Toronto emerges as a major AI hub outside Silicon Valley

Toronto has become one of the world’s most important AI centers, rooted in Geoffrey Hinton’s decision in the 1980s to pursue machine learning research at the University of Toronto. Google, Nvidia, Meta and Microsoft have opened offices or research labs near the university, while Sanofi announced a nearly $300 million investment in a Toronto AI Center of Excellence.

The city’s rise is supported by the University of Toronto, the Vector Institute and a generation of founders trained around Hinton’s work. Cohere co-founder Nick Frosst studied under Hinton and helped build a company now valued at $7 billion. Canada is also backing the sector through a national AI strategy that includes more than $2 billion in spending on research, education, adoption and safety guardrails.

Toronto’s backers point to immigration policy, healthcare, public schools, lower living costs and proximity to markets such as New York, Washington, DC and Chicago as advantages. Radical Ventures co-founder Jordan Jacobs said a 90 minutes flight can reach 200 million people, while local leaders argue that building outside Silicon Valley creates more room for debate and reduces staff churn.

Canada’s digital sector contributes more than $140 billion to GDP, and founders say global demand for alternatives to US-based technology is creating an opening for Canadian firms. Waabi, founded in Toronto after Raquel Urtasun left Uber’s autonomous driving lab, raised a more than $1 billion Series C earlier this year.