Living/Working December 14, 2020

Living/Working

December 18, 2020

Securities regulator grapples with fintech innovations

Complications arise when new finance technology meets current securities regulations

CEO DH Kim’s company, Vancouver-based Finhaven Capital Inc., has been helped by the Canadian Securities Administrators (CSA) Regulatory Sandbox |  Chung Chow

It’s been two years since DH Kim began making inquiries to securities regulators across Canada, trying to find out how he could develop a digital platform that would connect accredited investors with capital-seeking companies without running afoul of the law.

“The current regulatory framework may not give an opportunity to create new innovations in capital markets,” said the CEO of Vancouver-based Finhaven Capital Inc. “So there are some exceptional leaps that the Canadian securities regulators provide to these fintech companies so that they can try new things in Canada.”

In Finhaven’s case, it was granted relief last month through the Canadian Securities Administrators (CSA) Regulatory Sandbox, which allows fintechs to obtain certain exemptions to securities laws.

That green light has allowed Finhaven to launch a new type of marketplace in six provinces, using blockchain-backed technology that allows accredited investors to invest in digital securities from private companies vetted by Finhaven.

Kim said the relief granted by Canada’s regulatory sandbox is now giving way to “exclusive deals” that would not have been practical otherwise.

For regulators, such exemptions have become necessary as the country tries to balance competition in the capital markets amid advances in technology with the duty to protect investors.

As securities legislation is the domain of provinces, companies are referred through relevant provincial regulators to the CSA’s Sandbox for national consideration, but the relief is ultimately granted at the provincial level.

That falls to the BC Securities Commission (BCSC) in cases dealing with Vancouver-based fintech companies or else financial companies moving into the realm of fintech.

The BCSC itself launched its own Fintech and Innovation Team (FIT) in early 2017 to handle the increasing number of inquiries coming in from tech entrepreneurs tapping new innovations like blockchain and moving into the domain of finance.

“The challenge out of the gate for securities regulators was just making sure that we had a complete understanding of the technology, and how it works and the risk, so that we could appropriately come to the right landing point on balancing investor protection and efficient capital markets,” said Mark Wang, the BCSC’s director of capital markets regulation.

While the FIT team has been offering guidance to fintech companies to ensure they don’t violate regulations, they’ve also been engaging with B.C. businesses proactively to ensure technology being developed does not land them in hot water with regulators.

While COVID-19 has disrupted some of that outreach, regulators have also been pursuing virtual events to get the word out.

And as tech entrepreneurs reach out to the BCSC to ensure they’re not running afoul of securities legislation or to get relief through the regulatory sandbox, FIT has been going to fintech experts and tapping consultants for evaluations of technology or asking for demonstrations of fintech platforms to gain a better understanding of the technology.

“I have no hesitation in going out to a particular industry stakeholder, sounding dumb and asking very dumb questions if that helps us as a regulator to understand exactly what’s happening with a particular innovation or particular business model,” said Zach Masum, manager of legal services at the BCSC’s division of capital markets regulation.

“One of the things that we’ve done here at BCSC over the last few years is that we’ve really developed some good in-house expertise with respect to the different types of fintech that we’re seeing.”

This year the regulator also launched a 17-member advisory forum composed of industry experts to advise FIT on trends, risks and securities laws affecting fintech.

“There’s been a much better awareness of the fact that many of these [business] models incorporate securities law considerations. Part of that is just the continuing evolution and maturity of the fintech industry as a whole. I think it’s matured quite a bit in simply the last three-and-a-half years,” Masum said. “So just the fact that something is in a sandbox does not mean that there is lighter investor protection, necessarily, and that’s definitely not the case with the way our sandbox is structured now in Canada.” •

 
Leading

No free rides left on a sustainable business journalism journey

I want to use this column as a different form of communication with our readers, subscribers and advertisers. The end of a year is an opportunity to take stock. Bear with mine.

