We hosted an incredible event at Mosaic on the future of manufacturing, and one conversation stood out—our chat with Avinash Persaud. Avinash is one of those rare people who brings both deep knowledge and infectious optimism to every interaction. Whenever I see him, it’s a smile, sharp insight, and a real belief in what’s possible for Canada’s hardware sector. The conversation was so valuable, I knew it had to be shared. So we turned it into a blog.

What kind of year is 2025 shaping up to be for hardware startups?

2025 is shaping up to be a pivotal year for hardware startups, especially in Canada. We’re seeing increased momentum driven by growing investment, stronger collaboration between research institutions and industry, and a sharper focus on deep tech innovation. Hardware startups are gaining traction by integrating AI and advanced semiconductor design into their products, which is unlocking new market opportunities. This year is about building sustainable ecosystems that support startups from concept through to commercialization.

There’s talk about Canadian companies becoming more self-sufficient. Are we actually seeing that shift happen?

Absolutely. Canada’s hardware sector is moving towards greater self-sufficiency. We’re witnessing a deliberate effort to reduce dependency on foreign supply chains and to foster domestic chip design and manufacturing capabilities. The government’s growing support, combined with initiatives from innovation hubs like ventureLAB, are accelerating this shift. Companies are now more equipped to design, prototype, and scale locally, which strengthens our position in the global hardware landscape.

Canada is actively working to build a more resilient, homegrown ecosystem, one that not only enables local innovation but also strengthens our global competitiveness. There’s a real push to bring more of the value chain onshore, from advanced packaging and testing to fabrication and design. By investing in infrastructure, talent, and commercialization pathways, Canada is laying the groundwork for long-term leadership in hardware and semiconductors.

Are there any interesting trends or developments you’re seeing in the hardware space that we should be paying attention to?

A few key trends are shaping the hardware landscape in 2025. AI integration is becoming essential, with companies developing specialized chips for real-time edge processing that enable smarter, faster systems in sectors like robotics, healthcare, and manufacturing. At the same time, demand for customized semiconductors in electric vehicles and smart mobility is accelerating, driving innovation in high-performance, energy-efficient chip design. These developments are creating real momentum and real opportunity for Canadian companies to lead on the global stage.

After losing such a special company like Untether AI, is there anything we can learn from that as a country?

Untether AI’s journey offers valuable lessons. Their pioneering work in AI accelerators highlighted the immense potential within Canada’s hardware talent pool. However, it also exposed gaps in scale-up support and access to late-stage capital. We need to build a stronger infrastructure that helps promising startups bridge from innovation to global market leadership. Protecting and nurturing our homegrown champions requires coordinated efforts across government, investors, and industry.

Any fun announcements coming from ventureLAB you can share?

Yes! ventureLAB is buzzing with exciting developments. We recently hosted a G7 Semiconductor Point-of-Contact Stakeholder Forum in Markham and Toronto on June 3, gathering senior delegates from all G7 nations for a guided tour of our hardware lab and incubator. This was part of Canada’s G7 2025 leadership, with a clear focus on strengthening global semiconductor partnerships and showcasing Canada’s world-class capabilities in silicon R&D and commercialization 

This summer, we’re launching our first-ever HardTech Open golf tournament—a fresh, engaging way to bring together founders, investors, and industry leaders. Our annual HardTech Summit is also returning bigger than ever, featuring more international participants and breakthrough technologies.

And we’re not stopping there: Canada’s G7 Presidency provided a powerful platform to highlight our ecosystem, and ventureLAB will continue rolling out new initiatives and partnerships all year, bringing more great announcements your way.

We have a new federal government! do you have any advice for them when it comes to our hardware sector? 

First, I want to say that we are encouraged by the new government’s agenda - we welcome initiatives such as EDC’s Trade Impact Program, aimed to help companies affected by new tariffs and global uncertainty. It’s also heartening to see interprovincial trade barriers finally coming down. It's good to see that Minister Solomon has been given a specific AI portfolio to keep Canada at the forefront of AI innovation. We hope that new initiatives encouraging the government to buy from Canadian SMEs get the attention they deserve and look forward to the government continuing to sharpen its focus on making Canada a friendlier environment in which SMEs can do business. Tax incentives to encourage investing in Canadian companies would be a good place to start. 

As we know, hardware companies face very specific challenges and international trade barriers impact them much more than software companies because not only final products but parts often need to cross multiple borders. An even stronger government emphasis will help Canada’s hardware sector to grow to be a major economic engine. Investment in hardware is critically important as it underpins emerging sectors like AI and Quantum as well as traditional sectors like Automobility and Aerospace. Equally important is a long-needed National Semiconductor Strategy to allow Canada to compete in a world where many others are putting funding and focus on this foundational technology.  

The federal government has shown an openness to engaging with the Hardtech sector; this is essential to ensure policy development that helps this sector realise its incredible potential. ventureLAB will continue to partner with the government to support Canadian Hardtech founders.

Thoughts From The Fello Team

At Fello, we’re excited about what lies ahead. Canada’s hardware sector is at a tipping point—now is the time for founders to double down, refine their commercialization strategies, and build with urgency. The future won’t wait.

We need more organizations like ventureLAB—places that don’t just support innovation, but actively accelerate it. Their leadership is critical as we work to build a more self-sufficient, globally competitive hardtech ecosystem.

Let’s get to work.