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More than 85% of corporate apps are expected to be SaaS by 2025
The global Software as a Service (SaaS) market is set to increase from US $273.6 billion in 2023 to US $908.2 billion by 2030, with a CAGR of 18.7%.
SaaS solutions have made rapid progress with the help of artificial intelligence and machine learning to improve operations proficiency and intelligence across businesses. By 2025, more than 85% of corporate apps are expected to be SaaS.
75% of business leaders mention enhanced business agility, while 74% highlight the speed of implementation and deployment as reasons influencing their company’s shift to an exclusively SaaS model. North America currently
has the largest proportion the largest proportion (67%) of the world’s SaaS companies owing to the pioneering development of technologies such as AI, IoT, Robotics, and Cloud in the region.
The future of SaaS is driven by the demand for collaborative software, marketing technology (MarTech), the continued rise of vertical SaaS, and no-code becoming the norm.
Shopify, Wave, Hootesuite were made here
Canada is home to over 6,800 SaaS businesses. Homegrown brands like Shopify, Wave Accounting, Hootsuite, League, SkyHive, Vidyard, and Memi have made their mark globally, demonstrating the country’s capability in creating and exporting innovative software solutions to the world.
Common high-growth SaaS companies appearing on both Deloitte and the Report on Business lists include Mistplay, Clutch, Marble, Dialogue, Blockthrough, Smile Digital Health, Klue, Vention, League, Wavo.me, Later, Ada, hungerhub, AlayaCare, and Thinkific.
The importance of staying vigilant and agile in navigating the ever-changing economic, geographical, political, and financial landscape is paramount for the Canadian SaaS industry right now. With an annual growth rate of 5.8% the market volume in the Canadian SaaS industry is expected to reach CA $11.42 billion by 2028.
The Canadian SaaS sector witnessed a remarkable year-over-year rebound in investment in 2023. According to L-SPARK’s State of SaaS report investment in Canadian SaaS startups totalled CA $6.9 billion in 2023. This figure is nearly double the CA $3.9 billion invested in 2022, signalling a robust recovery from 2022’s downturn.
In 2023, the largest SaaS exit was worth USD $1.3 billion and the largest rumoured deal stood at $270 million USD. Around 62 M&A or buyout deals were identified, with notable transactions including Thomabravo’s US $1.6 billion acquisition of Magnet Forensics, Cisco’s acquisition of Accedian, and Recursion Pharmaceuticals’ acquisition of Cyclica. Several more Canadian SaaS companies also stood out for their financing rounds. Jobber’s US $100 million Series D financing, Miovision’s billion CA $260 million in April and an additional CA $36 million in October, and MindBridge’s CA $60 million investment from PSG Equity.
The year closed at approximately 628 active investors in the SaaS space, with BDC, Graphite Ventures, Yaletown, Inovia, and more leading the charge as top Canadian investors.
The second biggest tech cluster in the world after Silicon Valley
Ontario is also very well positioned to take advantage of a number of leading IoT companies based in the province, including ATS Automation Tooling Systems, Teledyne Dalsa, and Prodomax.
The province is actively investing in the development of Smart Cities with three tech hubs in Ontario: Toronto, Kitchener, and Mississauga are working to make the concept a reality.
Ontario has an endless pipeline of tech talent. With over 65000+ STEM graduates being dispensed out of 47 universities and colleges yearly, SaaS start-ups can enjoy an abundance of qualified talent.
IT R&D centres are also spread across several verticals like communications, cryptography, geographic information systems, geoinformatics, imaging, learning, microelectronics, mobile experience innovation, quantum computing, semiconductors, telecommunications, virtual laboratories, and wireless technologies. The province has world-leading researchers and institutes that collaborate with businesses.
Canada’s trade agreements cover markets valued at over US $50 trillion with 1.7 billion consumers. Canada has free trade agreements with the largest manufacturing markets in the world: the United States (USMCA), the European Union (CETA) and Asia-Pacific (CPTPP).
Your business can have access to 187 million consumers within a day’s drive of the Greater Toronto Area. Ontario has 4 international and 300 regional airports, 250,000 km of roads and highways, a dozen border crossings and the 6th most internationally connected airport in the world.
See all of our programs and find out how TBDC can maximize the potential in your SaaS business.
Largest SaaS
sector in Canada
of Canadian IT workers are here
in annual contribution to IT sector GDP
country in the world to adopt a national AI strategy
in the world for tech job creation (Toronto)
annual STEM graduates
Funding, Resources and Organizations
Using the Business Benefit Finder, you can find many more government grants and incentives relevant to your tech startup.
OCI supports innovation and collaboration between industry and academia. It provides funding and resources for research and development projects to drive innovation and technology adoption.
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