I’ve held a number of challenging jobs at a number of challenging times – running CTV News on 9/11, hosting lots of live CBC Newsworld shows in the earlier Gulf War, helping to start the National Post with the odds stacked against us, even running for Vancouver mayor against all likelihood. But if my situation is anything like yours, we can find consensus about the coronavirus as unlike anything we’ve confronted. Even after four decades in journalism, even after BIV had built its business over three decades, most everything felt like sweating through an internship at a startup in a mercurial market. My bosses chose quite the year to make me publisher, but like a lot of you, I actually like my job more than I did pre-pandemic.

We had to learn vast amounts of science and struggle with vast amounts of economics. We turned the words pivot and resilience into clichés. Those of us on the fence about it decided we could proceed with swearing about the circumstances.

Our relationships swivelled.

There were plenty of clients who feared for their plights and had to change their plans with us. We didn’t hold anyone to earlier commitments because we didn’t feel it was fair in this environment. The context of our lives and livelihoods had been altered, so best-laid plans became waylaid plans. It came at a significant cost to us, just as the grand disruption did for many others.

There were also clients who feared for our plight and either stayed with their arrangements or surfaced with offers of help. We were particularly grateful, for instance, when we could (ahem) pivot most of our 30-plus in-person events into a combination of video podcasts and print and digital advertising. It meant that, with people at home, they had a regular supply of expert business content. We had been podcasting for years, but those podcasts took on new importance in the pandemic in offering insights and gauges on how our economy fared.

We had to recognize that, for some, we would lose and might never regain business. We also expect some will try to forge their own audience relationships and either move out of advertising or choose other vehicles to market themselves. Our natural bias is to note, with evidence, that we are the best way to reach decision-makers each day in this market. What we do isn’t done by others, nor is our audience reached by others, and I can only hope that in time that will become more obvious.

Which leads into another obvious area that has become much more of an imperative in the months and years ahead if we are to get not just through the pandemic but also through the next number of decades. Our trusted and valued journalism cannot sustain, much less develop, if it is consumed freely online.

We are unusual as a business journalism organization, in that all but a very slight amount of our journalism (our weekly lists) eventually finds its way on to our website as free content. We don’t ask for funds or, for that matter, even information about you in order to provide it. This isn’t the case almost anywhere else in business journalism.

Having been around this free-versus-paid debate in journalism for about a quarter-century now, it bears reminding that decisions to reach the widest audience without any kind of barrier were made with the expectation that advertising revenue would support the model. In many cases, it can quite well; in ours, not so well.

Without burdening you with details, our print and digital publications each provide different platforms and attract different audiences. We wouldn’t want to lose either, and we know you wouldn’t. While we need to change this to bring more subscription revenue into BIV, it would also be unfair to try to migrate only what we have been giving freely into a for-payment model. So, at year’s end, a bit of a heads-up: Before long we’ll be bringing forward a combination of gated and limited online access (you’ll be asked to register), an introductory subscription offer, and a loyalty program that will offer you additional benefits with businesses in our market. We’re at work on it now. Many of you provided direct support to us during this time, and you aren’t forgotten – you’ll be getting a break on the new initiative.

Our aim out of this is to improve our service to the community, uncover stories that matter to our audience, and we will best do this with your support.

Stay well and safe. Let’s not have this happen again, right? •

Kirk LaPointe is publisher and editor-in-chief of BIV and vice-president, editorial, of Glacier Media

 

 
Spending

'Scuba Claus' is coming to the Vancouver Aquarium for a virtual holiday show

Santa is leaving the reindeers at home in the North Pole for this particular excursion

"Scuba Claus" is diving back into the Vancouver Aquarium's waters this holiday season | Photo: Submitted

Santa might be most at home in the snow that blankets the North Pole, but that doesn't mean the big guy can't enjoy a swim from time-to-time. 

Santa Claus—or Scuba Claus, rather—is returning to the Vancouver Aquarium on Sunday, Dec. 20 for a virtual holiday show that will see Santa get up close and personal with some of the local Aquarium’s most beloved animals.

