scurvy. And then the medical community, they were quick to take up on this and they adopted many of these different treatments, and there was this surge of innovation in the medicinal drug industry. |
| Michael Mihalicz: | And eventually they shifted more towards these synthetic drugs because there were new laboratory techniques that allowed them to run thousands of tests simultaneously. And they seemingly had no more need for these thousands of years of learned wisdom that was curated by Indigenous peoples. But over time, innovation in that space has started to plateau, and a lot of people think that we need to look back in order to forge our path to the future. And I think the same can be said for society as a whole. And I spoke with a lot of Indigenous graduate students. One of the questions that I asked them was, what is Indigenous innovation? What does that mean to you? And more often than not, it wasn't developing the next Google. It was finding modern applications for traditional knowledge, this knowledge that sustained life since time immemorial and then braid this ancient wisdom with modern technology to enhance and accelerate innovation across all sectors of the economy, which I thought was really interesting and I think speaks to where a lot of indigenous peoples are in wanting Indigenous ways of knowing, being in doing, to be more acknowledged in mainstream society. |
| Michael Mihalicz: | So I mean, we're seeing indigenous entrepreneurs thriving now more than ever before, getting involved in a wider range of sectors like tourism and arts and media, information, technology, communication, eco-friendly ventures like renewable energy land-based industries, things like agriculture, natural resource management. And these are in part fueled by a lot of shifts that we're seeing in consumer demands. The number of socially and environmentally conscious consumers is growing and people are starting to demand more from companies than just providing great products. They want them to have a social mission and an environmental mission. And as these consumers increasingly prioritize sustainability, ethical practices, cultural preservation in their purchasing decisions, there's a rising demand for products and services that align with these values. And many indigenous businesses are innately positioned to meet this demand. |
| Cassandra Earle: | According to an article by the CBC, a group of Indigenous economic organizations are looking for the federal government to adopt new definitions as to what constitutes Indigenous businesses and organizations. Why is this step important? |
| Michael Mihalicz: | I think that's the wrong question, but it is important because they've so many commitments to increasing support for Indigenous peoples and businesses, and part of which are these social procurement policies, Indigenous procurement policies. So the federal government committed to, I think 5% of spend to Indigenous businesses to align with the population of Indigenous peoples in Canada, which make up 5% of the population. And they want to know that they're living up to that and they want to be able to show that they're living up to those commitments that they've made. And I think a lot of these different policies, not just with the federal government, but a lot of large organizations are making similar commitments. At TMU, I was on the social procurement policy working group, and we developed our own social procurement policy. A lot of large companies are heading in that direction. And so I think being on some sort of a list that legitimizes a business as Indigenous provides some real opportunities for Indigenous entrepreneurs. |
| Michael Mihalicz: | And often they are looking to third party certifications to confirm authenticity, to confirm indigeneity. So things like NACA for one, for example. And so a lot of this is partly just to ensure that they're doing what they say they're doing. But I mean, the government of Canada in particular has considerable interest in retaining control over what defines Indigenous peoples and businesses. And that's a really touchy subject because often this control has been used for nefarious purposes to assimilate Indigenous peoples into Euro Canadian culture and eradicate Indigenous peoples and culture, so cultural genocide. And so I think a better question is why is it important to Indigenous nations? And I think to answer that, it gets a little tricky because Indigenous peoples are not a homogenous group. There are 634 First Nations communities, there are Metis communities, there are Inuit and urban Indigenous communities in present day Canada. |
| Michael Mihalicz: | And each of these communities has its own history and beliefs and culture and traditions. It's why we say Indigenous peoples or Indigenous knowledge is pluralized because it recognizes that the Indigenous population in Canada is comprised of many distinct groups. So why it's important to Canada is not as good a question, I think is why it's important to Indigenous people's, nations and communities. And I think why it's important there is the role of entrepreneurship and let's say economic reconciliation in our path to reconciliation, in our path to self-determination and economic empowerment. Indigenous peoples are taking back control over their economic features. They're leading to greater autonomy and control over their lives and resources while embracing culture and traditions. I think it also helps to promote cultural awareness and understanding also by Indigenous entrepreneurs through their ventures. Indigenous entrepreneurs are able to bridge these cultural divides and foster a mutual respect. |
| Michael Mihalicz: | And I think it also has a role to play in cultural preservation and revitalization. And in Indigenous businesses often act as vehicles to preserve and pass down cultural wisdom to future generations. So all of these I think, necessitate legitimacy. And so we won't actually achieve reconciliation, economic reconciliation by supporting Indigenous businesses that are not authentic. But then what is authentic? We talked about NACA, for example, and they have adopted a definition of Indigenous business as nationality or citizenship. So you need to be a citizen of a First Nations community or Inuit, an Metis community, but then they rely on the Canadian government to legitimize nations. And so there's no easy answer I think to that, but I think it is a really important question, and we're doing a lot of good work in this space and trying to figure out what are the different implications, but I think we have a ways to go, and I think it's about more than nationality. I would hate to reduce all that it is to be indigenous to just like this one thing or these two things. |
