The Bengio brothers had a busy week.
Samy Bengio co-published a paper with his Apple colleagues that throws cold water on the capabilities of large-reasoning models like OpenAI’s o3 and Anthropic’s Claude 3.5.
The findings? Reasoning models were outperformed by traditional large-language models (LLMs) on simple tasks, start thinking less as problems get more difficult, and can’t be relied upon to execute algorithms or reason consistently. Oof.
New York University professor emeritus Gary Marcus, who recently spoke about the limitations of LLMs at Web Summit, said the algorithm issue effectively kills the chances of them being a direct route to artificial general intelligence, or AGI.
There’s no formal definition of AGI, but it’s the thing most of the foundational AI companies are hoping to achieve: a tool that equals or surpasses human intelligence for almost all tasks.
Samy’s brother, Turing Award winner and Mila founder Yoshua Bengio, has been highly motivated by the race for AGI, but perhaps not in the way you might expect from one of Canada’s AI godfathers.
While AGI has yet to arrive, and the current crop of AI agents might fail to reason, Yoshua argues they’re already quite good at blackmail, cheating, and self-preservation. Like Marcus with LLMs, Yoshua has warned for some time about the risks of agentic AI.
He’s also doing something about it, launching a new AI safety research organization called LawZero. The goal is to create a non-agentic “Scientist AI” designed to understand and predict instead of act. Something that could support humans in the completion of important tasks rather than replace them.
In this endeavour, Yoshua might run into the same reasoning issues his brother Samy is currently exploring. But I’m glad that the elder sibling is following his own advice and making active choices to help determine a brighter AI future. The alternative is unreasonable.
Douglas Soltys
Editor-in-chief
Land your pitch at Startupfest and take home hundreds of thousands of dollars in investment prizes.
Over the past 15 years, Startupfest has become known for the game-changing opportunities that are available to startups. With high-impact networking, expert mentorship, world-class content, and an ever-growing list of prizes, it’s no wonder they’re a must-attend event for founders.
Diana Virgovicova and Shirley Zhong, founders of Xatoms, triumphed at Startupfest 2024, winning 3 investment prizes and taking home $250,000. Looking ahead to this year’s edition, Diana urged other founders to try for the same: “The Startupfest investment literally changed our lives last year–I highly encourage you to participate.”
This year, for their 2025 edition, Ambition+ Startupfest is rolling out more opportunities than ever before. Expect to see new prizes, expanded mentorship, exciting content, and all the magic of Startupfest this July 9-11th in Montréal.
Learn more & register for Startupfest here.
Alberta’s tech sector is embracing an AI data centre boom. Will it pay off?
Alberta’s technology and innovation minister, Nate Glubish, has been vocal about his desire to make Alberta the premier destination for AI data centres. He says this will make Alberta more attractive for AI companies looking to set up shop and make access to AI compute more affordable and reliable.
“Alberta aims … to be the host jurisdiction of that ripple effect of technological advancement in every industry,” Glubish told BetaKit in an interview.
While local tech leaders say AI data centres would provide a boon to the Alberta tech ecosystem, the proposed multi-year projects could potentially strain the province’s electrical grid and significantly drive up carbon emissions.
American chip giant AMD to acquire Untether AI team
Toronto-based AI chipmaker Untether AI has ceased supplying and supporting its products and entered into “a strategic agreement” with Advanced Micro Devices (AMD).
Untether AI announced the AMD deal and its shutdown yesterday in a brief blog post that indicated its team would be joining the American semiconductor giant and Nvidia rival. The exact details and financial terms were not disclosed.
Industry watcher says recent Shopify ruling could embolden companies to challenge CRA data requests
Last week, the Federal Court of Canada sided with the e-commerce giant against the Canada Revenue Agency by dismissing a request compelling Shopify to turn over information about Canadian merchants who use its software.
According to one tax industry expert, Shopify’s win in its two-year fight against Canada’s tax authority could encourage other companies to challenge similar requests to provide client data.
As aging entrepreneurs retire, BDC and FNBC announce $100 million to help Indigenous groups buy their businesses
The First Nations Bank of Canada, an Indigenous-owned national bank, and the Business Development Bank of Canada (BDC) have announced a $100-million CAD joint initiative to help Indigenous communities and economic development agencies finance the purchase of established businesses.
In an interview with BetaKit, BDC president and CEO Isabelle Hudon described this initiative as a step towards economic reconciliation, which the Government of Canada-owned Crown corporation hopes to do more to facilitate.
American gig giants Instacart and Uber add Canadian executives to top leadership positions
American gig economy giants Uber and Instacart have recently elevated the Canadian executives in their ranks to higher leadership positions.
