American companies are setting up artificial intelligence hubs north of the border, deepening the pool of AI expertise in Canada.

But those same companies might also be providing Canadian firms with tough new competition for top AI talent, right in their own backyard.

“What does Canada need to really foster this AI community? The most important thing is probably talent,” Shea Balish told an industry event in Toronto on Wednesday. He’s the co-founder and CEO of REP.ai, a Toronto startup building video-based AI applications for the sports and healthcare markets.

“You see a lot of these big companies moving their research labs as close as possible to U of T (University of Toronto) because they need the talent. We’re competing against the (salary) offers of Google, which are easily six figures. So we have to keep finding ways to foster that talent,” Balish said.

REP.ai CEO Shea Balish.

In early July, DeepMind Technologies Ltd. – a British AI firm owned by Google’s parent company Alphabet Inc. – announced plans to open a research facility in Edmonton, its first ever outside of Europe.

One alternative to establishing an AI lab in Canada is to invest in a Canadian AI startup. Last month Microsoft Corp., Intel Corp. and Nvidia Corp. were among the U.S. investors participating in a first round VC deal that raised $137.5 million for Montreal’s Element AI. That financing has been called the largest ever for an AI startup, anywhere.

Some U.S. companies are opting to acquire Canadian AI firms outright. Microsoft bought Montreal’s Maluuba and Google purchased Toronto-based DNNresearch. Meta Inc., another Toronto AI firm, was acquired by the Chan Zuckerberg Initiative, a company launched by Facebook Inc. founder Mark Zuckerberg and his wife Priscilla Chan.

It remains to be seen whether all this foreign interest and investment in Canadian AI will keep homegrown talent in Canada or ultimately reroute it to the U.S.

NextAI

One organization making a concerted effort to retain Canadian talent is NextAI. Founded last fall by non-profit entrepreneurship group Next Canada, it gives 20 AI startups access to technology, mentorship and up to $200,000 each in funding from corporate, government and academic partners such as RBC, Google, IBM, Harvard University and U of T.

Although foreign startups can apply to NextAI, they must complete the program in Toronto. A press release announcing the initiative said NextAI would “see the brightest minds from around the world creating industry-leading AI technology in Canada, cementing our place as a world leader in machine learning innovation.”

At a presentation in January, Next Canada board member Tony Lacavera said the goal of NextAI is “to stop and reverse this brain drain and actually attract the best and brightest from around the globe to Canada – and the only way we’re going to ensure Canada continues to make its way in artificial intelligence is if we make it the best environment possible for both creation and innovation.”

So what can Canadian startups do to compete with large U.S. companies for AI talent? Balish said his firm is “creating powerful relationships with research institutes,” something he said NextAI has assisted REP.ai with.

Karen.ai CEO Noel Webb.

Balish’s fellow panelist, Noel Webb, said NextAI helps Canadian AI startups with aspects that are entrepreneurial, not just technical.

“The faculty and the staff there are experts not just in areas of AI but in areas of business. So it’s allowed us to really formalize and structure the business strategies in several ways, to give us the ability to grow our business faster and leverage interactions and the community as well,” said Webb, co-founder and CEO of Karen.ai.

Webb’s Toronto company uses AI and predictive software to help recruiters find the most suitable candidates for job openings.

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