In a year of bad news for businesses in Newfoundland and Labrador and the world as a whole, it’s perhaps understandable there would be so much collective excitement over Thursday’s announcement that Nasdaq Inc. is purchasing Verafin.
The US$2.75-billion deal for a business offering anti-crime management solutions to financial institutions comes with a lot of strong commitments from the new owner.
Those commitments are largely built on growing the St. John’s-based technology company.
Nasdaq is onboard for further investment and more jobs in Newfoundland and Labrador’s capital city.
That’s music to the ears of TechNL’s Paul Preston, who represents a growing sector that expects to create a lot of new jobs in the years to come.
“This really puts this place on the map in a big way,” said Preston, the organization’s CEO. “It shines a big light on our province and on what you can do from here. It’s going to help people understand you can create a company and grow and scale a company from right here in this province. You do not need to be in Toronto or New York City. You can be über successful staying here, and there are amazing supports to help companies do that.”
TechNL was already expecting big things from Verafin, but Preston said this news raises those expectations.
“We already expected Verafin to hire a few hundred people in the next three-to-five years,” he said. “This really means that there may be even more need to hire with this scale and scope that they have through the Nasdaq deal.”
Educational support
Thursday’s announcement came with some supports specific to the province. Verafin got its start in 2003 through Memorial University’s innovation hub Genesis (known back then as the Genesis Centre), and the company’s founders graduated from Memorial’s engineering program. Nasdaq said in a news release it’s going to support Genesis through a US$1-million research and development partnership project.
“Deals like this in Canada happen very rarely. For a deal this size to happen in Newfoundland and Labrador is really incredible,” said Michelle Simms, Genesis president and CEO. “This opportunity with Verafin and Nasdaq ... is a very big and exciting one for the economy of Newfoundland and Labrador and building out the startup and entrepreneurial communities here.
“I think we’ve made big strides in the last five years in growing the entrepreneurial community, especially in the technology sector. I think what you’re going to see now is a rapid acceleration of that, and the support from Verafin and Nasdaq will certainly go a long way in helping to expedite that rate of growth.”
Thursday’s release included other nuggets of good news for MUN that address Verafin’s growing labour needs. Nasdaq will reportedly work with the university to grow its scholarship program, aid its co-op programs and fund and supervise at least six Mitacs fellowships annually for Masters and PhD students.
MUN president and vice-chancellor Vianne Timmons — thrilled to see a company so rooted in the university giving back to it — said Memorial is actively looking at ways to produce more graduates that can serve the needs of Verafin and the growing provincial technology sector.
“We’re already looking at two new programs that we can potentially launch that would increase the number of graduates that would come out with technology expertise to work in companies like Verafin,” Timmons said. “We’re absolutely looking at ways we can increase the capacity of Newfoundland and Labrador to have employees with the technology knowledge they need.”
Premier reacts
Premier Andrew Furey spoke with Nasdaq CEO Adena Friedman and Verafin CEO Jamie King the evening before news of the transaction was made public. Furey, who also recently toured Verafin’s St. John’s office, said he’s excited to see how committed both companies are to the province.
“We cannot overstate the importance of this project right now,” he said. “This is not just about Verafin. This is about massive opportunities for the future of Newfoundland and Labrador in the technology sector. They’re leading the way, and there’ll be many more that follow.”
On that point, Preston would agree. He noted Genesis currently has 26 startups incubating and a few more on the way and added there are a number of local technology companies with big plans ahead of them.
“This won’t be the last acquisition that we see here,” he said. “I think this has placed us on the map in a big way. We’re going to see more capital, more investors wanting to come here to understand what is taking place here. We’ve talked about the uniqueness of this place. There’s a lot of healthy, strong supports and people that want to see the tech sector grow. That’s getting worldwide attention now.”
Industry, Energy and Technology Minister Andrew Parsons said the province recognizes more needs to be done to ensure there’s a labour force with the right skills to serve the growing tech sector. He hopes younger people take notice of Thursday’s news.
“Like I said to Jamie (King), ‘I want your story to be the one that’s told to kids in Port aux Basques, that’s told to kids in St. Johns, told to kids everywhere,” the minister said. “He’s from Bonavista Bay and a true Newfoundland and Labrador success story. Born and bred here, educated here, and makes this amazing, world-class company worth billions, right here in Newfoundland and Labrador. Sometimes you need a tangible success story to see the direction you want to go in. They are a shining example of that.”
