“Not a Blip”: AI Was Canada’s Venture Market Mover in 2025

Why It Matters

The AI premium reshapes valuation benchmarks and term expectations for Canadian startups, influencing how founders and investors negotiate deals across all stages.

Key Takeaways

• AI captured 54¢ of every venture dollar in 2025
• AI deal sizes grew 177% since 2023
• AI median valuations 60% above other sectors
• SAFEs and convertibles totaled $1.8B CAD (~$1.33B USD)
• FinTech funding rose 625% to $1.3B CAD (~$0.96B USD)

Pulse Analysis

Osler’s 2025 Deal Points Report provides the most granular view of Canada’s venture activity, revealing that artificial intelligence was not a fleeting hype but a structural shift. By analyzing 140 preferred‑share financings worth roughly $4.66 billion USD, the firm shows AI secured 54 cents of every invested dollar and drove a 177 percent increase in average deal size since 2023. These numbers underscore a premium valuation environment where AI startups command median pre‑money valuations about 60 percent higher than their non‑AI peers, setting new benchmarks for the entire ecosystem.

The report’s inclusion of 240 SAFEs and convertible notes—valued at $1.33 billion USD—highlights the growing reliance on these instruments in early‑stage financing. Founders now have concrete data to negotiate terms that were previously opaque, such as liquidation preferences and conversion caps. Investors, in turn, can benchmark risk and upside more accurately, reducing reliance on gut feel. This transparency is reshaping deal dynamics, especially for pre‑seed and seed rounds where SAFEs dominate.

Beyond AI, the data points to broader momentum: FinTech attracted $0.96 billion USD, a 625 percent surge, and women‑founded companies doubled capital to $1.04 billion USD. Secondary transactions are becoming commonplace in Series C and D rounds, enhancing liquidity for early investors. Even with US‑imposed tariffs and cross‑border uncertainty dampening overall capital, the Canadian market demonstrated resilience, driven largely by AI‑centric confidence and a maturing financing infrastructure.