“Some founders believe Canada wants innovation, but still struggles to support the companies building it.”
A growing number of defence technology founders in Canada are becoming increasingly frustrated with what they describe as a slow and unclear approach to supporting dual-use technologies. Startup founders working in defence and advanced technology say Canada risks falling behind as other countries move faster to back companies developing technologies that can serve both civilian and military purposes.
The debate centers around something known as “dual-use” technology. These are products and systems that can be used in both commercial and defence environments. Examples include artificial intelligence, drones, robotics, cybersecurity systems, advanced sensors, satellite technologies, and autonomous software.
Many of today’s most important technological breakthroughs fall into that category. The challenge is that dual-use companies often operate in a complicated space between civilian innovation and national security. Founders say Canada has not fully adapted to that reality. While governments around the world are increasingly investing in defence technology and strategic industries, some Canadian entrepreneurs argue that local support systems remain fragmented and slow-moving.
Several founders said that the country’s current approach makes it harder for startups to scale, secure contracts, and compete internationally. The frustration comes at a time when defence technology is attracting renewed global attention. The wars in Ukraine and other geopolitical tensions have pushed governments to rethink military readiness, cybersecurity, supply chains, and technological independence.
As a result, countries including the United States, the United Kingdom, and several European nations have expanded support for defence-focused innovation. Many investors have followed the trend. Defence technology, once avoided by parts of the startup world, is increasingly becoming a major investment category.
Artificial intelligence has accelerated that shift. Governments now view AI, autonomous systems, and advanced computing as strategic assets that can influence both economic competitiveness and national security. That has created enormous opportunities for startups working in those sectors.
Canadian founders argue that the country risks missing those opportunities if support structures do not evolve. One of the concerns raised in the report is procurement. Many startups struggle to secure government contracts, even when their technologies align with national priorities. Founders say procurement processes can move slowly and often favor larger, established companies.
That creates challenges for younger firms trying to prove their capabilities. Without early contracts or pilot projects, many startups find it harder to attract investment and scale their products. Another issue is perception. Some entrepreneurs say defence-related startups still face hesitation from parts of the broader technology ecosystem.
For years, many venture capital firms focused heavily on consumer technology, software platforms, and enterprise tools. Defence technology often receives less attention. That mindset is beginning to change globally, but founders argue the shift has been slower in Canada. The conversation reflects a larger transformation happening across the technology sector.
A decade ago, many startup founders focused primarily on consumer convenience and digital experiences. Today, attention is increasingly moving toward infrastructure, security, manufacturing, energy, and strategic technologies. Governments are becoming more involved because those industries carry national importance. The line between commercial innovation and national security is becoming thinner.
That reality is driving demand for dual-use technologies. A report suggests that Canadian founders are not asking for special treatment. Many simply want clearer pathways for collaboration, procurement, funding, and commercialization. They argue that strong domestic support could help keep innovative companies inside Canada instead of pushing them toward larger foreign markets.
That concern is becoming more important as global competition for advanced technology intensifies. Countries are increasingly treating technological leadership as a strategic priority. Startups developing AI systems, cybersecurity tools, drones, and advanced hardware are attracting attention not only from investors but also from governments seeking long-term competitive advantages.
The stakes are much higher than they were a few years ago. For Canada, the issue extends beyond startup success. It touches economic growth, industrial development, and technological sovereignty. If promising companies struggle to scale locally, much of the value created by their innovations could end up benefiting other countries instead. That possibility is fueling frustration among some founders who believe Canada has the talent and research capabilities needed to compete globally.
The challenge is turning those strengths into thriving companies. The debate over dual-use technology is ultimately about more than defence. It is about how countries support innovation in a world where technology increasingly shapes both economic power and national security. Founders argue that reality is already changing.
Their concern is whether Canada’s systems are changing fast enough to keep up. As governments around the world invest more aggressively in strategic technologies, the pressure on Canada to adapt will likely continue growing.
The companies raising concerns today may represent a much larger question about the country’s future role in the global technology race.
