The federal government’s artificial intelligence strategy has been highly anticipated by tech companies, researchers and civil society groups.Sean Kilpatrick/The Canadian Press
Ottawa will launch a new investment fund to support artificial intelligence startups and add hundreds of millions of dollars to an existing program as part of its coming AI strategy, according to a source familiar with the matter.
The new Canadian Tech Growth Fund will take equity stakes in companies to support their growth, the source said.
The Globe and Mail is not identifying the source because they are not authorized to speak publicly on the strategy, which is not set to be officially announced until later this week.
The source said the strategy will also top up a $300-million program called the AI Compute Access Fund that helps subsidize the costs for Canadian companies when building and running AI models. That program was first announced in April, 2024, under former prime minister Justin Trudeau. It was inundated with applications when it opened the year after, as these costs can be a barrier to growth for fledging companies.
Some applicants criticized the program for moving too slowly, and Ottawa announced the first disbursements this month, awarding $66-million to 44 small- and medium-sized businesses.
Canada’s AI strategy to fund national health data project to improve care, investment, minister says
The long-delayed AI strategy, which was initially targeted for release at the end of 2025, has been highly anticipated by tech companies, researchers and civil society groups.
CBC reported details of the AI strategy earlier on Monday based on a draft document.
The strategy will also tap the Canada Strong Fund to make investments in AI companies, the source said. First announced in April, the sovereign wealth fund has an initial budget of $25-billion to be seeded over three years. The fund is linked to the government’s goal of building large infrastructure projects, such as ports and natural resource developments.
Prime Minister Mark Carney has also tasked the federal Major Projects Office with developing sovereign cloud computing capacity to ensure Canadian-controlled infrastructure for building and running AI models.
Critics have faulted the Canada Strong Fund for being short on details and not following the model of sovereign wealth funds in Norway and Singapore.
The Canadian Tech Growth Fund, meanwhile, will serve as another investment vehicle, in addition to programs from the Business Development Bank of Canada and the federal government’s Strategic Innovation Fund.
The source said that the tech growth fund will target smaller investments, while the Canada Strong Fund will look at higher-priced deals.
Opinion: Canada’s AI strategy is set to fail before it even launches
Adoption is a big theme of the strategy, as well. It aims to significantly boost AI use among domestic businesses, which was only around 12 per cent in 2025, and offer free AI literacy training to Canadians.
The government will also consult on AI transparency issues, including discussions on watermarking AI-generated media and disclosures around automated decision-making, according to the source.
Separately, The Globe reported on Monday that the strategy will include up to $100-million to expand a project to share health data so that researchers can mine it to improve patient outcomes and ease strain on the system.
In developing and selling an AI strategy to Canadians, the government has to walk a fine line between harnessing the potential economic benefits of the technology, while protecting Canadians from the downsides.
Opinion polls show Canadians have many concerns about AI, including the potential for job losses, the spread of misinformation and how overreliance on the technology will affect learning. A Leger survey last August found that 34 per cent of Canadian respondents said that AI is good for society, while 36 per cent believe it is harmful. A separate Ipsos poll from last year said that Canadians are more nervous than excited about AI.
Last September, AI Minister Evan Solomon appointed a task force to provide recommendations on a new strategy within 30 days, and launched a public consultation.
Ottawa announced six pillars of its AI strategy in the spring economic update in April, including boosting trust through modern privacy and online safety laws, AI skills training and increasing adoption. The government also wants to encourage development of sovereign AI infrastructure to lessen dependence on foreign players, and help Canadian companies scale and establish partnerships with allies to aid firms in accessing global markets, among other goals.
Canada has been a strong player in AI research and an attractive destination for talent, in part owing to the Pan-Canadian AI Strategy launched in 2017 that supported three national research centres.
But as generative AI has exploded in the past few years, the riches have largely gone to American tech giants. That includes companies that build AI models, such as OpenAI and Anthropic, chipmakers such as Nvidia Corp., and cloud computing providers such as Microsoft Corp. and Amazon Web Services Inc.
Canadian talent has played pivotal roles at some of these companies, too. Ilya Sutskever, who co-founded OpenAI, studied at the University of Toronto. Anthropic recently hired Andrej Karpathy, who also attended Canadian universities. Even some AI stars who have remained in Canada have been recruited by American tech giants, such as Sanja Fidler, who leads Nvidia’s research lab in Toronto.