Canada and Europe Need A New Silicon Valley

In 2020, I co-founded Authologic, a digital identity verification platform, in Warsaw. The next year, we were accepted into Y Combinator, the Silicon Valley startup accelerator that helped launch companies like Twitch and Airbnb. At the time, European tech startups looking west only saw Silicon Valley. The region is driven by an elusive formula of technical capability, aggressive venture capital and sheer audacity. It’s a place where a guy with a weird T-shirt and a singularly bold idea could potentially transform an entire industry. 

Canadians lament that many of the country’s brightest minds pack their bags for San Francisco at the first opportunity, but until recently that wasn’t cause for concern. You go where the money is, and America has a lot of it. It was a natural consequence of globalization, and the technologies produced there were generally accessible to everyone. We could reasonably expect that the broader digital architecture of the Western world would endure regardless of who occupied the White House. These assumptions are now being stress-tested in ways that would have been inconceivable a short time ago. With so much of our essential technologies concentrated in the hands of a few American companies, political instability stemming from Washington could have profound, far-reaching consequences.

European startups are increasingly turning to Canada to diversify their partnerships, while Canada has broadened its search for new economic and technological allies. Donald Trump’s shirking of responsibility to the global community, his erraticism and unpredictability, and his regression to a might-makes-right style of politics are forcing us to reckon with just how dependent our daily lives have become on technologies we don’t control. It’s time for Canada and Europe to come together and start building their own technological ecosystems outside the sphere of American influence. 

Consider the smartphone in your pocket. The hardware was likely manufactured in China. The operating system is likely either iOS or Android—both American. The cloud system storing its data is probably run by Apple, Google, Microsoft or Amazon, which combined make up nearly 70 per cent of the global cloud infrastructure. The browser you use is almost certainly either Chrome, Safari or Firefox, and you probably used Microsoft Edge to download one of them. All four are American. Most of us rarely think about this concentration of technology because, for decades, we’ve taken it for granted. Yet if access to these systems were disrupted, the consequences would extend far beyond our smartphones, touching everything from financial markets to critical infrastructure and national defence.

Russia’s invasion of Ukraine demonstrated what happens when access to critical infrastructure is severed. Following Russia’s aggression, the U.S. and its allies effectively crippled Russia’s financial system by cutting off Russian banks from SWIFT, the Society for Worldwide Interbank Financial Telecommunication. The result was over $300 billion in sovereign Russian assets becoming inaccessible, and the value of the ruble plummeting by more than 30 per cent. The war in Ukraine demonstrated that if you don’t control a system, you’re at the mercy of whoever does. And if financial systems can be restricted, why not the digital platforms that underpin our everyday lives? Why not cloud infrastructure or AI models?

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As a Pole, I’m particularly sensitive to these issues. Poland sits on NATO’s eastern flank, bordering Russia, and our history has taught us not to take sovereignty or security for granted. We disappeared from the map for more than a century after being partitioned by our neighbours. We were invaded by both Nazi Germany and the Soviet Union in 1939 and remained under Soviet influence until 1991. This is not distant history for us—my grandfather fought for Polish independence and was imprisoned and tortured by Soviet authorities after the war. That experience taught many Poles the importance of strong alliances with trustworthy partners, so Poland moved quickly to join NATO and the European Union after regaining its independence. When Trump questions NATO’s value or openly flirts with annexing Canada and invading Greenland, we can’t help but exchange anxious glances. Countries that understand their vulnerabilities also tend to understand the value of dependable partners, which is why Canada and Europe are increasingly finding common cause.

The breakneck advancement of AI has produced an ever-expanding spectrum of concerns. In April, Anthropic unveiled an AI model called Mythos that was capable of finding and exploiting flaws in software at a level that raised extreme cybersecurity concerns. Anthropic initially kept the technology behind closed doors while it developed safeguards and eventually released a version for commercial use under the name Fable. When the Trump administration determined that some of those safeguards maybe weren’t quite safe enough, it restricted international access to a privately developed AI model with the stroke of a pen. 

AI is embedded in such critical systems as software development, cybersecurity and business operations, and industries across the globe depend on them. What happens when access can be summarily cut off by a government that controls over half of the world’s frontier AI models? It’s precisely questions like this that are spurring conversations about digital sovereignty from Mark Carney and leaders across the European Union, and why Canada and Europe currently find themselves in a shared predicament. We need to imagine and implement digital spaces that aren’t subject to the whims of an erratic superpower. We need to build a separate ecosystem capable of attracting world-class talent and producing world-class technologies. And we need to begin the process of untangling ourselves from technological dependencies that were built for a different era. Trump’s tenure may end in two years, but there’s no guarantee that Trumpism won’t crop up on future ballots.

That said, building an independent digital ecosystem from the ground up is a pipe dream. The raw materials underpinning modern technology are distributed according to geological chance, not the preferences of governments, and the complex webs of trade and interdependence that currently exist would take eons to unweave. Semiconductors alone illustrate how challenging this would be: Taiwan manufactures the world’s most advanced microchips using highly specialized equipment from the Netherlands, which are then incorporated into products assembled across Asia and sold around the globe. Neither Canada nor Europe can realistically recreate these supply chains. But a top-down approach, starting closer to the end user, is much more realistic. Rather than reinventing the wheel, Canada and Europe can focus on protections for citizens first: in payment networks, digital identity, cloud servers and applications.

Europe is already rolling out European Digital Identity, a shared digital infrastructure allowing us to authenticate our identities, access public services and conduct business across national borders using a common framework. We’re demonstrating that sovereign nations can co-operate digitally without sacrificing their independence. Canada offers its own strengths, with Toronto being one of North America’s largest concentrations of financial capital and venture investment, and the University of Waterloo becoming one of the world’s leading producers of tech talent and AI research. 

In December, the EU and Canada held the first meeting of the Canada-EU Digital Partnership Council with the goal of bolstering technological sovereignty and boosting innovation. In March, they announced negotiations for a formalized digital trade agreement. These endeavours will require mutual trust among a vast array of stakeholders to agree on how technology should be governed. But we’re building on shared values of democratic governance and individual rights—and we’re beginning from the same premise: that innovation should serve a common good. To determine a common good, we should have common spaces.

Silicon Valley didn’t become Silicon Valley because California possesses some proprietary secret ingredient. It materialized because brilliant, ambitious people were physically clustered, exchanging ideas and inspiring one another. Proximity matters; it’s why universities still have campuses. If Canada and Europe truly want to achieve digital independence, we need shared spaces that bring talented people together, in person—imagine the Toronto Business Development Centre as a district instead of an office—and encourage the kind of intellectual cross-pollination that can change the trajectory of industries, and occasionally history itself.

I won’t say we should aspire to replicate Silicon Valley anymore than I would say we should hope for lightning to strike the same place twice. But we should be pooling our resources and fostering environments that encourage the best of us to collide with one another in unexpected ways. Europe has already spent decades building a network of startup hubs from Paris to Berlin to Warsaw. If bridges are built connecting our Canadian counterparts in Toronto, Waterloo and Montreal, we can create a roadmap to resilience that doesn’t pass through California, and we can address our shared concerns with the mindset that built Silicon Valley instead of the urgency that produced the Manhattan Project.

Jarek Sygitowicz is the co-founder of Authologic.

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