The Great Canadian Founder Drain: What Are We Missing?
Why Canadian VCs believe there are plenty of great founders — while many of the best are already building their futures elsewhere.
TLDR; Canada produces incredible founders, but many of the best leave before they ever hit a local VC’s radar. U.S. firms like Contrary and programs like The Residency are actively pulling top Canadian talent south, offering them better capital, networks, and opportunities. Meanwhile, Canada’s startup ecosystem is running a decade-old playbook, failing to keep up with what young, high-agency builders want. The result? Canadian VCs see great founders — but only a fraction of the total potential. If we don’t rethink how we fund, support, and inspire our best talent, we’ll keep asking: how many more great companies could have been built here?
There’s a contradiction at the heart of the Canadian startup ecosystem: VCs say there’s no shortage of great founders here, yet we know many of our most ambitious entrepreneurs head south.
So, how can both things be true? The answer lies in what Canadian investors see — and what they don’t.
Not All the Best Leave — But Many Do
Some of Canada’s best founders stay and build world-class companies here. Shopify, ApplyBoard, and Clearpath prove that billion-dollar companies can scale from Canada. Others leave but maintain deep ties, helping the next generation navigate both ecosystems.
Then there’s a third group — one that I believe is bigger than the other two combined. These are the ones who leave so early that they remain total unknowns in Canada, or are just “that kid who asked smart questions” before they disappear into the U.S. ecosystem. They don’t just raise capital there; they build their companies, networks, and careers in an environment designed for speed, risk-taking, and aggressive scaling.
Their Canadian identity becomes part of their backstory rather than their reality.
The Quiet Competition for Canada’s Top Talent
This isn’t happening by accident. U.S. firms and programs are actively identifying and pulling high-potential Canadian talent into their ecosystems before they appear on a local investor’s radar.
- Contrary funds students in Canada, using early capital as a recruitment tool to bring them into the U.S. startup scene. And they’re not alone — many U.S. VCs are doing the same.
- Buildspace became a top destination for students looking for high-agency, high-velocity entrepreneurship — something they weren’t finding at home. Recently shut down.
- The Residency is now capturing the imagination of Canada’s most creative builders, giving them a direct path to top-tier global networks.
- Emergent Ventures offers a grant with over a dozen Waterloo students currently participating.
- YC recently announced a summer fellows grant.
These programs don’t just offer funding; they offer access — to the kinds of mentors, investors, and communities that accelerate careers. And they have far more capital behind them than anything in Canada. The list of things offered to Canadian talent in the US keeps growing!
Meanwhile, most Canadian organizations and institutions are still running a playbook from a decade ago. That’s a problem. Young builders today don’t just want money — they want a system that pushes them further, faster. And if they can’t find it here, they will find it elsewhere.
What VCs See vs. What They Don’t
Canadian VCs are backing great companies. But they’re only seeing a fraction of the total potential — likely not even half.
By the time top-tier founders raise serious capital, they’re already part of a global market. U.S. investors have built relationships with them early, offered them better terms, and connected them to networks that Canadian firms struggle to match.
It’s not that Canadian VCs aren’t doing their job — it’s that they’re competing for talent that has already left the building.
What If We’re Missing More Than We Realize?
The real issue isn’t just that founders and builders leave — it’s that we don’t even know how many we’ve lost before they had the chance to build here.
We don’t have data to measure exactly how many would have stayed if the right opportunities were available. But instead of debating numbers and pointing to outliers, we should be asking:
- What if hundreds of high-potential founders never even consider Canada as the place to build?
- What if the next generation is forming their networks in the U.S. before we even notice them?
- What if we’re optimizing for “good” founders instead of “great” ones?
Because most of the ecosystem is looking at data to justify funding, they aren’t looking at the future. They aren’t taking risks. They are unable to re-invest in success and benefit from great results.
How Do We Change This?
Instead of just focusing on the founders we do see, we need to think bigger: how do we create an ecosystem where more of them stay, grow, and scale from here?
That doesn’t mean shutting down global opportunities — international networks are a strength. But it does mean rethinking:
- How we fund ambition. Are we taking big enough bets, or are we defaulting to safer, incremental plays?
- How we build networks. Are our best young builders finding high-calibre mentorship here, or do they have to leave to get it?
- How we tell our own success stories. Do young entrepreneurs see Canada as a launchpad for world-changing companies, or just a stepping stone?
If we don’t address this, we’ll keep seeing great companies emerge in Canada — but we’ll always be left wondering: how many more could there have been?
Are you that ambitious person? You should join Builders Club.