| Cassandra Earle: | Funding for Indigenous businesses by the government is continuing to grow. The racialized and Indigenous supports for entrepreneurs or raise program is receiving a $5 million investment from the Ontario government for 20 24, 20 25 to provide free access to business coaching, training, and grants for more than 400 Indigenous, Black and other racialized entrepreneurs. At the federal level, the government is adding $2 million to the Indigenous Women Entrepreneurship Fund and is creating an indigenous youth program with an additional $500,000. Also, the Canadian Council for Indigenous Business launched its first grant dedicated to young Indigenous entrepreneurs, the young Indigenous business grant. What impacts does funding like this have on Indigenous entrepreneurship? |
| Michael Mihalicz: | I think it provides a lot of much needed capital, and I think you're going to see a lot of that capital flow through to benefit the communities of a lot of these Indigenous businesses and entrepreneurs. I think one of the reasons why one of the barriers, the major barriers to entrepreneurship for Indigenous peoples is access to capital. It's always been access to capital. It's the same for educational disparities are often grounded in access to capital among a myriad of other things. But one of the reasons why there's not the same access to capital goes back to the Indian Act that was passed so many years ago. And even to this day, Indigenous peoples can't sell land to anyone other than the Canadian government. And for a price set by the Canadian government, a lot of people in Canada, their largest asset is their home, and they can collateralize that if they need to in order to get a loan to fund a small business. Indigenous peoples don't have that luxury because they can't sell their home. Real estate has played such an important role in the creation of generational wealth in Canada, and that is Indigenous peoples don't have that same, right. |
| Cassandra Earle: | What are some of the obstacles uniquely faced by Indigenous entrepreneurs, and how does this impact their path to success? |
| Michael Mihalicz: | I think one of the big obstacles is one of those more unspoken obstacles, and it is the availability of capital, the superiority of mainstream approaches to knowledge creation. And in finance, there's what's known as the similarity effect, and it's where people tend to invest in companies or founders rather, that are like them and like them in terms of how they think and their experiences. So when you're looking at the venture capital industry, which is largely white male dominated industry, it can be difficult for someone who doesn't think the same way they do to get those investment dollars. So yeah, I think access to capital restrictions that the government has historically placed on the development of intergenerational wealth, I think those are huge obstacles. Education is also another big barrier. And of course, I don't want to get into the history of the relationship between indigenous peoples and education in this country because it's devastating. |
| Michael Mihalicz: | But I mean by almost every measurable indicator of wellness in society, Indigenous peoples in Canada are among, if not the most disadvantaged populations across all of North America. So if you look at unemployment rate, it's double that of the national average. The median total income is 60% of the non-Indigenous average, six times higher homicide rate, two times higher, infant mortality rate, lower life expectancy, three times higher dropout rate, a suicide rate that is anywhere from two to nine times that of the national average, 10 times higher incarceration rate. You look at the foster care system, over half of all children in foster care are Indigenous. A population that makes up 5% of Canada makes up over 50% of all children in foster care. And so what we're seeing right now is the result of hundreds of years of violence against Indigenous people in a system that was designed to advance this agenda that directly conflicts with Indigenous interests and ways of being and violence that continues to this day. And so a lot of the obstacles that we're seeing are many generations in the making, and it's going to take time. But I'm hopeful. |
| Cassandra Earle: | The Reconciliation in Business Conference is happening at the Ted Rogers School of Management on November 3rd. It's being presented by the treaty relations in Business Education Student group, and is designed to foster inclusion and appreciation of Indigenous perspectives and encourage adapting Indigenous ways of knowing in research and education. It will feature an Indigenous marketplace, a feast research presentations, and an Indigenous business case competition. What do you think are the impacts on young Indigenous people seeing and attending an event like this? |
| Michael Mihalicz: | I think visibility is really important and we need more representation. And thankfully, we're starting to see that in a really big way, the role of entrepreneurship in Indigenous cultural resurgence. Aspiring Indigenous entrepreneurs need to see that they can be successful without sacrificing who they are and that it's in fact an advantage. So we need to show our youth and the world that you can do business in a way that maintains the integrity of our identities and experiences, and that there's not just one path to success. |
| Cassandra Earle: | And what do you hope attendees will take away from the conference? |
| Michael Mihalicz: | I hope more than anything that they will make new friends. They will come away from this event with new relationships that they can build on that are grounded in something meaningful, because I think that's really our path forward. I mean, a lot of things need to happen, but it needs to happen in a way that's grounded in our relationships to one another. And so I think coming together provides real opportunity to develop those relationships that are going to bring us to the next stage. |
| Cassandra Earle: | Like Nobody's Business. It's a presentation of Toronto Metropolitan University's Ted Rogers School of Management. For more information and to register for the event on November 3rd, visit torontomu.ca/tedrogersschool. Thank you for listening. |