Gen Z pair built a $35M start-up in Canada, but moved to the U.S.

>The study reports that 80 per cent of graduates who relocate move to the U.S.. It also notes that approximately 66 per cent of software engineering students, 30 per cent of computer engineering students, and 30 per cent of computer science students leave Canada after graduation, citing better pay and larger companies as primary reasons.

This is a disaster indicating a failure of policy.

>After incorporating in Delaware, Internet Backyard closed a US$4.5 million funding round at a US$25 million post-money valuation in just one week. By contrast, across all of Western Canada in the first quarter of 2025, total funding raised for all pre-seed rounds was just US$3 million.

I’m honestly impressed that they managed to raise any funding in Canada. Their product is an AI-wrapped accounts receivable automation service, perhaps the pitch was *suitably low-risk*.

>“Canadian students after they graduate just go directly to San Francisco or New York, because it’s so much easier to get a working visa there,” she said, citing H-1B and E visas in the U.S.

I can see how that is important to Trinh specifically, but I think there are larger and broader concerns regarding raising capital in Canada and operating small businesses in Canada. Our financial institutions are risk-averse and stingy, and our tax treatment of investors is needlessly rent-seeking.

We are beside a country with a far greater supply of talent, and a much larger hoarde of capital; we should have the *least* punitive tax environment for small businesses and early investors. Americans should compare Delaware and Canada and see that Canada is the *obviously superior alternative.*

And we probably need to loosen up with banking regulation. We need more competition in finance institutions to encourage the sector to shoulder greater risk.

Yea there is no limit on the TN visas that Canadians can apply for under the free trade agreement so even if Trump crushed H1B visa numbers this will continue to happen. 

This really isn’t a surprise to anyone is it? You make more in the US, you can afford housing in the US, food is cheaper, it’s relatively easy for highly educated Canadians to get visas to work in the US.

Just using my own personal experience my wife was able to get a job in the states that pays double what the Canadian equivalent was advertising, and that’s after 6 moths of job searching all over Canada with a masters in a STEM field from one of the best universities in Canada in that specific field.

If you’re young person with a high level education the benefits of moving to the US far out weight the benefits of staying in Canada currently, and that sucks to say but its just reality, and given the direction the current government is moving it’s not likely to change any time soon

Canada seems to have put all their chips in real estate rather than tech. And it is unfortunate when Canada is full of brilliant, highly educated individuals, it really is a shame. I understand trying to prevent a tech oligarchy from taking over your country, but it certainly doesn’t have to pan out that way if you can build more infrastructure and safeguards to promote growth in tech while not surrendering your country’s sovereignty to it. California has tried to model that despite the shenanigans in DC. The EU has as well.

These were not Canadian citizens, though. They built the startup in Canada, which is nice, but at the end of the day, they were here on visas and so had a higher chance of leaving anyway.

Not sure I would choose to immigrate to the USA right now, though… gen Z optimistic or just naive?

As the article says, the startup visa program in Canada was so badly implemented that it is getting cancelled after accumulating a 10 year backlog. Compare that to the US, where most founders qualify for O1 visas in weeks and are able to have some stability. 

Both of these founders were recent immigrants on visas so I totally understand their reasons for jumping ship to the US. Canada needs an expedited path for founders to stay for a reasonable fee, say $10,000, that guarantees fast processing. That way the program doesn’t get spammed with nonsense applications and founders with actual funding will happily pay the fee to stay.

So I have a lot of experience in this. 22 years in software engineering, worked at many startups, worked inside a VC firm and many large incubators, been at a Canadian company that IPO’d, an American unicorn that IPO’d, and founded my own very successful startup that was acquired. Now I am doing early stage investing. Note: mods I can prove all this if need be.

Here are my thoughts:

1) They are international students and never wanted to be here and never intended to stay. It’s why they cut the country loose so quick. Had they gotten into a better American school they would have taken it. Similarly, much of those Canadian educated students leaving the country are international students or relatively recent immigrants. They have nothing tying them down here and are financial migrants chasing money. They will always go to the highest bidder.

2) Canada is actually a great country to build a company except for one thing (see next point). Lots of great talent and schools, great incubators, lots of government programs, and surprisingly low taxes on an exit.

3) But VC firms here suck royally. They all want too much equity for too little investment. Big cheques are best gotten in the US. Way more open minded investors down there willing to take risks. But they don’t need to move to the US to run their business, so I would it’s more personal choice as costs will rise.

4) They are a Borg startup. Once they sucked everything they needed to boot up, build a product, etc. using our resources, tax benefits, SRED, incubators, etc. They are off to better feeding grounds.

5) They called up BNN Bloomberg to pitch this story because they are bitter Canada didn’t give them more or they wanted some publicity for their company and this was the hook.

So ya, if we want Canadian companies to flourish we need to start making sure we focus on actual Canadians. They have friends, family, culture, and a love for this place tying them here. I know too many successful Canadian entrepreneurs to count, but that’s what kept them here. Otherwise we can’t out compete the states in many aspects.

Read the article and look into “Project Washington” in Delaware. It’s a $10B data center being built.

I’m not saying we shouldn’t be doing better at supporting startups, tech, etc. but this very little to do with US vs Canada. This startup wouldn’t have worked in NYC and SF either.

I’m pretty sure sure that, in this case, what we’re seeing is that a single investor who had money in Project Washington found it logical to throw a bone at this startup’s idea as well.

The real headline here should be “should Canada build more data centers?” But it seems that didn’t align with the political message this reporter was trying to get across.

Canada should place greater emphasis on supporting its citizens. It is surprising that many government-funded bridging and training programs are targeted primarily at new immigrants and refugees, with limited inclusion of Canadian citizens.