Thursday, July 30, 2020

Bringing a unicorn to life

By Natalie Quinlan. This is an excerpt of an article that originally appeared on Waterloo Stories.

Since the age of 11, Marcelo Cortes has been passionate about computers and coding. By 13, he was considered the “resident computer expert” after his parents bought a system for their family-owned store in Brazil.

Throughout the next decade, Cortes fueled his fascination, studying the new field of Information Technology in high school and college (at the discouragement of his parents), and committing to classes that would formally train him in programming.

By 18, Cortes had secured a well-paying job at a big-city consulting firm. He experienced the intricacies of business and imagined himself in his boss’ shoes, but he wasn’t convinced he was ready for the stresses that came with it.

Fast-forward two decades later, with a move to Canada, enrolment at the University of Waterloo and prominent roles with Google and Square under his belt, Cortes is now co-founder and chief technology officer (CTO) at Faire, an online wholesale marketplace for emerging brands and boutique retailers.

In just under three years, his company has reached “unicorn” status — an expression that reflects the rarity of startups reaching billion-dollar valuations. With offices in Kitchener, San Francisco and Salt Lake City, Faire employs more than 200 people, many with University of Waterloo connections.

His impact on the world of business doesn’t stop here. Earlier this year, when COVID-19 was declared a pandemic, Marcelo Cortes was quick to realize the devastating impact it could have on small, local businesses. Cortes and his team responded quickly with an online calculator designed to help these businesses find inefficiencies and better prepare for the future.

Growing a global business, locally

So how did this once small startup amass to a behemoth business in such a short time? For Cortes, it’s his team.

“The people, for sure, are a big part of the equation,” Cortes says. “We put a lot of effort into the team we bring in.”

Cortes understands the importance of what he calls, “experienced DNA from all over the world.” With the University of Waterloo down the road, Faire’s Kitchener-based office is just minutes away from local and international talent. In fact, Cortes estimates that around 80 per cent of Faire’s regional employees are Waterloo alumni or co-op students.

“A big part of remaining in the Waterloo region is because there’s talent here, talent that’s comparable to what you could find in Silicon Valley,” Cortes says. “And if we find talent elsewhere in the world, we can also bring them here.”

It’s taken a combination of talented minds and progressive business leaders to propel Faire from a startup to unicorn — and not every step has been easy either.

Two years after arriving in Canada, Cortes was ready to make Canada his home. He furthered his studies in computer science by enrolling at the University of Waterloo, home to one of the largest mathematics and computing centres in the world.

“It was very hard to get in. Waterloo looked at my marks and they weren’t great, so it didn’t make sense for the University [to accept me],” Cortes says.

But in familiar determination, Cortes pushed forward, reaching out to friends who had attended the University and vouched for his application through letters. The University took note, allowing him a shot at completing entrance exams in math and physics. Cortes aced both and was accepted.

Being so close to local talent landed Cortes in the sights of Google, getting hired as a senior engineer at just 28-years-old. “The first week that I started working there, I called my wife and told her this is like Disneyland for software engineers,” Cortes says. “Anything you could imagine was available to you. But after working there for a while you start to see no company is perfect.”

So, Cortes got to work.

Read the rest of the article on Waterloo Stories.

Q and A with the experts: the economic implications of a second wave

The University of Waterloo has a number of experts available for comment on various aspects of the COVID-19 pandemic.

As we move out of the first wave of COVID-19, there is already concern about how the world will endure a second wave, particularly when it comes to our fragile economy.

We spoke to economics Professor Joel Blit to unpack the economic implications of a second wave of COVID-19.

How fragile is the global economy right now as the world is beginning to emerge from the lockdown forced by COVID-19?

The world remains in an economic crisis and hopes for a full and fast economic recovery are misplaced. Depressed wages and profits, and in many cases increased debt loads, will be a drag on consumer and business spending. Lingering uncertainty over potential new waves of COVID-19 and over the economy will also dampen demand. 

In the face of uncertainty, many firms are unlikely to rehire non-essential workers in the short term. In fact, if history is any guide, they may choose not to rehire them at all, taking this downturn as an opportunity to automate and reorganize operations. Other firms will either downsize or fail altogether, and over time the labour and capital that they release will be reallocated to more productive or better-adapted firms. We are already seeing such a transformation in the retail sector, with Walmart announcing the first fully cashier-less store and market share being reallocated from brick and mortar to online stores.

What would a second wave of COVID-19 mean for global stock markets?

Global stock markets have made perplexingly large recoveries and some are closing in on their pre-crisis all-time highs. As of this writing, the S&P500, TSX Composite, Euronext 100, and Nikkei 225 were within 5.9 per cent, 12.4 per cent, 15.9 per cent, and 7.4 per cent, respectively, of their all-time highs. 

It is somewhat puzzling that stock markets have rebounded so far and so quickly, given that the health crisis is far from over, and that even if there were no future waves of COVID-19, the economy is unlikely to fully recover in the near term. By some measures, the U.S. market is now more overvalued than at any point in history with but three exceptions: Black Tuesday, the dotcom bubble, and prior to COVID. The one explanation for the high valuations might be that governments have made it amply clear that they will go to extreme lengths to support the economy, and that the associated printing of money will inflate assets. 

What would a second wave mean for the Canadian economy?

It is likely that we will see a second wave, perhaps as soon as September. The second wave could be worse than the first in that Canadians are unlikely to be willing or able to make the same sacrifices, and that aside from Montreal, no parts of Canada have developed any significant degree of herd immunity (assuming herd immunity is even possible). 

The extent to which a second wave would hurt the Canadian economy depends largely on two factors. First, it will depend on our degree of preparedness. A prepared Taiwan, for example, did not need to shut down schools or their economy. Second, it will depend on whether our public health agencies and governments adopt a more balanced response where social and economic objectives are also considered.

Joel Blit is an Associate Professor in the Economics department. Professor Blit’s main research interests are in the economics of innovation and economic geography. He studies the role that multi-location firms play in promoting the flow of knowledge across geographical space, the effect that intellectual property rights (patents) have on innovation, and whether skilled immigration can be leveraged to foster innovation. 

Thursday's notes

Here's what’s coming up at the Centre for Career Action (CCA):

• How to survive applying to medical school: Prepare for your activities sketch, August 6, 2:00–3:30 p.m.
• See CCA’s offering of virtual programming online. Students can register on WaterlooWorks.

The Centre for Career Action virtual drop-in advising hours for July are as follows:

• Online résumé, cover letter and interview support, Career consults, and Work search drop-ins running 12:00 to 1:00 p.m., Monday through Friday. PhD student and postdoc drop-ins are running 12:00 to 1:00 p.m. on Tuesdays and Thursdays. Students can book virtual drop-ins on WaterlooWorks.