Who actually buys Canadian tech companies? Where do those buyers come from? And what happens after the deals are done?
Those are just some of the questions that business law firm Fasken set out to answer in its first-ever Exit InSights study, which analyzes more than 250 deal points from Canadian tech M&A transactions completed between 2019 and late 2024.
“I don’t think the data supports the idea that you need to move your company to the US to be sold to a US buyer.”
Will Shaw, Fasken
Fasken’s Exit InSights study was created to test whether the anecdotal patterns lawyers see when advising on Canadian tech deals actually show up in the data, and isolate the outcomes that are often shared anecdotally but rarely quantified.
Will Shaw, National Co-Leader of Fasken’s Emerging Technology group, has spent 15 years advising founders, scale-ups, and investors navigating the full company lifecycle.
In conversation with BetaKit, Shaw walked through three takeaways from the study that he believes are particularly relevant to Canadian founders thinking about exit strategy, buyer fit, and how deals may unfold in 2026.
“The default buyer isn’t American.”
A long-standing belief in Canadian tech holds that companies need to orient toward the United States in order to exit. Founders hear it early and often, and some even restructure their entire businesses around the idea that an American buyer represents the clearest path to a strong outcome.
Fasken’s Exit Insights Study points in a different direction.
Across the transactions analyzed, 52.5 percent of buyers were either based in Canada or outside the United States. US-based buyers accounted for 47.5 percent of deals.
“I was surprisingly encouraged by that data point,” Shaw said. “There’s actually more Canadian buyers than we give this ecosystem credit for.”
Unsurprisingly, US acquirers remained highly active, but Canadian companies also drew serious and sustained interest from both domestic and international buyers, often simultaneously.
A long-standing belief in Canadian tech holds that companies need to orient toward the United States in order to exit.
Shaw believes that exit strategies anchored too tightly to one geography can narrow future options around timing, value, and value retention.
“I don’t think the data supports the idea that you need to move your company to the US to be sold to a US buyer,” Shaw said. “The fact that US buyers show up in nearly half of Canadian exits, that indicates to me there’s a very well-worn path for Canadian companies to be sold to US buyers, but at the same time, the default buyer isn’t American.”
Shaw encourages founders to focus less on buyer location and more on preserving flexibility early to widen the range of potential outcomes.
“If deals are happening cross-border anyway, then the real question should be: how do you ensure that founders and employees retain more of their after-tax value?” he said. “How do you make sure that you get the best deal out of the sale of your business?”
Don’t sleep on strategics
Buyer geography is not the only area where the data diverges from common assumptions. Fasken’s Exit InSights Study found that 82.5 percent of Canadian tech exits involved strategic buyers, whereas private equity accounted for 17.5 percent of transactions.
Private equity often features prominently in conversations about tech M&A, and the split identified by Fasken cuts through recent conversations about private equity dry powder, which is recently estimated to top $1 trillion globally. And though private equity continues to play a meaningful role in Canadian tech, strategic acquirers remain the primary driver in M&A.
“Strategic buyers often pay a true premium, because there’s a real integration and platform rationale that a strategic buyer might have relative to a private equity buyer that’s often more financial metric-oriented,” Shaw said.
“Founders should think about maintaining relationships with prospective buyers the same way they think about maintaining a relationship with an investor.”
Private equity transactions often involve equity rollovers and a defined second exit window, according to Shaw. Strategic acquisitions, on the other hand, tend to centre on long-term product integration and team continuity.
“We’ve had clients, for example, where strategics have brought them in and the founders become the AI experts in the company,” Shaw added. “As the strategic is reinventing itself to some degree, the founders play a really important role in the management team of that strategic.”
The dominance of strategic acquirers in Canada also influences how founders should prepare for an eventual exit.
“You have to understand what kind of buyers you’re building for and who is going to be most interested,” Shaw added. “Founders should think about maintaining relationships with prospective buyers the same way they think about maintaining a relationship with an investor.”
The same logic applies to advisor selection. A sale process focused only on financial sponsors can miss opportunities where strategic alignment drives bigger payoffs.
“If you want the best outcome, you need advisors who understand the strategic landscape in Canada, in the US, and internationally,” Shaw said.
Exits don’t happen in isolation
Some of the most consequential factors connected to Fasken’s Exit InSights Study sit just outside the data. By documenting successful periods over a five-year period, the report has set an important benchmark for the health of Canada’s exit market, offering a lens through which to view emerging risks in the ecosystem.
The question Shaw returns to frequently is who will still be building in Canada five years from now. He pointed to a recent figure from a Leader’s Fund survey showing that only one third of high-potential startups created in 2024 remained headquartered in Canada in 2025.
“To me, that’s an existential issue that we as an ecosystem need to be paying attention to,” he said.
Exit data depends on who remains in the country long enough to exit. If companies relocate, or Canadian founders build elsewhere, “we just won’t see those as part of the data point through a study like this,” Shaw said.
Fasken’s Exit InSights report captures what a functioning Canadian exit market looks like in practice. The question is how big that market is in the next five years.
“We’re at the beginning of the next real super cycle for tech,” Shaw said. “I think we want to capture as much of that as possible in Canada, so I think it’s really important that we incentivize founders to stay here.”
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Fasken’s Exit Insights Study maps how Canadian tech deals get done. Access the full report here.
Feature image courtesy ___.