Canadian founders often mistake a viable Canadian business for a scalable company. But the data says export capability is still concentrated in a very small slice of firms. In this article, we’ll examine the biggest mistakes Canadian startup founders make, and what they can do to avoid them.
Staying Too Domestic, Underinvesting in Innovation, and More
Canadian founders often make the same mistakes, and it’s not just about ambition. According to data from Statistics Canada, ISED, CVCA, and OECD, the biggest mistakes Canadian founders make are:
- Building for Canada first, and too often Canada only (only 15.1% of all Canadian SMEs exported in 2023)
- Underinvesting in innovation (only 27.1% of Canadian SMEs reported engaging in at least one form of innovation in 2023)
- Failing to protect intellectual property (only 15.4% of all SMEs held intellectual property in 2023)
- Treating fundraising like the strategy (Canadian venture investment in H1 2025 totalled C$2.9B across 254 deals, the lowest H1 total since 2020)
- Not building a productivity machine early enough (Canada’s labour productivity in 2023 was USD 74.7 per hour worked, versus USD 97.0 in the United States and USD 89.3 in France)
The Consequences of These Mistakes
The consequences of these mistakes can be severe. For example, firms that don’t innovate are less likely to grow, and those that don’t protect their intellectual property are leaving themselves vulnerable to competition. Similarly, founders who assume money will always be available are playing a dangerous game, as the Canadian capital environment has gotten tighter.
What’s Next?
To avoid these mistakes, Canadian founders need to focus on building a scalable company that can compete globally. This means investing in innovation, protecting intellectual property, and building a productivity machine early on. It also means treating fundraising as a means to an end, rather than the end itself. By doing so, Canadian founders can build a company that can thrive in today’s competitive market.
