Ever since we saw Boundless Immigration pitch us in 2018, we’ve had a strong thesis that Canada is a legislatively friendlier tech talent hub for immigrants. It all started with a pitch that the H-1B visa process was difficult to navigate, and that work permit seekers were frustrated with the process and giving up. A clear need for a streamlined solution was the pitch.
While we didn't invest in Boundless, this experience led us to delve deeper into the tech ecosystem in Vancouver and beyond. The H-1B lottery process is indeed flawed, and with recent tech layoffs in the U.S. posing threats to visas/work permits, many talented individuals are abandoning the process of entering the United States. In response to these circumstances, Vancouver is rapidly becoming a tech-dense hub. Testament to this is the fact that five of our last 15 investments have been in Canadian companies.
As immigration policy frameworks seem stagnant in the U.S., our northern neighbors are enthusiastically welcoming tech talent. They offer incentives such as R&D tax credits, which add substantial non-dilutive capital to our investments, friendly immigration policies, and generally lower costs of living (for instance, Seattle is 23% more expensive than Vancouver, even before accounting for healthcare.) Additionally, the Canadian federal government has made massive investments in technology and innovation in cities like Calgary, Toronto and Vancouver, laying the foundations for a robust Canadian venture ecosystem.
However, similar to Seattle, Canada is capital constrained and very few funds are dedicating the time to understand the problem. Over the past five years, we’ve been thoroughly familiarizing ourselves with the process, building the relationships, and investing in the region. This is one of the key reasons why we built Breakwater.