With holiday events and gatherings on hold in accordance with B.C.'s current COVID-19 health orders, the Aquarium's iconic holiday tradition is going virtual this year. That means kids of all ages will be able to help save Christmas by diving underwater alongside Scuba Claus in search of the missing key to Santa’s toy cupboard—without even having to leave their couch. 

During the approximately 30-minute show, the at-home audience will visit with aquatic friends like the Vancouver Aquarium’s African penguins, a gentle sea lion, and Joey, the famous rescued sea otter, to name just a few. 

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A post shared by Vancouver Aquarium (@vanaqua)

Those who tune in for the premiere, set to take place at 11 a.m. on Sunday, will also be treated to a live chat with Vancouver Aquarium staff, as well as the chance to win some pretty sweet prizes from the Aquarium's Gift Shop.

This new virtual format of the Vancouver Aquarium’s beloved holiday show has been produced in collaboration with students and faculty of BCIT’s Television and Video Production Program, Aquarium staff explained in a news release. The students "generously volunteered their time and expertise to support the Aquarium and spread joy this holiday season," it reads. 

Tickets to the virtual event costs $9.99 per household, with profits going toward the Vancouver Aquarium and its animals. Head to the Aquarium's website for more details. 

Vancouver Is Awesome

 

 
Spending

Dine Out Vancouver returns in early 2021, featuring 31 days of special menus and pricing

Hundreds of Metro Vancouver restaurants will take part in Dine Out's longest festival run ever

Dine Out Vancouver 2021 will feature special menus and pricing for dining in or take-out for 31 days in February and March | Photo: Getty Images

Restaurants in Vancouver have been nimbly adapting as needed to a year of unprecedented changes thanks to the coronavirus (COVID-19) pandemic and public health orders in B.C. Now, as 2020 comes to a close, locals have a familiar food event to look forward to in the new year, as Dine Out Vancouver has confirmed it will return in 2021.

For its 19th year, the Dine Out Vancouver Festival (DOVF) will put on its longest run ever. Spanning 31 days, from February 5 to March 7, 2021, DOVF will offer special menus from local chefs and socially distanced gastronomic experiences, all of which will adhere to any public health orders in place at the time to prevent the spread of COVID-19 in the province. 

Over 300 restaurants were on board at the start of 2020 when Dine Out Vancouver was on, and for 2021, diners can expect hundreds of restaurants across the Metro Vancouver region to take part.

This summer, to encourage diners to support Vancouver restaurants and their permanent or temporary patios, DOVF ran a well-received month-long Dine OutSide Vancouver, that echoed the core event's offering of special menus and pricing. Much like in the summer, we can expect Dine Out's winter 2021 edition to include a range of special take-out only options for those who wish to take their meals to go instead of dining in. 

Menus will be announced and reservations will open on January 25, 2021. 

Vancouver Is Awesome

 

 
Spending

Whistler skier wins international GoPro Challenge

Evan Macalister’s backflip is featured in new video—to the tune of $20,000

Evan Macalister in the midst of a flip, captured by his GoPro HERO9 Black | Photo: Submitted

Evan Macalister woke up on Tuesday morning, had breakfast, discovered he won $20,000 through the GoPro Million Dollar Challenge and headed out on his commute to work.

“I watched the video, saw my clip and was like, ‘Whoa, that’s pretty wild. I guess I’ll head off to work now,’” he says. “I was trying to process it myself the whole day.”

Earlier in the season, he purchased the newly released HERO9 Black, in part with the goal of entering the third year of the contest. GoPro launched the new product and the kicked off the challenge in September, encouraging people from around the world to share their best clips in 80 days.

The only parameter was it needed to be shot on a HERO9 Black. 

For its part, GoPro is interested in seeing what customers can do with the new cameras, GoPro founder and CEO Nicholas Woodman said, in a release.

