Toronto was recently named the most diverse city in the world, and this status might help to explain the success of companies like Wattpad and other startups that have helped form the city’s cockroach nest.
A study by the BBC says that while Dubai has 83% of its population hailing from abroad, Toronto has a far wider spread of nationalities – 230 in all – so wide that it took one artist a year to find and photograph one person from each of these countries.
Why Diversity Matters, a report by management consulting firm McKinsey & Co. reveals a strong correlation between diversity and financial success: companies in the top quartile for racial and ethnic diversity are 35% more likely to have above average returns.
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Chris Arsenault, managing partner at iNovia Capital, says that companies that prize diversity within their own culture make better hires and have more fully engaged employees.
“As a diverse workforce understands and relates to its customer base, it can also serve to drive innovation, being better equipped to design and develop products and services that meet the needs of a diverse market,” he adds.
WattPad, a Toronto-based community publishing and e-book distribution platform, is following that exact strategy.
“The majority of Wattpad employees can speak a second or third language,” the company’s founder, Allen Lau, explains in a Globe and Mail editorial. “They are world travellers, having lived in 76 different cities around the world. Many are immigrants or first-generation Canadians. The perspective they bring is invaluable.”
WattPad’s initial growth in English only was slow, but when he started hiring country managers who could not only translate language but understand cultural norms, he was able to expand and adapt his product, tailoring it to content creators depending on nationality. This has resulted, for instance, in WattPad stories being adapted for Filipino media.
“I believe that Toronto’s diversity gives me an unfair advantage,” says Lau.
“Local startups are now global on day one,” adds Dr. Sean Wise, Associate Professor of Entrepreneurship at the Ted Rogers School of Management. “Not only does diversity lead to innovation through an exchange of ideas, diversity can allow you to go global.”
For more on the opportunities and challenges facing Toronto as a tech startup ecosystem, read our in-depth analysis, Shopify Takes Vacant Blackberry Throne – And What’s Next for Ontario.
Frequently Asked Questions
How diverse is Toronto compared with other cities?
Toronto was named the most diverse city in the world. A BBC study noted that while Dubai has 83% of its population from abroad, Toronto has a wider spread of nationalities, with 230 in all.
What did McKinsey's Why Diversity Matters report find?
The McKinsey and Co. report found a strong correlation between diversity and financial success. Companies in the top quartile for racial and ethnic diversity were 35% more likely to have above-average returns.
How did diversity help Wattpad grow?
Wattpad's early growth in English only was slow. Once founder Allen Lau hired country managers who understood both language and cultural norms, the company adapted its product for content creators in different countries, leading to stories being adapted for Filipino media.
What did Chris Arsenault say diversity does for companies?
Chris Arsenault of iNovia Capital said companies that prize diversity make better hires and have more engaged employees. A diverse workforce relates to its customers and is better equipped to design products for a diverse market.
Why does Sean Wise say Toronto startups are global from day one?
Dr. Sean Wise of the Ted Rogers School of Management said diversity leads to innovation through an exchange of ideas and also lets startups go global. In a diverse city like Toronto, local startups can reach international markets from the start.