Going to the original startup school, and watching the YC dinner on Justin.TV has re-inforced how important it is to have a local support network. Even if you're not working on the same stuff, there's an energy that's motivating and focusing.
Whether you're planning to apply to YC, planning to start something locally, or already on the way, let's meet and share the energy.
You can contact me at spameatinggrin at gmail dot com.
There's a very healthy ecology of small software companies, and a lot of web companies. There's a bit of defence and aerospace around the airport, but I think Montreal and Ottawa are bigger than Toronto, for that.
Kitchener's not too far away, and they're a major powerhouse with U of Waterloo, and RIM.
ATI just got acquired by AMD, and Alias by Autodesk, so there should be some newly minted angel investors around. I haven't sought financing, so I don't know what that's like. Having been through some private-equity as an employee, the funding definitely seems to be out there.
I think we're building a pretty good tradition, but it's going to take time. The seeds are there though, looking back over the last 20 years (god, I'm getting old!). There's nothing like the unholy Stanford-VC-startup triad yet.
So, I'm not really sure what to say. It's probably harder to get funded here than in CA, and you obviously won't get the same buzz as being YC-funded. On the other hand, if you want to work at a startup or small, hip shop then there're lots of places here.
EDIT If I ever move out of my home-office, I'm going to try to set up next to the U of T comp sci and engineering buildings. That's the nice thing about a down-town campus.