Trying to weave Calgary's entrepreneurial 'spirit' into cash
Millennial offering Tesla ride service among new generation of entrepreneurs — but it's a hard, long road
By Tony Seskus, CBC News Posted: Feb 11, 2018 5:00 AM MT Last Updated: Feb 11, 2018 9:09 AM MT
Tony Seskus is senior producer with CBC's Western Business unit in Calgary. He has written for newspapers and wire services for more than 25 years on three continents. In Calgary, Tony has reported on the energy sector and federal politics.
For a cool $320, you can get picked up at your door in Calgary, and be driven anywhere you want to go in Edmonton, all while enjoying the social cachet of a swanky Tesla.
It's a new startup company created by a young Calgary entrepreneur with an idea, and an angel investor.
In the aftermath of our city's economic downturn, the watchwords became "diversification" and "entrepreneurialism." These rather vague notions of how to get our economy back on track are touted by politicians and business groups alike.
"It's an attitude. It's about confidence. It's about a belief. It's about experience." - Brett Wilson
Think about all the talk of incubators and accelerators.
This idea of courageous risk-taking is part of Calgary's mythology — the story we like to tell about ourselves — and there are people here trying to take this vision, roll the dice, and live the dream.
But taking risks is, well, risky. The city is littered with the ambitions of those who aim high and fall short. Some, however, find a way.
A man and his Tesla
Enter Rosario Fortugno, CEO of InOrbis Intercity.
Fortugno, who swapped his career as an electrical engineer to study for an MBA, launched a Tesla-only ride service that will compete for a share of Alberta's business travellers, pitting the startup against the traditional bus and airline industries.
Inspired by countless hours of lost productivity driving Alberta highways, Fortugno sees opportunity in the six million trips made annually between Calgary and Edmonton, roughly a third for business.
Three years in the making, InOrbis fired up last spring and now has a roster of drivers, sedans and a crossover SUV it can draw upon to ferry clients between Calgary, Edmonton and beyond.
"I've kind of always had a passion to create a business," said Fortugno, 27, an MBA candidate at the University of Calgary. "I don't think it was a choice for me. I think it was almost a necessity."
Fortugno, an admirer of Tesla co-founder Elon Musk, has been crafting his strategy for years.
For $320, a Tesla driver will pick up a client at the door, drop them off at their Edmonton destination and bring them home the same day. Wi-Fi enabled vehicles let clients work the whole trip.
Fortugno feels he can compete with the airlines because he's generally less expensive and doesn't require clients to arrive early, navigate security or wait to board.
Buses are inexpensive but don't offer door-to-door service and aren't private. Indeed, Fortugno has found doctors and lawyers warming to the service because they can work in private.
Tesla's electric-powered luxury cars are at the heart of the strategy.
The vehicles get nearly 500 kilometres on a single charge and fit within the company's mindset around sustainability. The cars also attract their share of gawkers.
Fortugno isn't the only person putting down chips on his plan.
Though he owns 90 per cent of the shares in the private company, he's also made believers of friends, family and an angel investor, who have injected money into the venture.
InOrbis also has a six-person team investing expertise in IT, marketing and software development. The CEO's role comes with long days and sleepless nights.
"There's kind of that long-term vision and that's what keeps you going … but there are lots of little things that come up every single day," Fortugno says.
A difficult road
The entrepreneurial "spirit" that Calgary uses as its foundational story began with its founding as a frontier city, and later amplified by the early oil booms that turned one-rig oilmen into multi-millionaires.
Calgary investment banker Brett Wilson, a student of the city's entrepreneurial history, traces it back even further — to the region's first traders — and says it lives on today in all kinds of places, from machine shops to oil towers.
"The entrepreneurial spirit has been a key part of developing everything in Western Canada," says Wilson, pointing to recent developments in cannabis, electricity markets and agri-business.
"It's an attitude. It's about confidence. It's about a belief. It's about experience."
But turning an attitude into economic reality, particularly on a grand scale, is a challenge.
In Detroit, a community hammered by economic upheaval, small business entrepreneurs are leaned on, and celebrated, for helping lead a revival. But closer study has revealed mixed results — a downtown that's doing better but with struggles continuing outside the core.
The journey is hard.
Passion, good ideas and a well of entrepreneurial spirit are still guarantees of nothing.
And while politicians like to laud those who find success, the hard truth is thousands of new businesses fail every year with barely a whisper from anyone.
"The highs are higher and the lows are lower than anything you'll do, and the odds are stacked against you," says famed Calgary businesswoman Arlene Dickinson.
Still, despite the risks, thousands of new businesses will open in Calgary this year. Many new ventures will be small businesses, like a restaurant or corner store, which are vital to the health of any economy but can't necessarily re-make an economy on their own.
True entrepreneurs are rarer still, like unicorns, Dickinson says. And they're critical, especially as Calgary tries to diversify and rely less on the energy sector.
"Entrepreneurs see something that doesn't exist today, want to build something that's new and innovative, and then take to a large scale," she says, pointing to the likes of Uber and Airbnb.
If Calgary wants to be a place where entrepreneurs can thrive, the community must find ways to help identify potential talent, help them get started and provide them with support as they grow.
"We're a little too risk-averse still; we're a little too safe with our bets."
- Arlene Dickinson
A growing mound of successful small businesses can have a snowball effect, ballooning from small to mid-sized and then becoming a large company, or even attracting other big firms to the city.
One reason why Amazon left Calgary off its shortlist for a second headquarters was because the city doesn't possess enough high-tech companies, or the right-sized companies, to provide the volume of experienced staff such a hub would need to draw upon.
To paraphrase one local high-tech leader, you need lots of little fish to attract big fish.
Dickinson says the city's healthy startup community can still struggle to get attract the capital dollars needed to grow to the early or mid-stage of their development.
Some end up in the United States in the hunt for capital, Dickinson says.
"That's where the people (are) who say 'Yes, I'll take that bet!,'" says Dickinson, whose own venture capital fund has raised more than $30 million and helped more than 60 companies begin and grow.
"We're a little too risk-averse still; we're a little too safe with our bets."
She adds: "We shouldn't be trying to get Amazon. We should be trying to find the Amazon that we own."
Like many Calgarians, Fortugno hears the earnest talk about the city's future and understands the big challenges ahead for him and the community.
Failure to make Amazon's shortlist for its second headquarters touched off a wave of introspection and debate about the city's ability to reshape its economy.
During Calgary's great push for diversification in the late 1990s, countless web-based companies came and went. There will be casualties again this time. And next time, too.
But Fortugno, echoing some of Wilson's optimism, believes that while the city has taken its lumps, Calgary will find its way. There's a startup culture forming, he says, that bodes well for innovation and the future.
"A lot of us are passionate about driving innovation," he said, "and driving us forward into the future."
Calgary: The Road Ahead is CBC Calgary's special focus on our city as we build the city we want — the city we need. It's the place for possibilities. A marketplace of ideas. So. Have an idea? Email us at: firstname.lastname@example.org
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