Derek Luke is the CEO of InteraXon – the Toronto-based technology company that created Muse, a headband-shaped device that analyzes brain patterns and is used for meditation.
What was your first export sale?
Our first export was to Gaiam [a healthy lifestyle brand], in the U.S. in 2014.
How did that first export opportunity arise?
We met them at the Consumer Electronics Show, which happens every January. We go every year. That’s where we met the person with whom we’re doing the licensing deal and it’s where we’ve met most of the people to whom we’re exporting.
When it comes to exports, what do you know now that you wish you’d known then?
Penetrating the U.S. market is very different from penetrating the Canadian market. We were a bit slow in bringing in expertise to do that. Orders don’t just come to you. You really need to create a presence and have the people internally to deal with it. There are also questions when you start paying taxes in the U.S. and setting up entities. The U.S. is quite easy because it’s next door and we’re all familiar with it, but how do you take that success and build a European or Asian presence?
How has the trading world changed since you started in business?
Companies should really understand their IP. We were big champions of intellectual property early on. I think as Canada is really starting to build up our version of Silicon Valley and innovation in the Toronto-Waterloo corridor, we have to think about protecting Canadian innovation. It’s probably easy to build a company to $50 or $100 million, but how do you build one that keeps the IP and royalties in Canada? How many just get swallowed up into the U.S.?
What is the #1 thing new SMEs need to know about export and trade?
First, they should go find their representation at EDC. It’s more than a place to get loan guarantees. There’s deep knowledge and mentorship available. Also, don’t be shy to engage other companies and support networks available to figure out what you need to do. They will teach you about exports and trade. The other thing I encourage people to go to is Global Affairs Canada’s Trade Commissioner Service. Look for the value-add that these relationships can bring.