-> so basically, Canadian "venture" capital. They don't even want to talk to you unless profitability is there or within a few months. So, basically, it distills to a barely riskier than usual bank loan, except you pay the loan with equity.
Perceived Pros:
- Many STEM grads
- Gaming and AI industry, 2+ top AI schools
- Relatively little competition for engineering talent compared to SV
- Many engineers who are barred entry to US based on country of origin
- Easier work visas (to be confirmed)
- Free healthcare and other social services, and less violence
Perceived Cons:
- Cultural lack of ambition, entrepreneurial dreaming.
- Excessive reliance on government subsidy (the government is the customer)
- Risk averse VC
- Shallow bench of experienced operators to mentor, invest, and manage
- Brain drain to SV of best talent
- Higher taxes
Shopify is a perfect company for Canada - they are not making 'tech for other techies' and don't require all the best devs in the world. It took a while to get going, so costs needed to be lower. They can make some income early on, thus 'proving the model'.
There is a reason that the nations top social network started at Harvard, which has an elite status among young people. There's a reason that Snap was started by an attractive young man from Cali, from a the top school in Cali. Glossier, a 'makeup company' is actually, truly a 'social network', and there's a reason it was founded by an ex-model/reality TV star with deep connections in LA/NYC.
On the technical side, there's a reason that certain companies really need to be in the Valley as well.
So if your business needs to be in the Valley, it might make sense to do that, but if it's a 2cnd-tier kind of thing, not something the FAANGS would ever look at, and doesn't require the best technical talent in the world, than you can do it other places.
Montreal a tier 2 cities, Ottawa/Vancouver, not really tier 2, Toronto is probably a solid tier 2. FYI that is actually not bad considering tons of American cities are not tier 2 either. Chicago, Toronto's 'twin' really might not even be Tier 2, there is a weird lack of entrepreneurial activity there for its relative size and power.
Montreal has cheap prices, decent AI grads, stable economy, supportive government, weak VC but the top could of firms are fine places to go for smaller up to round A, and if your business fits well into Quebec's strategy, following rounds can be supported by Desjardins and nationalist players.
Also, Porn.
I love this. I wish it were a thing, "The Canadian Model".
It doesn't do a great job of serving the country's social needs, and it also doesn't do a great job of producing competitive businesses.
There's a fair number of public funds that get funneled into unproductive firms through things like innovation grants, and there's a lot of protectionism for incompetent incumbents. All of this seems to enrich a small class of elites, at the expense of the public purse. Most Canadians just shrug their shoulders at all this, and move on with life.
On the other hand - Canadian business expenses are still quite high, but quite a bit lower than US business expenses. Healthcare and cost of living are huge factors in labour costs.
If they were productive firms, they wouldn't need government money. This is why free markets work better, because free markets allocate resources to the most productive uses.
You misspelled profitable.