TORONTO \u2014 The federal government will set up a $500-million fund to finance Canadian technology firms and may take stakes in some of the companies as part of its updated national AI strategy, The Logic has learned. The plan also includes hundreds of millions of dollars for AI adoption, commercialization, compute and research.<\/p>\n
The new Canadian Tech Growth Fund is designed to \u201cclose the scaleup capital gap facing Canada\u2019s most promising AI companies\u201d and help keep them in the country, according to a version of the strategy obtained by The Logic. It could also take equity in \u201cthe most promising Canadian AI firms.\u201d The document says the government may also use its recently announced<\/a> $25-billion sovereign wealth fund to back \u201cemerging national champions.\u201d <\/p>\n Talking Points<\/p>\n Canada\u2019s new AI strategy includes a new $500-million growth fund to finance and possibly take stakes in scaling AI firms, as well as significant new money for innovation and processing power Ottawa is also planning to add $700 million of new funding to the AI Compute Access Fund, which helps firms pay for the processing power they buy from cloud service providers. The oversubscribed program has so far awarded<\/a> $66 million of its $300-million budget<\/a> to 44 companies, including venture-backed tech firms like Basetwo<\/a>, EarthDaily<\/a> and Vendasta<\/a>.<\/p>\n Canadian small and medium-sized firms currently have \u201cno affordable domestic option\u201d to buy the processing power they need to build and run AI tools, according to the government\u2019s strategy document. As a result, such companies are using foreign cloud platforms, \u201csending Canadian dollars offshore and placing their most sensitive data and intellectual property outside Canadian jurisdiction.\u201d<\/p>\n The strategy, which is expected to be announced Thursday, proposes using BDC\u2019s new LIFT program, a $500-million initiative announced last month, as one of the tools to help Canadian businesses adopt AI. A BDC report<\/a> published Wednesday found that just 30 per cent of Canadian SMEs currently use generative tools, with non-adopters leaving some $150 billion in GDP on the table.\u00a0<\/p>\n BDC\u2019s chief information officer Jean\u2011S\u00e9bastien Charest told The Logic in an interview earlier this week that the LIFT program could help close the chasm between current adoption rates and Ottawa\u2019s goal. Charest said adoption alone, however, isn\u2019t enough to realize the productivity gains AI could create.<\/p>\n \u201cIf you want to really move the needle on getting the full benefits, you need to be intentional,\u201d he said, adding that LIFT is designed to move businesses beyond experimentation and side projects by identifying specific problems where AI can help companies be more productive and competitive.<\/p>\n The strategy also adds $500 million to an AI program run by the seven federal regional development agencies that helps firms pay for work to adopt and commercialize AI. The initiative offers repayable funding of between $125,000 to $5 million, depending on the province and the project.<\/p>\n The AI strategy identifies five \u201cpriority\u201d sectors where the technology can make the most impact, and in which it claims Canada already has scientific, economic and industrial strengths. They include health and life sciences, energy and natural resources, transportation, agriculture, and manufacturing and robotics. The strategy says AI can help drive productivity and efficiency in those industries.\u00a0<\/p>\n Ottawa plans to \u201cprioritize dual-use applications\u201d in its investments, citing its new Defence Industrial Strategy, which aims<\/a> to boost the development and deployment of technology with both military and civilian applications.\u00a0<\/p>\n The CBC first reported<\/a> some details of the AI strategy on Monday, citing a draft version of the document.\u00a0<\/p>\n Taking direct stakes in firms via the new growth fund would mark a change in approach for Ottawa. The federal government has typically provided startups with loan-like financing through support programs like the Strategic Response Fund, or grants via schemes like National Research Council Canada\u2019s popular Industrial Research Assistance Program. Successive federal governments have also tried to increase the amount of money available to startups through venture capital programs to indirectly<\/a> or directly<\/a> seed funds that back tech firms.<\/p>\n On top of the new growth fund, the strategy references the $1.75 billion Ottawa announced in the 2025 budget to draw in more private investment for innovative companies.\u00a0<\/p>\n That is a reference to $1 billion in funding for the government\u2019s flagship venture capital fund, called the Venture and Growth Capital Catalyst Initiative, plus $750 million for \u201cearly growth-stage\u201d funding. Investment industry groups have spent recent months making the case for how that $750 million should be spent, with some saying it should be used at the earliest stages of growth and others at a later stage to help companies scale.<\/p>\n The AI strategy warns of \u201cfunding gaps at all investment stages\u201d among Canadian startups, arguing the gaps could push companies, talent and intellectual property out of the country.<\/p>\n Ottawa is also proposing to expand a long-standing program designed to help universities recruit and retain top AI researchers. It aims to increase the number of AI chairs, which help AI institutes and schools pay for faculty and their labs, from 143 today to nearly 200. The government will also provide $130 million for programming at the three national AI institutes to help commercialize research discoveries.<\/p>\n The program, which is managed by the Canadian Institute for Advanced Research (CIFAR), formed the core of the original national AI strategy, announced<\/a> with $125 million in funding in March 2017. In April 2021, Ottawa extended<\/a> the chairs initiative with another $162.2 million, and added<\/a> $60 million for the national AI institutes for commercialization. Last July, CIFAR and the three national AI institutes proposed<\/a> a $434-million renewal package to expand the research and business support programs and set up a new venture fund.<\/p>\n","protected":false},"excerpt":{"rendered":"TORONTO \u2014 The federal government will set up a $500-million fund to finance Canadian technology firms and may…\n","protected":false},"author":2,"featured_media":73887,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[2],"tags":[439,17,235,2134],"class_list":["post-73886","post","type-post","status-publish","format-standard","has-post-thumbnail","category-canada","tag-artificial-intelligence","tag-canada","tag-economy","tag-tech"],"_links":{"self":[{"href":"https:\/\/www.europesays.com\/canada\/wp-json\/wp\/v2\/posts\/73886","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.europesays.com\/canada\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.europesays.com\/canada\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/canada\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/canada\/wp-json\/wp\/v2\/comments?post=73886"}],"version-history":[{"count":0,"href":"https:\/\/www.europesays.com\/canada\/wp-json\/wp\/v2\/posts\/73886\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/canada\/wp-json\/wp\/v2\/media\/73887"}],"wp:attachment":[{"href":"https:\/\/www.europesays.com\/canada\/wp-json\/wp\/v2\/media?parent=73886"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.europesays.com\/canada\/wp-json\/wp\/v2\/categories?post=73886"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.europesays.com\/canada\/wp-json\/wp\/v2\/tags?post=73886"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}
\nOttawa\u2019s plan also identifies five sectors\u2014health and life sciences, energy and natural resources, transportation, agriculture, and manufacturing and robotics\u2014where the country already has strength, and where AI can improve productivity and efficiency<\/p>\n