“It’s also our chance to give back to the GoPro community in a big way,” he says. “Our community powers our brand and we love celebrating their creativity with the Million Dollar Challenge video and the significant cash prizes that help them pursue their passions even further.”

Having grown up in Whistler, Macalister knew exactly what he wanted to do for his submission.

“Mine was taken of me skiing up on Whistler Blackcomb in the Terrain Park,” he says. “I was able to mount the GoPro camera to my pole and I went off the jump and did a backflip. What made it stand out was one of the new functions of the GoPro is this horizon-levelling feature which keeps the camera shooting at the same angle. When you flip, it doesn’t flip at all. So everything else flips instead.”

After a full day filming laps at the park, he went home and submitted three of the best shots. “On a follow-up email they wanted me to send everything I had from that day,” he says.

To that end, GoPro says it went through 29,000 submissions from over 125 countries—that’s 250 hours of videos to review. Then they picked 56 people to share a $1 million USD purse evenly.

That equals $17,857 USD, or close to $20,000 Canadian.

What is Macalister going to do with his prize money? “There’s ideas running through my head, but I can’t really pinpoint anything at the moment,” he says.

The final video is comprised of split-second clips of everything from action sports like sky diving, skateboarding, waterskiing, biking, and surfing to everyday scenes like a jubilant little girl and a live-action painting of mountains.

“I watched it multiple times today,” Macalister says. “It’s so wild. I almost feel like my clip doesn’t stand up to some of the stuff in there. It’s unreal. Some of the angles and whatever they strap the GoPro to to get those shots, it’s otherworldly for sure.”

Pique Newsmagazine

 
Exploring

What are we reading? December 17, 2020

Getty Images

Mark Falkenberg, deputy managing editor:

Vancouver writer Kate Black explores the pandemic-driven collision of work and life, and how it can sour us on the look and feel of our homes. “At best, a well-organized home is a sign of the times, an idealized cure for the anxieties that ail us,” Black writes “At worst, it’s a bad cure for a bad world.” – The Walrus

https://thewalrus.ca/livingrooms-what-diy-couldnt-do-for-me/

 

In an interview, former George W. Bush lawyer Richard Painter warns that Trump’s bid to overturn the U.S. election results might have succeeded had he been a little brighter and a little less catastrophically incompetent:

“The warning to the United States, is that we better get our act together pretty damn fast…. The next person who has Trump’s aspirations to power may be a lot shrewder, more manipulative and therefore more effective. – Salon

https://www.salon.com/2020/12/17/richard-painter-trump-is-an-incompetent-dictator--a-shrewder-plot-might-have-worked/


 

Timothy Renshaw, managing editor:

Anybody for some good news coming out of 2020? Believe it or not, it has not been all disease, depression, recession, lockdowns, cutbacks and political lunacy and larceny over the past 12 months. Mostly but not all. Here are a couple of glimmers of hope in the darkness. – The Smithsonian and Discover Wildlife

https://www.smithsonianmag.com/smithsonian-institution/these-conservation-storeis-prove-2020-was-not-all-bad-news-180976512/

https://www.discoverwildlife.com/animal-facts/wildlife-success-stories/

 

And: electricity and energy market insights U.K.-style. – U.K. Energy Research Centre

https://ukerc.ac.uk/news/the-price-of-power-electricity-markets-in-the-energy-white-paper/

 

Glen Korstrom, reporter:

Sometimes it is a challenge to get a handle on what something is worth. This former Forbes reporter remembers a time in 2013 when she was tasked with an assignment to live for a week using nothing but Bitcoin. Struggles ensued as few businesses accepted the novel currency. At the end of the week, she had excess Bitcoin and found a restaurant owner willing to take it in exchange for a lavish dinner she hosted for people who were in Internet groups with her. The cost then: $957. Now, that currency would be worth in the $200,000 ballpark. It’s an engaging read at a time when investors are similarly struggling with how to value technology, electric-vehicle and other companies. – New York Times

https://www.nytimes.com/2020/12/16/style/bitcoin.html?referrer=masthead