U.S. investors and technology startups, which have long been centered in California's Silicon Valley, are looking north, some industry experts now say. The pivot to Canada comes as tech companies are increasingly seeking new talent pools and more affordable cities to base their headquarters.
"Obviously, it is convenient," said Jean-Pierre Chessé, the CEO and founder of Bleu Capital, a New York and San Francisco-based investment firm. "It has the same language, there is no time zone difference, and at the same time there is talent there."
From Vancouver to Toronto to Montreal, Chessé said, Canada offers a very high standard of living at a far lower price. "Even if you have a decent salary, you can't have the lifestyle that you can afford living in another place," he said of cities like San Francisco.
Chessé added that the three top sectors emerging in Canada are software, artificial intelligence, and healthcare. mCloud, an artificial intelligence and analytics firm, recently moved its operations from Silicon Valley to Vancouver.
"Over the past several years, the Canadian government has collaborated with academia and private enterprise to nurture a vibrant tech ecosystem whose innovation rivals that of other tech centers around the world, especially in the all-important growth area of AI," Russ McMeekin, mCloud's CEO wrote in an article for Venture Beat.
Money is also moving north.
Clio, a cloud-based legal technology company based outside Vancouver, announced last month that it raised $250 million in a Series D funding round, marking the largest investment in the sector that Canada has ever seen. The company, which said it plans to expand its products and services with the new capital, already has operations in Toronto, Calgary, and multiple offices abroad.
Chessé also noted that Canadian culture — and the government's immigration policies — make it an ideal hub for innovation and technology startups. "I think Canada has always been known for being very welcoming to new talent and new culture," Chessé said, adding that the country can help companies "develop a very strong DNA."