The salary of MaRS’s CEO was $533,113 in 2010, according to the Ontario government’s public salary disclosure report, which can be seen at http://www.fin.gov.on.ca/en/publications/salarydisclosure/2011/otherp11.html
According to a consultant there, who emailed me anonymously: “MARS is covered by the Province’s salary freeze guidelines. They did this by jamming all the increases through a month before the guidelines went into effect in April 2010 (they joke about it).”
Meanwhile a Canadian site like Sprouter.com is shutting down, though it did more to promote Canadian startups (the majority of the startups featured in their popular newsletter were from here) in North America than MaRS ever did.
Beside the CEO, another 20 MaRS employees are listed as making over $100K in the disclosure, compared to 15 in 2009. The total number of full-time employees in 2009 was only fifty one, as per the nonprofit disclosure (number of employees on this page). The public disclosure for 2010 has not been published yet. The second highest salary is that of the Vice President, Real Estate, at $277K per year.
Last week, MaRS announced a real estate expansion that apparently will see it collect a loan of $230 million from the province. Beside the fact that the taxpayer is guaranteeing that loan and possibly subsidizing it (the interest rate was not mentioned), the whole project will cost $344 million and the rest of the funding was not specified. Although described as a public-private partnership, no private contribution has been announced. Public subsidies may cover the difference.
In spite of receiving government funding for virtually all of the capital to acquire the current buildings, and collecting rents from companies, MaRS still requires millions of dollars in subsidies from the province today. As of 2009, the organization had collected over $140M in subsidies, including $9.5M in 2009 (from the nonprofit disclosure, line 4550).
A look at tenants from existing buildings shows a number of large corporations, evidently seeking to benefit from the proximity with the hub. By locating there, new companies also get prime access to all the grants that MaRS administers, over companies who do not.
Most of those grants require working with the hub’s advisors, many of whom also hold private consulting companies on the side.
MaRS’s model is in many ways comparable to the ones at eHealth Ontario’s, Ontario Lottery & Gaming Corporation, or Toronto Community Housing just before they had public scandals: lots of public money flowing in, high salaries for the leadership, little public disclosure or government oversight.
In 2010, I wrote a series of blog post detailing a number of issues with the institution, starting with the excessive salary of the CEO. According to current and former employees, the posts created lots of angst within MaRS senior management. Yet close to no media follow-up. A Financial Post article by Adam McDowell, called “Discovering life at MaRS”, mentioned the criticism in passing, without digging in any of the facts. The article has now been taken down, although strangely other articles published the same day are still up (the Financial Post did not respond to request for comments – Article’s cache is still up for now on Google). Other newspapers never investigated the issue in spite of requests, and last week republished the MaRS press release without raising any question about the financing or the ROI of the operation. Startup North, a popular site for Canadian entrepreneurs, initially criticized the salary of MaRS CEO on Twitter, but backed out of all criticism since then in spite of promising a blog post on the topic. Criticizing doesn’t pay or make it any easier to get invited to MaRS events.
My motivation for writing this? Looking like a crazy conspiracy theorist? No thank you. I’d rather someone else publish this, but I’ve learnt no one else will. I believe in transparency, and as a Liberal at heart I believe the party would fare better with better oversight. As a Canadian, I believe the same is true for our country. I do not benefit financially from it, far from it: my Canadian revenue today is less than 25% what it was before publishing my posts, with a lot of people distancing themselves to not be associated with a MaRS critic. But the money we make is not a perfect indicator of our worth as individual. Right Mrs. CEO?