Karsten Wenzlaff, Advisor
August 26th, 2025
Karsten Wenzlaff is a Crowdfunding and Fintech Expert from Germany. He is Secretary-General of Digit[...]
U.S. Bold Bet on Chips and the Intel Lesson for Canada
Semi Conductor Chips | Aug 25, 2025
Image: Freepik/xb100
On August 22, 2025, Intel announced a historic investment deal with the U.S. government. Washington will convert $8.9 billion of grants from the CHIPS and Science Act and funds awarded under the Secure Enclave program into an equity stake. That adds up to $11.1 billion when combined with earlier support. The U.S. will own almost 10% of Intel through the purchase of 433 million shares at $20.47 each with a five year option to buy more if Intel’s foundry control slips. Intel’s stock rose 5% after the news showing market confidence. The U.S. deal fuses industrial policy, national security, and capital markets.
What This Could Mean and the Risks Ahead
If Intel executes with strength this deal could become a model for other strategic industries where similar partnerships could emerge, such as in cloud computing, artificial intelligence, and cybersecurity. The U.S. is treating advanced technology as a matter of national security and economic resilience, not just market growth.
See: U.S. Brain Drain and Implications for Canadian Fintech
But the risks are serious given that preferential government equity can tilt markets. Even without board seats, U.S. national security priorities are likely to influence Intel’s decision-making. Analysis from the WSJ (subscription) spotlights concerns that allies could see this move as protectionist while competitors like China are doubling down on their own state programs. For Intel, receiving public investment capital does not eliminate technical and competitive challenges.
Canada at a Crossroads
Canada shouldn't miss this message. Our economy depends on digital infrastructure, fintech, and artificial intelligence, yet we are slipping in the basics. Labour productivity fell 1.8% in 2023, the worst among OECD countries according to OECD data. Business R&D intensity has stalled even as total spending reached $53.1 billion in 2023. The Toronto Stock Exchange has seen a collapse in new listings, with the number of operating companies falling 42.5% since 2008. In the first half of 2024 there were only 12 IPOs raising $12.9 million, the weakest in decades.
Retail investors have limited options in Canada with current crowdfunding rules cap issuers at $1.5 million per year and individuals at $2,500 per deal per CSA's NI 45-110, while American policy leaders are advocating to increase U.S. crowdfunding caps from $5M to $10M USD. Meanwhile, open banking is still not live with the government targeting early 2026 for rollout. Canada needs to recognize that leading economies are treating technology as sovereign infrastructure. But our record with national large scale projects from broadband and digital ID to defense procurement is often delayed, underfunded, or misaligned with the original vision.
What Canada Can Do
Canada must respond from a position of strength while recognizing its constraints.
Capital formation is a constant constraint. IPO markets remain weak and the pool of listed operating companies continues to shrink. Without deeper domestic pathways, Canadian innovators will keep looking south. Retail access must expand. Current equity crowdfunding limits are too modest for capital intensive sectors like AI infrastructure, semiconductor packaging, and cybersecurity. Modernize equity crowdfunding and exemption rules to turn Canadians into shareholders in their own innovation economy, not passive taxpayers.
Competition must be unlocked. Canada’s banking market remains highly concentrated, and the continued delay of open banking weakens fintech growth compared to peers already live. Accelerating the rollout with clear liability rules and payments initiation is essential.
See: Accelerating Financial Innovation and Access in Canada
Semiconductors require realism. Canada is not building leading edge fabs, but we already host a North American advanced packaging hub at IBM Bromont. Ottawa and Quebec backed upgrades in 2024 and further support is expected. Packaging is becoming a chokepoint as chiplet designs spread across AI systems. Doubling down on this strength could anchor Canada in the supply chains funded by U.S. CHIPS investments.
Intellectual property must be treated as a strategic asset. Canada has a long history of world leading research that too often turns into patents and companies controlled abroad. In AI, for example, Canadian researchers pioneered deep learning yet most of the firms capturing that value are headquartered elsewhere. A national IP strategy that ties public research funding to commercialization in Canada, strengthens IP retention rules, and helps scale ups build patent portfolios would keep more value at home.
Public funds should be linked directly to domestic value creation. The Intel deal shows how governments can require alignment with national goals in exchange for capital. Canada can do the same, not by choosing a single corporate champion but by tying support to measurable outcomes like higher R&D intensity, Canadian patent filings, and stronger Canadian controlled firms.
See: U.S. Tax Bill Could Drive Capital Back to Canada
Talent and immigration must become a growth engine, not just a safety valve. Canada’s immigration system is a global advantage but skilled newcomers too often become employees of foreign firms rather than founders of Canadian ones. Scaling visa programs tied to entrepreneurship and improving access to early stage capital for immigrant founded companies would unlock more homegrown innovation.
Why It Matters for Canadian Competitiveness
The Intel deal shows the world is changing fast. Countries are treating technology as a national asset. Canada must act too, but in our own way. We can rebuild competitiveness not through giant one off bets but by modernizing capital markets, opening doors for retail investors, and backing the companies that will define our digital future. It is a call to seize our strengths and trust Canadians to invest in them. If we act now, Canada can remain a competitive, innovative, and inclusive player in the global economy.
The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, artificial intelligence, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org
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