Alberta
Edmonton triples venture capital investment in 2023
Alberta’s tech sector continues its strong momentum, with Edmonton seeing its strongest growth ever, proof Alberta remains a hot tech market.
As global and national investment have declined, Alberta has remained a strong tech market and is showing continued leadership, as shown by Pitchbook ranking Calgary as the 12th fastest-growing tech ecosystem in the world and LinkedIn ranking Calgary as one of the best places to hire and recruit tech workers.
At the end of 2023, Alberta’s five-year growth rate for venture capital dollars invested reached an impressive 48.5 per cent, more than triple Canada’s compounded average growth rate of 13 per cent, according to the 2023 Canadian Venture Capital Private Equity Association fourth-quarter report.
The province’s growth rate means Alberta finished 2023 with $707 million invested over 86 deals, in line with Alberta’s 2022 record-breaking year. In contrast, Canada ended the year with a 31 per cent decline in investments. Over the past five years, Alberta technology companies have secured more than $2.7 billion in venture capital funding across 350 deals, creating thousands of jobs for Albertans.
“While Canada as a whole saw massive declines, Alberta has held steady. We are a major venture capital player in Canada, as technology drives growth across all sectors.”
Alberta’s two largest cities continued to attract investment dollars in 2023, with Calgary and Edmonton coming in fourth and fifth respectively for number of deals, with $501 million invested in 64 deals in Calgary and $188 million invested in 21 deals in Edmonton. Edmonton saw a 324 per cent increase from $58 million in 2022 to $188 million in 2023. In total, Alberta captured 10.3 per cent of dollars invested in 2023 and 13 per cent of venture capital deals in Canada.
“Edmonton’s tripling of venture capital investment in 2023 underscores our city’s position as a dynamic tech capital within Alberta’s thriving innovation ecosystem, reaffirming our role as a powerhouse driving technological advancement and economic prosperity across diverse sectors. It is the local innovators’ relentless pursuit of solutions to real-world problems, with the continuing support of the Government of Alberta, which not only attracts significant investment but also propels our city to the forefront of Alberta’s tech revolution and fosters job creation for our community.”
“At Platform Calgary we are working with our partners to continue this momentum by linking up high potential tech startups with the investors that can help them take their businesses to the next level. The evidence is clear, Alberta is emerging as one of the most exciting and resilient tech ecosystems in the world. Together with our growing tech community, we can secure Alberta’s position as the best place in the world for anyone to launch and grow a tech business.”
Alberta remains a growing market for the technology and innovation sector, and Alberta’s government celebrates its steady contribution to the Alberta economy, including in the fourth quarter of 2023. The end of last year saw venture capital investments in the province increase by 35 per cent for dollars invested and 19 per cent for deals closed compared with the third quarter. There were 25 deals closed valued at a combined $173 million in the fourth quarter of 2023.
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Fueling innovation through AI data centre attraction
Alberta’s government is aiming for Alberta to become North America’s destination of choice for Artificial Intelligence (AI) data centre investment.
The AI data centre attraction strategy identifies three pillars that create the foundation of Alberta’s work to position itself as a competitive player in the global AI landscape: power capacity, sustainable cooling and economic diversification. In each of these strategic areas, there are policy and regulatory levers required in addition to other steps Alberta’s government is taking to ensure Alberta is the most attractive and competitive destination for this emerging sector. The entire approach prioritizes competitive advantages, economic integration, market stability and keeping utilities reliable and affordable.
“Artificial intelligence is behind all the newest technologies we rely on to make our lives better, simpler, safer. There’s incredible opportunity around artificial intelligence and we are unafraid to dream big. This strategy will position Alberta as the place to invest and build AI data centres, further building on our reputation as a province with no limit to innovation and opportunity.”
The world’s largest AI companies are in search of opportunities to build and energize their data centres. Alberta, with its abundant natural gas supply and world-class power industry, is highly attractive to AI data centre projects. The province’s unique competitive power market opens the door to many opportunities for AI companies to partner with Alberta’s talented and experienced electricity sector. The sector has decades of experience in finding innovative solutions to meet industry’s power needs while maintaining a balance of affordability and reliability in a system that Albertans count on.
AI data centres generate a lot of heat and require cooling. The strategy encourages operators to determine the cooling technology best suited for their needs, water license availability and regional and project circumstance. Additionally, Alberta’s climate offers significant advantages for AI data centres because of the province’s cold winters, which would reduce the need for artificial cooling systems.
Alberta’s government seeks to ensure Albertans benefit from AI data centres and is committed to ensuring economic growth and shared prosperity while ensuring Alberta continues to have the lowest taxes in Canada and is competitive across North America.
