It’s becoming more evident that it’s easier to do business outside of Canada than within it. This is the reality many Canadian founders face. I recently spoke with a founder who told me they have more partnerships abroad than at home. My response? “Same.” But why is that? Why do Canadian entrepreneurs struggle to gain traction in their own country?
Limiting Factors
Is there too much red tape? The current policies in Canada are not favourable as talent and founders are leaving the country to build outside. This is because there’s no incentive for Canadian founders to build.
As founders navigate the ecosystem, you have to get resourceful to turn the table around. Here’s one founder had to say about this
“Taxes, appetite for entrepreneurship, and overall population are limiting factors that can truncate your growth and limit your outward potential. Having said that… Starting and feeling out your initial startup is a great fit for the Canadian market. It’s basically USA Lite. It’s absolutely not 1:1 but it’s a great approximation to see what it would be like.” – John Marzo Founder & CEO at Airfariness
Another founder shares his insight on starting a startup in Canada
“The regulatory aspects are sometimes too restrictive or unclear, operating expenses can be high initially, but some digging deeper gives some solutions to our problems. The market sector question is a challenging one since business potential is somewhat limited based on business type. There is also a fundamental difference of advantages that a larger market size offers (you can fail multiple times and get back up) and overall the perception of failure is a problem – we hear too many times, “their business failed” instead of “they are encountering challenges but learning to succeed”. – Anil C. Sedha Founder at Whistle Technologies
The Ecosystem Needs a Revamp
The problem lies in an ecosystem that claims to support innovation, but often fails to deliver. Funding, for instance, isn’t going to the entrepreneurs who are actually building. Instead, there’s too much fluff—too many initiatives that look good on paper but don’t translate into meaningful support for startups. Are we actually building more sustainable businesses in Canada? Canadian founders are forced to look elsewhere for investment, partnerships, and market access.
Lack of Distribution
Another major challenge is the lack of visibility for Canadian startups. Mainstream media only pays attention when there’s a funding round or layoffs. The stories of entrepreneurs building world-class products often go unnoticed, leaving them in the dark. Without media coverage and distribution, how can Canadian startups compete on a global stage?
Most Number of Startup Accelerators
Canada has the most number of startup accelerators and incubators in the world. You can check out the global startup ecosystem guide here. Does it translate to funding more ventures? More sustainable businesses? Not necessarily as majority of funding goes to actually running these programs.
More Global Mentality
Canadian entrepreneurs have to find ways to break into new markets. Jumping into another massive tech meetup won’t help with scaling beyond the domestic market. Instead, founders need to rethink their approach, focusing on storytelling, international networks, and strategic expansion.
A Call for Change
If Canada wants to foster a thriving startup ecosystem, it needs to prioritize real entrepreneurs over bureaucracy. Funding should be directed to those actually innovating, and media should highlight these local stories especially for bootstrapping.
Canadian startups don’t lack ambition—they lack the right support. Until that changes, founders will continue to look beyond our borders for the opportunities they can’t find at home.
