Thursday, April 12, 2012

MaRS Discovery District: Ontario's most expensive Consultants

Parker Gallant on MaRs

MaRS Discovery District: Ontario's most expensive Consultants

MaRS Discovery District is a think tank created by Ernie Eves when Premier of Ontario. MaRS officially opened as a charitable institution in 2002 and by September 2005 had received $70 million taxpayer dollars. MaRS was touted as a way to capture the $1 billion in science and technology research spending in the medical sector in the University Ave. corridor. Their website claims, “MaRS is where science, technology and social entrepreneurs get the help they need. Where all kinds of people meet to spark new ideas. And where a global reputation for innovation is being earned, one success story at a time.”

One of the claims made by MaRS in their appeal for donations is, “Your contribution supports our core mission. Helping science, technology and social entrepreneurs bring new ideas to the marketplace.” The “social entrepreneurs” include a big sector touting renewable green energy headed up by Tom Rand - who was recently appointed to the Ontario Clean Energy Task Force created by Energy Minister Chris Bentley. A new sector referred to as the Centre for Impact Investing which is “a national hub to increase the awareness and effectiveness of social finance to catalyze new capital, talent and initiatives dedicated to tackling social and environmental problems in Canada” has also been created.

As a charitable institution MaRS is required to file it's annual financial statements with the CRA and a review of those statements from 2002 to 2011 filings disclose that MaRS received gross revenue of $253 million over those 10 years and of that amount $154 million was provided by governments (principally the Province of Ontario) and $4.7 million were charitable donations.
MaRS touts all of the wonderful things they bring to the province and in one web page enticing you to donate money titled “Where does the money go?” they have this to say; “MaRS is an independent charitable organization. Your contribution supports our core mission. Helping science, technology and social entrepreneurs bring new ideas to the marketplace. Through a comprehensive range of business development services, including advice, research, and education. MaRS has helped more than 1300 companies to date. Provided more than 2400 hours of market research analysis. And spent more than 2300 hours helping companies with their businesses.”

Those 1300 companies they helped over the last 10 years each received an average of 1.8 hours of “market research analysis” and 1.8 hours each of help with their businesses. A simple extrapolation of the hours spent helping out these companies shows that the research and help the MaRS team provided works out to an average cost of $54,000 per hour (gross revenue divided by the hours spent with the 1300 companies) and $33,000 per hour if one looks at only the government money provided to them.

This has to be the most expensive consultation provided by anyone in the province.

Buoyed by past success MaRS is expanding by adding a new 20 story building at a cost of $344 million to presumably provide even more market research and help to companies. The new building is being financed by another arm of the Provincial Government, the Ontario Infrastructure Projects Corp.

Perhaps the Drummond Commission should have examined the destination of funds when he prepared his report to ensure that Ontario is not saddled with successes of the type touted by MaRS.

Parker Gallant
April 13, 2012

1 comment:

  1. MaRS is full of incompetent (lacking professional education and experience in the area of finance, business, etc.) and politically correct, lazy and mediocre people. Secretive, protective of their turf, but contributing absolutely nothing of substance to our economy. More like a passive aggressive clique of insecure (for a good reason) employees who cling to this government funded source of good income that requires nothing of them except for parroting the party line without any other knowledge about anything. There is reason they keep a low profile - their financial ignorance will be busted in seconds. This is truly a scandal that needs public attention.