In a bold rallying call that resonates across Canada’s burgeoning technology landscape, AI company Cohere is challenging the long-established exodus of Canadian tech talent and companies to the United States. At a time when the familiar narrative of Canadian startups relocating south has become almost expected, Cohere’s stance represents a significant departure from convention—and potentially a turning point for the nation’s innovation economy.
“The old playbook says you need to go to the Valley to succeed. We’re writing a new one,” stated Aidan Gomez, CEO and co-founder of Cohere, during an industry conference in Toronto last week. “Canada has the talent, the research capabilities, and increasingly, the capital to build world-class technology companies right here at home.”
Cohere, valued at approximately $2.2 billion after its recent funding round, has become a powerful voice advocating for domestic tech growth. Unlike many predecessors who relocated operations to Silicon Valley or other American tech hubs, the Toronto-based AI company has maintained its headquarters in Canada while establishing a global presence.
This determination to remain rooted in Canadian soil comes against a challenging backdrop. According to data from the Council of Canadian Innovators, nearly 40% of Canadian tech startups that achieve initial success eventually relocate their headquarters or significant operations to the United States, citing better access to venture capital, larger markets, and deeper talent pools.
However, industry experts suggest the landscape is evolving. “We’re seeing a maturation of Canada’s tech ecosystem,” explains Dr. Sarah Kaplan, director of the Institute for Gender and the Economy at the University of Toronto’s Rotman School of Management. “The combination of government initiatives, world-class research institutions, and success stories like Shopify and now Cohere are creating a more hospitable environment for companies to stay and grow.”
The federal government has taken notice of this potential shift. Innovation Minister François-Philippe Champagne recently announced a $250 million expansion to the Strategic Innovation Fund specifically targeting AI and quantum computing ventures. “Canada isn’t just a place where great ideas are born—we want it to be where they reach their full potential,” Champagne noted at the funding announcement.
Cohere’s approach also reflects a growing recognition of Canada’s strategic advantages in the AI field. The country’s universities produce a disproportionate share of the world’s leading AI researchers, and cities like Toronto, Montreal, and Edmonton have developed specialized expertise clusters that rival any global tech center.
“What’s happening now is a recognition that you can build globally competitive companies with Canadian headquarters,” says Jordan Jacobs, managing partner at Radical Ventures, an early investor in Cohere. “The computational infrastructure, regulatory environment, and talent pipeline have all improved dramatically in the past five years.”
Critics argue that structural challenges remain, particularly regarding the availability of late-stage growth capital and executive talent with scale-up experience. Canadian venture capital investments, while growing, still lag significantly behind American counterparts on a per capita basis.
Nevertheless, Cohere’s success and vocal commitment to Canadian growth suggest a potential inflection point. The company’s advanced language models are competing directly with products from OpenAI, Anthropic, and Google, demonstrating that geographic location need not limit technological ambition.
As Canadian technology firms face increasing global competition and economic uncertainty, the question remains: Will Cohere’s commitment to domestic growth become the new template for success, or will the gravitational pull of larger markets continue to draw Canadian innovation southward?
