Canada’s tech ecosystem is evolving—but not always at the pace of its southern neighbor. The United States leads in patent filings, venture capital, and rapid innovation, while Canadian companies often take a more cautious, measured approach. Telus’s Director of Digital Transformation, Moutie, who has spent years observing both markets, breaks down why Canada falls behind in some areas, yet holds unique advantages.
“There are three reasons I can think of,” Moutie explains when asked why Canada lags behind the U.S. in technology innovation and patent filings.
The first is simply the availability of capital. In the U.S., there’s far more investment and alternative funding for innovation, which makes it easier for investors and innovators to flourish. Second, there’s a cultural difference—Canada tends to be more conservative, more risk-averse. Investors, boards, and shareholders want to see cautious, measured steps, whereas the U.S. can feel like the Wild West, with companies willing to take high risks for high rewards. And third, there’s the talent pool.
Canada’s smaller population limits the number of skilled resources, whether native or international, compared to the U.S. This makes scaling innovation a slower process here. That said, Canada offers stability, both for companies and individuals. You may not get exponential rewards, but you gain certainty in employment, investment, and lifestyle. It’s a trade-off, and some people prefer that stability.”
The contrast is clear: U.S. startups raised over $211 billion in VC funding in 2023, compared to Canada’s $7.86 billion in 2024.
Canada’s contrast with the U.S. extends beyond venture capital. Compared to the United States, Canada files significantly fewer technology patents each year. While, according to the Canadian IP Office, Canada receives about 39,000 patent applications annually, with just over 4,000 patents granted, the U.S. Patent and Trademark Office received close to 600,000 applications in 2021, dominating global filings after China.
Canada shows strong inventive specialization in areas like biotechnology, pharmaceuticals, and nanotechnology, but the U.S.’s far larger patent volume reflects its broader technological scale and commercialization capacity. Challenges including a sizable backlog in Canada and fragmented ownership of patents limit Canadian firms’ ability to fully capitalize on their innovations, whereas U.S. companies benefit from a more streamlined system and larger innovation ecosystems.
This contrast further underscores why Moutie points to capital, risk culture, and talent as the key differentiators between the two countries’ tech landscapes.
Yet this contrast can also be a strength. Canadian founders often bootstrap longer and secure VC funding later, allowing them to retain control over their vision and strategy. Moutie notes that this makes companies more resilient in the long run, unlike some U.S. startups, which may cede significant ownership early. Shopify is a prime example of a Canadian company that leveraged patience, focus, and creativity to achieve global scale.
Recent shifts in U.S. immigration policy, such as a $100,000 fee on new H-1B visas, could alter dynamics. Moutie anticipates that many U.S.-based companies may turn to Canada to access skilled talent, creating opportunities—but also challenges.
“You’re going to find a lot more U.S. companies trying to set up shop here and bring the resources they need, because it’s too costly or cumbersome in the States,” he says. “Canada has always attracted skilled resources for that reason, and this trend is going to accelerate. But the government will be cautious—immigration has been a hot topic politically, so programs will likely target specific expertise, like AI or other high-skill sectors, rather than opening the floodgates. Still, this is a significant opportunity for Canada to grow its innovation ecosystem.”
Moutie emphasizes that while technology and talent are important, the human element is often the deciding factor in successful digital transformation. Technical expertise is widely available, but defining the right use cases, understanding customer behavior, and translating innovation into business impact requires creativity, strategic thinking, and empathy.
Leadership hiring, in particular, remains challenging. Many employees, especially in younger generations, are hesitant to move into managerial roles due to stress, work-life balance concerns, or modest financial rewards. Moutie stresses that leadership is not innate—it is a learned skill, requiring emotional intelligence, tact, and the ability to motivate and align teams.
Canada’s position in AI mirrors the early days of the internet, he explains: the country is in the initial phases of adoption, where one or two successful innovations could catalyze momentum for the broader ecosystem. This highlights both the potential upside and the need for strategic investment and bold entrepreneurship.
Ultimately, Canada’s tech story is one of balance. The country offers stability, measured risk, and opportunities for founders to maintain control of their vision. At the same time, gaps in capital, population size, and risk culture mean Canada lags in some metrics compared to the U.S. The future, according to Moutie, depends on how effectively Canada can harness its strengths, nurture talent, and scale innovation from pilot projects to enterprise-wide impact.
“Canada doesn’t need to replicate the U.S.—it can chart its own path, leveraging what makes it unique: stability, control, and a measured, thoughtful approach to the next wave of digital and AI transformation,” Moutie concludes.
With the right mix of leadership, creativity, and strategic investment, Canada’s tech ecosystem may grow more steadily, but it can also achieve meaningful impact—one innovation at a time.
Photo: Justin Tang/Canadian Press
