Another startup lost: Canada’s struggle to grow its own giants

One of Canada’s most promising tech startups is winding down after failing to secure further funding, in a move that underscores the country’s ongoing struggle to scale homegrown innovation.

Toronto-based chipmaker Untether AI has agreed to an “acqui-hire” deal with U.S. tech giant Advanced Micro Devices, transferring its staff but not its intellectual property or products.

The deal, reportedly worth around $100 million, follows a year in which the company—despite strong performance benchmarks—could not raise new capital.

Industry watchers say Untether’s closure highlights a persistent weakness in Canada’s startup ecosystem: early success, but limited long-term support.

More than 95 per cent of Canadian startups land seed funding, but fewer than nine per cent reach a second round—the lowest among peer countries.

With a cautious investment climate and a lack of large-scale venture capital, Canadian firms continue to be absorbed by U.S. players rather than growing into global contenders at home.