Plus: Check your SR&ED history for a potential post-holiday windfall.
What a week to close out the year!
In the previous edition of this newsletter, I noted open speculation that another shoe might drop following the last-minute pre-announcement of major components of the Fall Economic Statement one business day before it was due. Few expected that shoe might be the federal government in its entirety.
The resultant fire drill, which became international news, delayed the launch of our look back at the defining Canadian tech stories of 2024, but you can now read thoughtful pieces from the team on a year of executive turnover, public companies fleeing to private markets, and Canada struggling to find its place in the global AI race.
With both an election and a new Liberal Party leader expected to come in the new year, it’s likely that the legislation-dependent components of the FES will never see the light of day. Last week, I promised you a deep dive into the federal government’s ongoing inability to deliver effective innovation policy, but you’ll have to wait until Monday for it. Forgive me if I wanted just one more day to ensure no additional shoes dropped before the holidays.
Besides, we’ll collect everything (plus a few more goodies) in our final newsletter edition of 2024 next week, so we can all come back refreshed and informed in 2025. On behalf of the BetaKit team, I hope you have a wonderful holiday break.
Douglas Soltys
Editor-in-chief
What lies ahead for global markets in 2025?
As the macro landscape continues to evolve and new market dynamics unfold, corporates and investors must understand the trends driving capital allocation, sector shifts, and emerging opportunities to position themselves for success. There is growing optimism in the market, but critical questions remain about the impact of tariffs and trade policies, long-term risks to the USD, and how to interpret the economic narratives and structural shifts likely to define the immediate future.
TOP STORIES OF THE WEEK
Faltering Feds table Fall Economic Statement following Minister Freeland’s shock resignation
The Government of Canada tabled its Fall Economic Statement (FES) on a day of political chaos and uncertainty triggered by Finance Minister Chrystia Freeland’s surprise resignation.
While Freeland announced much of the FES’s tech commitments last Friday, there were a few additions that shouldn’t be overlooked, including measures to boost AI adoption, federal procurement reform, funding for Black entrepreneurs, and a capital gains update.
There FES also unveiled new details of a proposed open banking framework, confirming the suspicions of many observers in the Canadian FinTech space that progress toward a consumer-driven financial system would be stalled yet again.
The turmoil stemming from Freeland’s exit prompted members of the Conservatives, NDP, Bloc Québécois, as well as multiple Liberal MPs, to call for Prime Minister Justin Trudeau’s resignation.
Following Friday’s cabinet shuffle, NDP leader Jagmeet Singh released a statement announcing his intention to file a non-confidence motion when the House of Commons sits again on Jan. 27, 2025. Without the NDP’s support, an election will almost certainly happen in the spring, leaving the Liberal proposals in limbo until after the vote.
Check your SR&ED history: Canadian tech companies could be in for post-holiday windfall
Canadian startups might find some extra cash on their books this holiday season, thanks to a key provision in Bill C-69, which passed in June.
The bill, which is largely focused on clean energy investment tax credits, includes a legislative amendment to address an 2021 decision by the Tax Court of Canada that deemed government-issued loans below market rates to be a form of government assistance.
That ruling required recipients to treat favourable loans provided by government institutions as a form of government assistance—like a grant—for taxation purposes.
Why Round13 Capital is betting on venture debt
When Silicon Valley Bank’s Canadian assets went up for auction in the summer of 2023 following the California-based, venture-focused bank’s collapse, 13 companies submitted bids to claim either a portion or all of the Canadian loan book.
Among them was a unique contender: Toronto-based venture firm Round13 Capital.
While it was not the only venture firm that sought to buy SVB assets, Round13 had a different goal. Typically focused on equity investments in scaling tech companies, Round13’s bid signalled a desire to explore a new asset class: venture debt.
Koho rolls out AI tool to help investigate fraud and scams
Canadian FinTech startup Koho is using a generative artificial intelligence tool it claims will speed up its investigations of money laundering and terrorism funding.
The company says its internal tool now performs the “busy work” of anti-money laundering investigations and reduces the time analysts spend on an investigation from an average of 95 minutes to 35.
BETAKIT’S #CDNTECH 2024 WRAPPED
In a landmark year for Canadian tech, its publication of record covered it all. From record-breaking funding rounds to red-hot political debate and emerging trends, BetaKit looks back at the defining Canadian tech stories of 2024.
- Large funding commitments and unfinished policy initiatives will be the federal Liberals’ innovation legacy. A requiem for its (failed) innovation strategy comes Monday.
FEATURED STORIES FROM OUR PARTNERS
What does Canada need to lead the AI race? Garry Chan, Chief AI Advisor at ventureLAB, represented Ontario’s hardtech incubator earlier this month at the Global Partnership on AI Summit in Serbia. While the summit gathered leading voices from Big Tech, academia, and policymakers, Chan focused on the perspective of early-stage startups.
At ventureLAB, Chan helps startups integrate AI with hardware, de-risk solutions, and drive breakthroughs across manufacturing, healthcare, and transportation. He spoke with BetaKit about the role of startups in the AI conversation, and what Canada must do to lead globally. Read our full conversation with Chan.
Weekly Canadian Deals & Dollars
- FIN – Formerly Canada-based Hostaway secures $365M USD
- CGY – Fluid Biomed raises $27M CAD Series A
- TOR – Realize commits $32.5M CAD to seven fund managers
- MTL – Deep Sky secures $40M USD grant
- MTL – Glen Ventures lands $5M from Investissement Québec
- MTL – Jolt moves French semiconductor carveout to Montréal
The BetaKit Podcast – The biggest tech stories of 2024
“We are about to see a bunch of people who are powerful, successful, and feel like they know the best way to do things, bring this approach into government.”
The BetaKit Podcast reviews the biggest tech stories of 2024 before doling out annual letter grades for Shopify, Wealthsimple, Cohere, and many more. A podcast so good we had to record it twice. Have a different take on 2024? Let us know: podcast@betakit.com.
Take The BetaKit Quiz –This week: The big moves from Wealthsimple, Clio, Shopify, and more in 2024.
Think you’re on top of Canadian tech and innovation news? Time to prove it. Introducing The BetaKit Quiz, a new weekly challenge dropping every Friday.
Image created by Meagan Simpson.