Hello to Canada’s SaaS and AI Community,
Budget 2025 has formally kickstarted a national defence tech push, with roughly $81 billion in new funding for the Canadian Armed Forces and a dedicated $6.6 billion Defence Industrial Strategy meant to grow a domestic defence industrial base.
Layered on top is a new Buy Canadian policy, the forthcoming Defence Industrial Strategy, and BOREALIS (a new bureau to build sovereign AI and quantum tools for defence). For founders, this isn’t just macro policy. It’s a demand signal.
At this years SAAS NORTH, Dominion Dynamics founder & CEO Eliot Pence joined Douglas Soltys, Founder & Editor-in-Chief at BetaKit, to unpack what this shift means for Canadian builders.
Eliot’s view: defence tech is both an economic multiplier and a “generational opportunity” for entrepreneurs willing to build for mission-critical problems.
Key takeaways:
- Canada’s decades-long underinvestment in defence has created a massive capability gap and a correspondingly large market for new tech.
- Defence is an “invention industry” with outsized spillover benefits for SaaS, AI, and data infrastructure.
- Modern defence problems look a lot like hard SaaS problems: decision support, workflow, autonomy, data integration.
- Success requires a mission-first mindset; defence can’t be treated as a “nice to have” revenue line.
- New federal policies, Buy Canadian, BOREALIS, SME-focused procurement, are aligning with founders’ push for sovereign, scalable Canadian companies.
Co-Founder/Producer, SAAS NORTH Conference Editor, SAAS NORTH NOW
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When Eliot Pence stepped on stage in Ottawa, he didn’t sugarcoat the state of Canadian defence or the size of the opportunity in front of founders.
“We spend less than one company in the entire NATO alliance on equipment as a percentage of our overall defence spend, and we have less soldiers per capita than any other country in the NATO alliance. The opportunity set is immense in large part because we haven’t invested in defence for now 30 years,” he said.
For SaaS and AI-native companies, the question isn’t whether defence tech matters, it’s whether you’re prepared to build for it.
Defence As An “Invention Industry”
Eliot pushed back on a common assumption: that defence is a zero-sum trade-off against other priorities.
“One of the things that I don’t think most Canadian citizens get… is the defence industry is really an invention industry,” he said, pointing to an RBC report showing that defence’s economic multiplier is roughly three times that of manufacturing. “If you look back at history, most critical inventions from the internet to Teflon to spandex were because of the defence industry.”
Recent Canadian analysis backs this up. RBC and others have highlighted that increased defence spending (if tied to domestic industry) can drive sizeable gains in output, jobs, and R&D far beyond the sector itself.
For SaaS founders, that matters. Defence isn’t just another vertical; it’s a forcing function for hard technical problems that later generalize into commercial products.
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“We’re Secretly Building A SaaS Company”
Dominion Dynamics is best known for Arctic surveillance and sensor networks. In practice, that translates into a lot of software.
“We’re building the autonomy stack for the Arctic,” Eliot explained. That includes a mesh network for Canadian Rangers covering vast northern patrols, turning previously uncaptured data into models and prediction engines.
Under the hood?
“We’re secretly building a SaaS company… so much of what we’re doing is software. It’s AI, its building models, it’s building ontologies, it’s building prediction engines. It’s building visualisation engines that make the war fighter’s life easier.”
For SAAS NORTH attendees, the pattern is familiar:
- ingest messy, distributed data
- normalize, model, and visualize
- drive better decisions and actions
The difference is the customer: a war fighter, not a sales team; Arctic patrols, not warehouse routes.
Where SaaS Builders Plug In
Eliot outlined three immediate entry points where SaaS and AI companies can credibly play:
- Decision analysis and support, tools that help commanders and operators make better decisions from complex data streams.
- Workflow and process automation, especially around clearances, procurement, and multi-stakeholder coordination.
- Autonomy and remote control, operating systems, interfaces, and control logic for devices in low-bandwidth, high-risk environments.
Crucially, he argued that the technical challenges are not wildly different from enterprise SaaS.
“I don’t think they’re that different,” he said of defence vs. commercial buyers.
“The different is the psychology of the entrepreneur. You can’t see it as a nice to have… you have to be committed to the mission because you’re dealing with life or death circumstances.”
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Dual Use, Mission Focus, & The Reality Check
Government often talks about dual-use tech: tools that work for both commercial and defence customers. Eliot didn’t dismiss the concept, but he did reframe it.
“I think the term dual use is a gateway drug… once you get in it, you realise, oh, I need a security clearance. I need the trust of the war fighter. I need to understand why that data can’t mesh with that data.”
His warning to SaaS and AI founders:
- Don’t treat defence as a side-quest or white-labeled add-on.
- Expect to invest heavily upfront before revenue.
- Build trust with end users who operate in genuinely high-stakes environments.
Half of Dominion’s team are veterans, an intentional choice to anchor product decisions in lived operational reality.
Sovereignty, Buy Canadian & Building A “Defence Prime”
Eliot was blunt about Canada’s current dependence on foreign suppliers:
“What we want to be is the first Canadian defence prime. Too many American subs dominate this market. 80% of what we buy is from American companies. We want to reverse that.”
Budget 2025’s Buy Canadian policy and defence industrial strategy are explicitly aimed at shifting that ratio, tying billions in procurement to domestic capabilities wherever possible.
For SaaS companies, this could mean:
- more competitive access to federal contracts via SME-focused procurement programs
- multi-year strategic partnerships, not just short pilots, for companies that can execute
- a clearer path from Canadian reference customers to exports across the NATO alliance
“I’m not interested in just building just for Canada,” Eliot said. “I’m interested in building a Canadian company with Canadian values that spreads that around the world. We need more of that.”
Talent Repatriation & The “Generational Opportunity”
Having worked in U.S. defence tech and venture, Eliot has a clear view of Canadian talent abroad:
“The most talented people I’ve ever worked with are Canadian… I wrote this piece called The Canoe and the Crown. I got 2000 LinkedIn inbounds from Canadians that are desperate to work for a company that has a mission of transforming the country.”
Defence (combined with Canada’s broader AI and deep-tech push) creates a mission that can pull those people home.
“This is a generational opportunity for entrepreneurs. We’re about to spend both a tonne of money, but aside from the money, you have a chance to change a country.”
Tactical Questions For SaaS & AI Founders
If you’re a founder or operator reading this, a few practical questions to ask your team:
- Do we solve a decision, workflow, or autonomy problem that maps to defence use cases?
- Are we willing to commit real roadmap and leadership attention to a mission-driven, complex customer?
- Can we operate within higher security, compliance, and procurement requirements without derailing the rest of the business?
- Where could we partner (with primes, startups like Dominion, or government) to accelerate learning?
Defence tech won’t be the right move for every company. But for those prepared to make the leap, this moment (policy, capital, and mission all aligned) may not come around again soon.
What to Expect At SAAS NORTH 2025
Jo’s session, From CX to AI Agents, will take attendees behind the scenes of HTS’ transformation, from rule-based chatbots to fully autonomous systems processing millions in transactions. Expect a candid discussion on what works, what doesn’t, and how to build AI that actually earns customer trust.
While many companies are still experimenting with generative AI, HTS (Hopper Technology Solutions) systems are already delivering measurable ROI at scale. At SAAS NORTH 2025, Jo will share the frameworks and lessons that got them there.
SAAS NORTH is Canada’s hub for scaling SaaS and AI companies. Founders, teams, and investors come to learn, connect, and grow with the country’s largest in-person tech community.
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