Instacart tapped Chris Rogers, a Wilfried Laurier University alumnus and former Apple Canada leader, to replace outgoing CEO Fidji Simo. Meanwhile, Uber promoted its Toronto-based senior vice-president of mobility and business operations, Andrew “Mac” Macdonald, to president and COO.
The promotions coincided with an active week of C-suite switch-ups in Canadian tech, including CarbonCure and VerticalScope, which both shifted their founding CEOs to board roles.
Investissement Québec records annual loss on VC and fund investments
Provincial investment agency Investissement Québec (IQ) reported a 4.9-percent loss on its direct venture capital and indirect fund investments last fiscal year, reflecting market volatility and struggling fund performance.
According to its annual report for the year ended March 31, IQ recorded 0.3 percent returns, or roughly $13 million, coming in well below Finance Minister Éric Girard’s forecast of $194 million.
Former Raptors star Jerome Williams newest teammate of community connector Swiirl
Toronto and San Francisco-based startup Swiirl is teaming up with NBA legend and former Raptor Jerome Williams (also known as the Junk Yard Dog or “JYD”) on a new campaign called Shooting for Peace. The non-profit educational program is designed to bring financial literacy and mental health and wellness education to students across Canada and the United States.
Xanadu touts another advancement toward scalable quantum computing
Toronto-based Xanadu says it has edged closer to solving two of the hurdles plaguing the quantum industry: eliminating errors and scaling.
The quantum startup announced that its researchers have created a quantum chip with error-resistant photonic quantum bits (qubits), or the basic units of quantum computing, for the very first time. The development forges a viable path toward a useful and scalable quantum computer, the company said.
Women-led startups sweep first Pitch competition on stage at Web Summit Vancouver
Web Summit Vancouver wrapped up on May 30 with its first Pitch competition, and all three early-stage startups on stage were founded or co-founded by women based in Vancouver.
Web Summit’s organizers claimed the competition reflected a “remarkable rise” in women’s involvement since its women in tech program launched in 2015, stating that 44 percent of participating startups this year had one or more female founders.
FEATURED STORIES FROM OUR PARTNERS
Finance leaders have become quiet forces behind startups’ growth strategy, pushing for clarity and spotlighting hard choices and tradeoffs. That was the message from leaders at Clio, Float, and Hiive brought together for Scaling Realities: An Honest Conversation on Growth in the Post-Boom Era, hosted by Float and BetaKit on the opening night of Web Summit Vancouver.
Scaling today means closely considering financial implications of each decision, and having a strong financial team is more essential to that process than ever. Read about how these leaders are turning complex markets into growth opportunities.
🇨🇦 Weekly Canadian Deals, Dollars & More
- SF – Canada-founded AppDirect acquires Broker Online Exchange
- MIA – Canada-founded Rails raises $19.1M for crypto platform
- CAN – DIGITAL invests $15M across 16 AI-focused work projects
- CAN – Google allocates $13M to strengthen Canada’s AI workforce
- VAN – Fispan closes $41M in secondary-heavy round
- VAN – Urbanlogiq expands AI government data platform
- CGY – Eavor secures at least $89M from Canada Growth Fund
- SK – Balatro wins at 2025 Apple Design Awards
- KW – ApplyBoard lays off employees as immigration policies shift
- TOR – Portless raises $24.7M to help retailers weather trade war
The BetaKit Podcast – Amii CEO Cam Linke says Canada’s AI strategy requires customers
“Be a customer of Canadian startups. This is the thing that every company needs. Nobody died from having too many customers.”
The CEO of the Alberta Machine Intelligence Institute, Cam Linke, joins to discuss the next phase of the Pan-Canadian AI Strategy and how Amii stands apart from other national AI institutes, Vector and Mila. Recorded live from the Upper Bound AI conference.
Take The BetaKit Quiz – This week: Trump vs. Musk, Shopify vs. the CRA, plus a Raptor’s assist
Think you’re on top of Canadian tech and innovation news? Time to prove it. Test your knowledge of Canadian tech news with The BetaKit Quiz for June 6, 2025.
Take a peek inside the new Communitech Hub
Communitech is opening its doors to unveil its new space. A newly reimagined space built to spark innovation, connection and growth in the heart of Waterloo Region’s tech ecosystem.
On June 18, founders, partners, and community members are invited to explore the refreshed space. Expect local eats, great conversations and a chance to connect with the people building the future of tech in Waterloo Region.
This is more than a tour. It’s the start of what’s next.
Feature image courtesy LawZero via LinkedIn.