Written by Laura Lenz
If the last few years have taught us anything, it’s that predicting which way the wind will blow is as futile as debating the origins of 6,7. Despite that, it’s hard to teach an o̶l̶d̶ ̶d̶o̶g̶ seasoned investor n̶e̶w̶ ̶t̶r̶i̶c̶k̶s̶ methods of analysis, and the inevitable onslaught of January predictions are starting to roll out.
What’s different this year is a tendency to focus on how macro currents will impact the venture landscape instead of our recent tendency to focus on microcosms and single entities as a forcing function for industry-wide change.
With that in mind, here are the patterns I’m betting on this year:
A more active market, with a return to discipline: 2026 is expected to bring a more active VC market. There’s a caveat though - the era of “growth at any cost” is behind us. The wave of AI-native startups, and the churn that followed, will force deeper diligence across the industry. Traction alone isn’t enough. Usage, retention, defensibility, and resilience are all factors investors will be looking at more carefully this year. Investors are leaning into stronger fundamentals, real traction, and economic discipline, not just momentum. The bar is higher, but ultimately that can be a win for both VCs and the companies we invest in. Stringent VC standards can help companies look at their own operating models with greater scrutiny, and that can often result in finding efficiencies or making operational improvements.
AI remains the centre of gravity: With roughly half of VC dollars investing in AI in 2025, there is no doubt that AI continues to dominate the conversation in 2026. But, a major theme I see emerging is a world where people and software learn together. Historically, enterprise software was built as siloed applications - each purpose-built for a specific department, operating on its own stack, rarely sharing data, and almost never generating insights across teams. Today, with coding acceleration and unprecedented product velocity, those walls no longer make sense. Every department needs to talk to each other, collaborate, and operate from the same source of truth if they want to move faster rather than create new bottlenecks. When humans and AI systems share context, rules, and a unified data model, entirely new forms of collaboration open up. In the enterprise, this looks like agents assisting with investigations, audits, and compliance workflows, all pulling from a single, consistent dataset. For consumers, it shows up in tools that actively learn from their finances, health behaviours, or daily patterns and help them make better decisions. Shared context isn’t just a technical shift, it’s the foundation for better decision-making, clearer workflows, and more reliable truth-seeking across everything we do.
Beyond software: Tools like Cursor, ClaudeCode, and Google’s Jules have made building software astonishingly fast. Moats are now harder to find (and even harder to maintain). As a result, investors are looking for opportunities beyond traditional software. Newer focus areas include: spatial AI, robotics and autonomy, energy systems, infrastructure, compute and efficiency innovation. These categories sit at the intersection of software, systems, and the physical world which carry real defensibility.
The hope of liquidity: After a multi-year drought, VCs are cautiously optimistic that liquidity may return in 2026. Beyond the IPO window, CEOs and investors are structuring more creative outcomes: de-SPACs, strategic M&A, and a maturing secondary market. Optionality matters again.
As an investor focused on the Canadian ecosystem, we believe that Canada holds a strategic innovation edge in the following areas.
Agricultural: Canada is a top-five global ag exporter, and with climate volatility and labour shortages, demand for precision tools is increasing. Promising areas are automated harvesting and weeding, sensors, AI-based yield modelling, and soil intelligence.
Critical minerals: Canada holds some of the world’s richest deposits of lithium, nickel, graphite, and rare earths. There are real technological gaps in extraction and refining where we could become a leader. Physical AI applied to mine automation and technologies that mitigate environmental concerns represent an area for future development.
Dual-use technology: Defence technology, and its applicability in non-defence use cases, is quietly becoming a compelling opportunity. We have deep aerospace clusters, talent, and government funding suited for intelligence, surveillance, and autonomy.
Energy Transition & Nuclear: Canada is emerging as a global leader in modular nuclear systems and grid modernization. We have an abundance of resources and strong engineering talent to tackle small modular reactors, grid intelligence, and carbon capture.
Robotics & Automation: Labour shortages, coupled with the high-cost manual work will drive robotics adoption. With world-class robotics research in our backyard at UofT, Waterloo, McGill, and UBC, we have the opportunity to commercialize physical AI in warehouse and logistics, Arctic and ocean autonomy, and drones.
Stablecoins & Open Banking: Canada is attempting to modernize its financial system with long-awaited policy changes. The 2025 budget introduced the groundwork for a regulated environment for fiat-backed stablecoins, creating institutionally credible digital money frameworks similar to the US GENIUS Act. And Canada’s open banking plan is (hopefully) moving toward implementation in 2026. Together, these frameworks could reshape Canada’s fintech landscape in areas of new regulated issuers, payments innovation, embedded finance, digital settlement rails, and underwriting innovation.
As we head into 2026, one thing feels certain: this next era of venture will reward clarity and discipline. The pace of technological change continues to accelerate, and Canada is uniquely positioned to lead in categories that blend AI, hard engineering, and real-world impact. The opportunities ahead are meaningful, but they require thoughtful builders and patient capital. While predicting the future may remain difficult, investing with conviction, curiosity, and a steady hand has never mattered more.