“Alberta is uniquely positioned to capture the AI data center opportunity, leveraging our vast natural gas resources and pro-business environment to create thousands of high-quality jobs and attract billions in investment. This strategy is not just about building infrastructure; it’s about fostering innovation and establishing Alberta as a hub for high-tech industries, driving economic growth and supporting critical public services like healthcare and education.”
Alberta is committed to fostering innovation and ensuring technology development aligns with industry needs. The strategy was developed after extensive consultation with organizations and businesses in the AI space and market participants.
“For AI companies to build and scale in Alberta, they need access to computing power. Data centers are economic growth engines that provide the computing power AI companies need to develop and deploy their innovations. grow their companies and stimulate the local economies. Beyond its natural advantages, Alberta boasts a robust AI ecosystem anchored by world-class research and talent. Many of the algorithms the world’s data centers are running on have been pioneered by Amii researchers right here in Alberta. The opportunity for those companies to be close to the source of some of the leading AI research gives them a competitive advantage in being at the forefront of what is coming next.”
Quick facts
- Over the past several months, Technology and Innovation met with AI data centre builders and operators, power generators, natural resource sector participants, telecommunications companies and municipalities actively pursuing AI data centres.
- AI data centre market size is anticipated to more than double by 2030 to more than $820 billion. (P&S Market Research)
- Alberta Electricity System Operator (AESO) has 12 data centre projects on their project list totalling 6,455 MW of load.
- Most of the power demand on the AESO project list is from data centers.
- Currently there is about 1,000 MW of additional dispatchable generation over Alberta’s current needs. This amount is dynamic and may change due to factors such as generation retirements, outages, derates, or new additions.
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From the Fraser Institute
Not only does Alberta have a fully funded separate (Catholic) school system, it also provides between 60 and 70 per cent operational funding to accredited independent schools. In addition, Alberta is the only province in Canada to allow fully funded charter schools. And Alberta subsidizes homeschooling parents.
This week, the Smith government in Alberta will likely pass Bill 27, which requires schools to get signed permission from parents or guardians prior to any lessons on human sexuality, gender identity or sexual orientation.
It’s a sensible move. The government is proactively ensuring that students are in these classes because their parents want them there. Given the sensitive nature of these topics, for everyone’s sake it makes sense to ensure parental buy-in at the outset.
Unfortunately, many school trustees don’t agree. A recent resolution passed by the Alberta School Boards Association (ASBA) calls on the Smith government to maintain the status quo where parents are assumed to have opted in to these lessons unless they contact the school and opt their children out. Apparently, the ASBA thinks parents can’t be trusted to make the right decisions for their children on this issue.
This ASBA resolution is, in fact, a good example of the reflexive opposition by government school trustees to parental rights. They don’t want parents to take control of their children’s education, especially in sensitive areas. Fortunately, the Alberta government rebuffed ASBA’s demands and this attempt to abolish Bill 27 will likely fall on deaf ears.
However, there’s an even better safeguard available to Alberta parents—school choice. Out of all Canadian provinces, Alberta offers the most school choice. Not only does Alberta have a fully funded separate (Catholic) school system, it also provides between 60 and 70 per cent operational funding to accredited independent schools. In addition, Alberta is the only province in Canada to allow fully funded charter schools. And Alberta subsidizes homeschooling parents. Simply put, parents who are dissatisfied with the government school system have plenty of options—more than parents in any other province. This means Alberta parents can vote with their feet.
Things are quite different in other parts of the country. For example, Ontario and the four Atlantic provinces do not allow any provincial funding to follow students to independent schools. In other words, parents in these provinces who choose an independent school must pay the full cost themselves—while still paying taxes that fund government schools. And no province other than Alberta allows charter schools.
This is why it’s important to give parents as much school choice as possible. Given the tendency of government school boards to remove choices from parents, it’s important that all parents, including those with limited means, have other options available for their children.
Imagine if the owners of a large grocery store tried to impose their dietary preferences by removing all meat products and telling customers that the only way they could purchase meat is to make a special order. What would happen in that scenario? It depends on what other options are available. If this was the only grocery store in the community, customers would have no choice but to comply. However, if there were other stores, customers could simply shop elsewhere. Choice empowers people and limits the ability of one company to limit the choices of people who live in the community.
Think of government school boards as a monopolistic service provider like a grocery store. They often do everything possible to prevent parents from going anywhere else for their children’s education. Trusting them to do what’s best for parents and children is like assuming that the owners of a grocery store would always put the interests of their customers first and not their own self-interest. Monopolies are bad in the private sector and they’re bad in the education sector, too.
Clearly, it makes sense to require schools to get proactive consent from parents. This ensures maximum buy-in from parents for whatever courses their children take. It’s also important that Alberta remains a bastion of school choice. By making it easier for parents to choose from a variety of education options, Alberta puts power in the hands of parents, exactly where it belongs. Parents in other provinces should want that same power, too.
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