Top of Mind in Tech: Pierce Ujjainwalla on capital gains taxes and why Ottawa doesn’t have more Shopifys

Pierce Ujjainwalla Knak AI
Editor's Note

Top of Mind in Tech is an occasional feature that asks Ottawa tech leaders what’s keeping them awake at night.

When it comes to the tech industry, Knak CEO and co-founder Pierce Ujjainwalla has a lot on his mind. 

A graduate of Carleton University’s Sprott School of Business, he started his career at large firms like IBM and Titus, working on marketing automation. Since then, he’s become an accomplished entrepreneur, starting marketing software company Knak in 2015 with the goal of making life easier for marketers. He is also the founder and board chairman of marketing and sales company Revenue Pulse. 

In this first instalment of Top of Mind in Tech, Ujjainwalla breaks down four topics that he can’t stop thinking about, from the feds’ decision to increase capital gains tax to Knak’s noisy ongoing office expansion. 

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The transcript has been edited for length and clarity.

Impact of capital gains taxes on entrepreneurship

“For any entrepreneur, small business owner, this is a huge deal. Because what it means is, if one day you ever sell your business, that’s when you’re going to have to pay capital gains tax. I think every entrepreneur should plan with the future in mind, and if you work backwards from the future, this just has a really big implication of what happens if you ever get to that point. 

“Every entrepreneur takes a lot of risk to run a business. There is no guaranteed pension at the end of the day. It’s top of mind because of what the government just approved (last week), but there’s been a lot of discussion about what it means for the future of tech businesses or any businesses in Canada in the future. Especially in contrast to other countries. There are several other countries that actually have zero per cent capital gains tax. As a signal from the government to entrepreneurs, it’s not a great one.”

Scaling founder-led sales 

“At Knak, I feel like we’ve been here for a while, and this is really the next step that we need to take to grow the company. Both myself and my co-founder Brendan (Farnand), we were the sales people at the beginning of the company. As we grow, we need to get that knowledge of how to sell Knak into some kind of enablement program so that we can train and empower our sellers and our sales team to get out there and sell better than Brendan and I used to. 

“There are thousands (of things) in Brendan’s and my brains that help us be effective sellers. How do you take all of those things and distill them down into things that (new sellers) need to know, and how do you make it simple enough that you don’t have to spend 20 years learning it all? 

“To me, I really feel it’s so critical to do this well because it’s hard to scale a company otherwise. I would say that we’ve been trying to do this now for a while and we’ve been struggling with it. I want to once and for all make this happen, but it’s also a really hard challenge to address. We are looking to bring on a new sales leader. I think it’s really a combination of marketing, sales, and the founders that have to make this work in unison. That’s why it’s top of mind, because we’ve just realized that in order to take the next steps, we need to do this.”

Why Ottawa doesn’t have more large software companies

“(Knak) just hit 100 employees. But we’ve hit this milestone and looking around the city now … I know Assent just hit $100 million (in annual recurring revenue) and that’s awesome, but there’s not a lot of companies who are doing that. Even if you look across Canada, there aren’t many, let alone Ottawa. There aren’t a lot of Shopifys across Canada. So it’s been on my mind, why don’t we have more of them? 

“My hypothesis is that, unlike places in the States — where there are more bigger software companies and you can see different people who have done it — there aren’t a lot of examples. So in Canada, once you grow to a certain size, you sell. There aren’t many role models to look at to say, hey, let’s keep going. Let’s keep making this thing even bigger. I do think it also relates back to capital gains. The country is not really set up to have those huge successes in terms of the tax structure and the policy around it.”

Knak’s office expansion

“When we moved into this building, there was a quarter of our office that was occupied by another tenant. We’re now taking that space over and building it out. It’s top of mind because we’re right in the middle of making a lot of decisions, and also we can hear the construction noise from down the hall. It’s hard to avoid! But we’re really excited about it, that we’re growing and making more space for our employees. 

“There’s going to be some variety in the new space, like standing desks that we don’t have elsewhere. We also really wanted to focus on our dev team. One of the things that I learned when I was at the Meta campus in Silicon Valley is that they really prioritize the developer and engineering spaces, because that’s really at the heart of every software. We wanted to do the same thing and give them an awesome space. I think they’re going from probably the worst space in the office to the best.”

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