PointClickCare CEO Dave Wessinger says the probability of the company moving to the U.S. is low and a 'worst case scenario' plan that would come into effect only if needed to protect the interests of the business.Fred Lum/The Globe and Mail
One of Canada’s largest homegrown technology companies, PointClickCare Technologies Inc., has drawn up a contingency plan to relocate to the United States if the trade war between the two countries escalates to the point that it harms its business.
The 31-year-company’s co-founders and leaders, chief executive officer Dave Wessinger and brother Mike, the executive chairman, are unabashed champions of Canada’s technology sector, overseeing a digital records software giant that sells to more than 30,000 nursing homes, retirement facilities and home health care agencies in the U.S.
It’s one of the largest employers in Canadian technology, with roughly 1,500 people in Canada and another 1,000 in the U.S., and generates more than US$200-million in operating profit and US$900-million in revenue. PointClickCare generates tens of millions of dollars in corporate taxes.
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But if it was forced to pick between Canada and the U.S. for its home base, that country would be the U.S., Dave Wessinger said in an interview. That’s a decision he’s been worried the company may have to make, ever since trade tensions between the two countries boiled over last year.
“In effective enterprise risk management, you look at what could possibly happen, and there is a situation where we become very focused on a Buy Canada initiative such that the Americans counter with a Buy American response and we’re caught in the middle,” he said.
The U.S. market accounts for 97 per cent of the Mississauga company’s revenues and “is critical for us to drive the growth we’ve seen,” he said. “Anything that gets in the way of that would challenge our business. That hasn’t been the case to date, but it just takes one pen stroke, one conversation, one retaliatory move. I just have to be prepared for anything that could happen.”
Mr. Wessinger stressed that’s not something the company had ever considered before last year, nor something he or his brother wanted to do. The company also has outside shareholders “that we need to make sure we’re delivering a return to.”
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Canadian trade lawyer Barry Appleton said in an interview “it’s not surprising there are Canadian companies trying to figure out if they should stay in Canada” given the prevailing uncertainty in the U.S.-Canada economic and political relationship since the second election of U.S. President Donald Trump in 2024, which was followed by his imposition of sweeping tariffs on dozens of countries including Canada.
The state of that relationship will be tested when a joint review begins July 1 into the Canada-U.S.-Mexico Agreement on trade, which came into effect during the first Trump administration. Mr. Appleton said he has talked to many companies that have discussed “usually with great detail, the move from Canada to the U.S. as an option.”
Such a relocation, Mr. Wessinger said, would involve PointClickCare reassigning contracts south of the border and moving its headquarters and key functions there. Employment in Canada would fall off over time, “and we become an American company with American employees,” he said.
Mr. Wessinger said the probability of such a move was low and a “worst case scenario” plan that would come into effect only if needed to protect the interests of the business.
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Dana O’Born, chief strategy officer with the Council of Canadian Innovators, an advocacy group for domestically-based technology companies, said “this should serve as a stark warning sign for the federal government. If our best, brightest and most successful entrepreneurs are running the numbers to flip the switch and relocate to the U.S., we need to pull all the stops to make sure this does not happen.”
Software and other digital products transmitted electronically are exempt from customs, duties, fees or other charges related to trade between Canada and the U.S. But Mr. Trump has eyed trade of digital goods for retaliatory action in the past. One of the earliest moves by the Canadian government after the election of Prime Minister Mark Carney last year was to abandon digital services tax that affected U.S. tech giants here.
Mr. Appleton said just because software hasn’t been subject to tariffs “that doesn’t mean it won’t be. There’s nothing to prevent services from having a tariff. We’re not in a game of rules any more.”
Ottawa-based intellectual property lawyer Natalie Raffoul said “if these trade negotiations don’t go well and we have Buy American provisions, these companies are going to have to flip” to U.S. domiciles. “It’s extreme, but we’re dealing with tough times, and what concessions are we going to make in exchange?”
Some observers have raised concerns that the domestic tech sector has been an afterthought for the Carney government, which struck an advisory committee for Canada-U.S. economic relations last month that included no representatives from the digital sector among its initial 24 members (defence technology startup founder Eliot Pence was later added). A report last fall by Canadian venture capital firm Leaders Fund showed Canadian-founded companies were increasingly relocating or starting up elsewhere.
Report co-author Gideon Hayden, who testified before the House of Commons standing committee on industry and technology about the study’s findings, said that despite the troubling trends it uncovered, solving the issue “has not been a top priority” for government.
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Mr. Wessinger said the Carney government’s focus on diversifying trade and fortifying sovereignty across the economy could have “cascading impacts that I don’t think everyone realizes.” That includes the fact many Canadian tech companies rely heavily on U.S. markets. “Should people decide that our sovereignty is that important when in fact we’re so intertwined in business with the U.S. is not an easy black-or-white decision.”
John Fragos, press secretary for federal Finance Minister François-Philippe Champagne, said in an e-mail: “More work remains to be done to support sectors and workers in the face of an unpredictable trade environment.” He added the government “is making meaningful progress” with economic measures introduced since it came to power last year.
Ms. O’Born said: “We cannot afford to lose the companies, talent, and innovation capacity that are essential to our long-term productivity and prosperity. I really hope we’re not looking back on this in a year and saying we had our chance and we blew it.”
With a report from Marieke Walsh