Murad Hemmadi

New from me: AI researchers in Edmonton are dreaming different dreams these days DeepMind Alberta's closure in early 2023 was covered as a blow to the area's AI ambitions. Two years later its AI ecosystem is thriving, with startups, breakthroughs and more thelogic.co/news/the-big-r…

New from me: CPP Investments has invested in both Anthropic and Cohere, putting US$50 million into each of the AI firms' megarounds last year. The Canadian pension fund is the latest major investor to back competing modelmakers amid the AI boom. thelogic.co/briefing/cpp-i…

Tip @Techmeme

New from me: Y Combinator said it will resume investing in Canadian-incorporated firms, walking back a recent change after feedback from Canadian founders The reversal comes after @the_logic reported YC had dropped 🇨🇦 from its approved list of domiciles thelogic.co/news/y-combina…

New from me: Y Combinator is no longer investing in Canadian startups. The accelerator recently cut Canada from its list of countries where enrolled firms can be incorporated. They'll now need a new parent company in the U.S., Cayman Islands or Singapore. thelogic.co/news/exclusive…

@OPMWire @ddebow Increasing exemptions also costs the government in foregone tax revenue, at least in the short term, assuming the change has the intended effect of fostering more startups and exits that balance it out. So regardless of the intent and mechanism, that's money Ottawa has to find.

@ddebow not asking for money is a start, but The Logic highlighted your idea for a $25m cap gains exemption because "talent is leaving for greater economic upside elsewhere" 1) I doubt first-time founders even know the regime 2) California taxes cap gains at 37% combined marginal

Surprising

@markrmcqueen I understood the point.

@muradhem But that wasn't the point, of course. It was about the concept that gov't can pick winners.

I guess a headline reporting that "Ottawa advised to choose champions and spend big to build AI industry" sounds better than "Ottawa should pick winners and losers in the AI Industry."

New from me: If Canada wants to compete in the global AI race, it must overhaul the way it buys from and backs businesses, and focus its support on the most promising firms and applications, AI Strategy Task Force members told the federal government thelogic.co/news/ai-strate…

@AI_4_Healthcare I'm on night two of reading!

This dropped on Monday, February 2nd, with no fanfare from Canada's AI Minister @EvanLSolomon. Zip file downloaded, it's an all-nighter of reading ... with and without AI. Heads up @muradhem and @davidakin. #cdnpoli #SovereignAI open.canada.ca/data/en/datase…

@1vnzh I hear good things about the boogie boarding

what's the best bowl of pho in delaware?

@laura_buhler I tend to stop engaging at the point where someone invokes "clickbait," because if you think I'm writing stories in bad faith, you must assume I'm responding in it as well. Have a great evening.

@muradhem And the trend is increasing. In fact, EU-based startups are the fastest-growing for Delaware corp incorporations. This is probably some boring administrative thing from YC. This is a nothing burger into Canadian click bait.

@laura_buhler But that's more of an eye-of-the-beholder definition. And country (or state) of incorporation has tax, legal and regulatory implications, which is of course why founders and firms choose carefully.

@laura_buhler I hear that, and of course it matters where decision making authority rests, where most of the business is done etc. The flip is also true—lots of Canadian-incorporated tech firms do most of their business in the U.S., have U.S.-based CEOs and/or executive teams etc.

@laura_buhler What’s a “Canadian startup” or “Canadian company” in this context? A Canadian-incorporated or -domiciled entity is a pretty clear definition.

@muradhem @harleyf @garrytan I actually think your story seems pretty factual. It's the headline that is misleading and has driven a lot of misunderstanding. Just because they're requiring a Delaware corp does not mean they aren't investing in Canadian startups anymore, nor requiring permanent dislocation.

@harleyf @ruffoloj Nowhere does the article say that YC is passing judgment on Canadian *founders*, that it doesn't like or fund them, or that this specific administrative decision is to blame for the bleed. That's reading beyond the actual text of the story.

@ruffoloj @muradhem I haven't said anything about fundraising at all. I am only stating that the article stretches what seems like a quasi administrative decision by YC into some side debate about them passing judgement on Canadian founders.

@harleyf Does the corporate plumbing—i.e. location of parent company or incorporation—matter though, from a Canadian ecosystem and prosperity perspective? Because I think that's also what this graph shows—Canadian founders are increasingly building or at least headquartering in the U.S.

@muradhem @garrytan Then it's clear we all missed the point of your story. YC funds Canadian founders all the time. This is about corporate plumbing, not talent.

@harleyf @garrytan I didn’t take it as a knock. The story says the same thing: U.S. investors often prefer a U.S. corp structure, like Delaware C-Corp, and lots of Canadian cos switch anyway. The story just says that YC now requires it of Canadian cos, or at least doesn’t offer an exception anymore

I think you’re missing @garrytan's point here. He's not saying Canadian startups or founders are inferior. He's simply stating the practical reality: for startups aiming to raise venture capital, incorporating in certain jurisdictions (like Delaware) is far more advantageous, regardless of where the founders live or started. This isn't a knock on Canada or its talent…best I can tell.

@garrytan That’s what the story says—that Canadian startups will now have to reincorporate or flip to a U.S. (or Cayman or Singapore) corp to receive YC investment

@muradhem This is overstating it. We fund tons of Canadians and Canadian startups But if you are going to raise money you should just convert to Delaware C Corp.

@hyrumjb3 The story doesn’t say they’re being banned, just that they’ll have to incorporate a new parent company in the U.S., Cayman Islands or Singapore, because YC won’t invest in Canadian startups

@muradhem To be honest, that sounds a lot worse than it is Canadian companies can still be in YC, they just have to change their structure ... it's not like people from Canada are being banned

@MattWilsonYYC The story makes clear YC isn’t avoiding Canadian founders, that investors prefer Delaware C-Corps, and that foreign firms often reincorporate in the U.S. pre- or post-YC on their own. Why YC has made this change is something it hasn’t responded to questions about.

Worth clarifying: YC isn’t avoiding Canadian founders—they’re no longer investing in Canadian-domiciled entities due to cross-border tax & admin complexity. This has been standard guidance for years. Canadian startups targeting US VC have long been advised to incorporate in Delaware (the “flip”). YC is just formalizing what’s already been common practice.