Canada invests billions in AI firm Cohere to bolster digital independence

CEO Aidan Gomez announced Thursday that the federal government will invest up to $1.6 billion in the Toronto-based firm, calling it “a vote of confidence in Canada’s ability to build world leading technology.” Prime Minister Mark Carney, speaking at the Canada-EU summit in Montreal, stated the investment would ensure “affordable, secure, sovereign AI, built in Canada for the benefit of Canadians.”

Cohere, which boasts a valuation of $36 billion and has over 60 investors including Germany’s Schwarz Group, NVIDIA, and Bell Ventures, has seen its customer base expand 20-fold in the past year to reach 300 clients. These include companies in highly regulated sectors like Aston Martin Aramco, RBC, Fujitsu, and TKMS.

The government’s investment will facilitate the creation of 1,000 new Canadian technology jobs and a $4 billion investment in research and infrastructure by 2031. While the exact percentage of ownership Canada will hold remains undisclosed, officials confirm the government will now have a voice in the company’s direction.

“This is a responsible investment done on favourable terms,” said AI Minister Evan Solomon. “It will allow the government and companies to keep their sensitive data – Canadians’ data – stored here in Canada under Canadian law.”

Cohere recently merged with Berlin-based Aleph Alpha in September to form a transatlantic AI solution designed to compete with companies like OpenAI and China’s DeepSeek. Experts suggest this investment provides an alternative to reliance on U.S. and Chinese AI, mitigating the risk of those nations using the technology for economic leverage.

Keith Jansa, CEO of the Digital Governance Council, praised Canada’s recognition of AI as critical infrastructure but cautioned that nurturing homegrown AI is only one aspect of achieving digital sovereignty. He emphasized the importance of control over infrastructure, data usage, and operational conditions. The government has also launched a $500 million growth tech fund to invest in smaller companies and secure additional equity stakes.