[Hongwei]

A cause or symptom (I'm not sure about causality here) is that the Business Development Bank of Canada (BDC) directly funds most private Canadian VCs. VCs now have public money as part of their LP base, with some strings attached. Most of these strings (eg. don't waste taxpayer money doing anything unethical or overly negligent) will nudge VCs to be more conservative. Plus, the VCs are guaranteed 20%+ of their 2% carry from BDC taking up that much of every fund and don't need to swing for the fences to make a good income.

[nicholascamera]

I live in Montreal and intend to do a consumer oriented software startup. I would like to better understand what I would be getting into starting up here, vs. applying to YC. Can you suggest resources for understanding Canadian startup landscape, funding etc.?

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

[jariel]

Remember in the SV costs are astronomical, so there's a kind of buy-in threshold necessary which won't make sense for most companies.

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.

[a13n]

Purely anecdotal, but having lived in Canada for 5+ years now, I'd definitely say Canadians tend to be more averse to risk.

[loceng]

Arguably there are less Canadian VCs available locally as well, and therefore they can get away with offering worse conditions.