Last year, Microsoft leased four floors near the top of a skyscraper located in downtown Toronto. Both Amazon and Apple have offices in the same area.
Toronto is now North America’s third-largest tech hub, trailing Silicon Valley and New York. Ottawa, Montreal, and Vancouver have brimming tech startups as well, which is why the tech sector is growing so rapidly in Canada.
What are the fastest-growing tech industries in Canada?
E-Commerce
Ottawa is home to Shopify, one of the largest e-commerce platforms in the world. Shopify isn’t like any other shopping site out there. It is a website builder that helps small businesses sell products even if they don’t have the capital to do so.
The company employs more than 5000 people directly. And thanks to its unique business model, it helps thousands of people from around the world make money online.
While Shopify is big, it’s not the only major e-Commerce store with a significant market share in Canada. As mentioned, Amazon has been expanding its operations in the Great White North for a while.
Both eBay and Overstock have offices in the country too. Their online stores attract tens of thousands of monthly shoppers. Other large e-Commerce businesses in the country include Newegg, Home Depot, Costco, and Walmart.
Large e-Commerce stores have been moving to Canada to exploit its growing market. But that also means something else. Small entrepreneurs can also make money by investing in the industry.
Online Gambling
Legal online gambling is a brimming sector in Canada. Last year, Ontario welcomed its first commercial casino site in April. One year later, the province generated $1.48 billion from its licensed sportsbooks and casino sites.
Canadians have been showing a lot of love to the iGaming sector. Over 1.6 million people have opened accounts on licensed betting sites. And these players spent $3.56 billion betting on sports or playing casino games last year.
Why is there a huge demand for gambling in Canada? The industry is safer than it has ever been. People are no longer afraid of being scammed online if the casinos are licensed.
Another motivation for gambling online is bonuses. The best online casino bonus matches your deposit amount 100%. And that’s just the welcome reward. You could also qualify for VIP bonuses, loyalty points, or cashback money if you’re a regular player.
Interestingly, most provinces outside Ontario haven’t made up their minds about commercializing online gambling. This leaves most Canadians with no option but to use offshore casinos located in Europe or the Caribbean.
Social Media
Last year, the New York Times reported that Canadian startups were complaining about Facebook’s unfair competition. More precisely, Meta was driving salaries to levels most Canadian companies couldn’t afford.
Meta isn’t the only social media giant with an interest in Canada. Pinterest, the picture-oriented social media company, opened new offices in Toronto last year. Like e-Commerce giants, social networks have been expanding to Canada for several reasons.
Canada has a large pool of tech talents. Finding engineers, marketers, and managers is relatively easy. And thanks to the country’s friendly immigration rules, these companies can always hire expatriates if deemed necessary.
Another reason social media brands love Canada is that they can save on taxes. Canada has considerably lower taxes for tech startups compared to Silicon Valley and New York. This is especially true for provinces like Ontario and Quebec.
Banking and Finance
In 2021, Klarna, a Swedish company, opened a flashy office in Toronto featuring Mayor John Tory. A few weeks later, US-based Stripe—set up a new office in the city.
Canada has a long history of being a hub of Fintech startups. Let’s start with Neteller, one of the biggest e-wallets in the world. It opened in 1999 in Canada before relocating to the Isle of Man in 2004.
iDebit is yet another popular online payment solution for Canadians. It opened in 2006, just when online banking was populating. Over the years, more than 100 payment startups have opened in Canada.
There’s Interac, which launched in 1984 but didn’t expand to the online industry until later on. Then there are startups like Bench, Drop, Rate Hub, Coin Square, Bitbuy, and Jaxx.
Both Bitbuy and Jaxx target crypto users. Jaxx is a wallet for sending and receiving cryptocurrencies like Bitcoin and Ethereum. Bitbuy is a payment gateway that helps merchants accept cryptocurrencies.
Artificial Intelligence
Artificial Intelligence is a trending topic in 2023. While some countries are merely waiting to consume the technology, Canada is taking serious measures to reap big from the sector.
A couple of years ago, businesses in Toronto donated $100 million to help the University of Toronto build an AI building complex. The university is credited for conducting research that inspired tech businesses in North America to invest more money in AI.
Google spent $44 on this research and is now creating an AI-powered search engine that could rival ChatGPT. Google aside, startups like Hoppe, Scale AI, and Element AI all chose Canada as their headquarters.
These startups have also attracted hundreds of millions of dollars in funding over the last few years. Most of them are creating solutions that can solve day-to-day problems. For example, Cohere, which received $434M in funding last year, wants to create a language-processing engine.
Video Games
Video games are an important industry in Canada. The sector contributes $3 billion to the country’s GDP. It’s a lot less than the $20B Canada collects from tourism annually. Still, it’s a lot of money.
The Canadian video game space is dominated by large homegrown companies. However, a few well-known foreign publishers also have development studios in the country.
BioWare is arguably the most famous video game publisher in Canada. It’s the company behind Knights of the Old Republic—a Star Wars-themed video game. Since 2007, BioWare has been a subsidiary of Electronic Arts.
Speaking of which, EA has a large studio in Montreal. The studio is famous for creating Assassin’s Creed. In Nova Scotia, EA works with HB Studios to design FIFA, NHL, and Madden Football games.
