Canada's venture capital industry is hoping that the U.S. trade dispute will prompt Ottawa to unlock more money for the country's startup ecosystem.

The big picture: Never let a good crisis go to waste.

Catch up quick: Trade talks between the allied neighbors fell apart late Friday night, just days after President Trump had announced a preliminary agreement.

• The U.S. then imposed 50% tariffs on certain Canadian imports, applying a novel mechanism, with Canada responding in kind.

What they want: The Canadian Venture Capital and Private Equity Association (CVCA) is asking its government to "immediately" launch a C$1 billion venture fund-of-funds program that already has been budgeted but hasn't yet begun accepting applications.

• Same goes for a C$750 million direct investment program to help fill the "early growth-stage funding gap."
• CVCA also wants revised treatment of startup stock -- namely something akin to the U.S. exemption for Qualified Small Business Stock (QSBS) -- arguing that "capital follows incentives."
• Finally, it's asking the government to include foreign commitments to Canadian VC funds as counting toward foreign Industrial and Technological Benefits obligations.

Why it might work: Canada is pretty pissed off right now, and thus might welcome any steps toward greater self-sufficiency.

What they're saying: "Prime Minister Carney told Canadians plainly that 'we cannot control the storm in Washington.' He is right," says CVCA CEO Benjamin Bergen. "What we can control is how we respond at this critical moment. The government should immediately deploy the capital already committed, create new opportunities to attract international capital beyond the United States, and be courageous in reforming our fiscal framework."

By the numbers: Canadian startups raised nearly C$2.7 billion in the first half of 2026, which was a 17% increase over the first half of 2025. Around 44% of that was for early-stage companies.

• U.S. investors participated in 28% of all Canadian venture deals in H1, up from last year but below the 2021 peak of 36.7%.

The bottom line: Canada's economy is, and forever will be, intertwined with the U.S. But that doesn't mean they must remain quite so tight.

Shein, the Chinese fast-fashion retailer, plans to raise up to around US$1.8 billion in its Hong Kong IPO. At the high end of its proposed range, the company would have a $26.8 billion market cap.

Why it's the BFD: This would establish Shein as one of the world's most valuable public clothing companies, but it's still a massive disappointment for many of its VC backers.

• Shein raised Series F funding in 2022 at a $100 billion valuation, but one year later raised at $66 billion — still well above IPO expectations.
• Participants in those deals included HSG, General Atlantic, Pan Pacific Capital, Brookfield Growth, and Tiger Global.
• Some of them will receive cash and/or stock compensation for the valuation slide, thanks to downside protections on earlier rounds.

Elsewhere: CFIUS reportedly is investigating Shein's agreement to buy San Francisco-based apparel retailer Everlane from L Catterton.

The bottom line: Shein, which scrapped earlier plans to go public in New York and then in London, has been hammered by U.S. tariff policy. Specifically the termination of a de minimis exemption for shipments below $800.

• In its IPO prospectus, Shein warns that it could soon face similar tariff challenges in Europe.

• Perplexity, an AI search platform, is in talks to raise strategic funding from Nvidia at a $30b valuation, up from a $20b valuation last year, per The Information. axios.link/4wOXwHk

🚑 Delix Therapeutics, a Boston-based developer of psychoplastogens, raised $85m in Series C funding led by J&J, per Psychedelic Alpha. axios.link/4zyP9lJ

• Quintessent, a Santa Barbara, Calif.-based developer of quantum dot laser technology for AI data center interconnects, raised $40m in Series A funding. Cycle Capital led, joined by Ciena, Goldman Sachs XIG-Industry Ventures, Hina Liberty Capital, Susquehanna International Group, InterVest, Safar Partners, Foothill Ventures, M Ventures, Osage University Partners, and Sierra Ventures. axios.link/4xhKoLT

🌎 Mantel Capture, a Cambridge, Mass.-based developer of carbon capture solutions for heavy industry, raised $18m in Series A extension funding led by Constellation Technology Ventures and Azimut Investments, per Axios Pro. axios.link/4y2Crdu

⚡ Boldr, a U.K. residential energy management startup, raised $5m led by Unconventional Ventures, with participation from Ada Ventures, Tetard Ventures, Davidovs Venture Collective, Roxbury Asset Management, Inclimo Climate Tech Fund, Prosegur, Techstars, and S20 Fund. axios.link/4xkw19y

• Kazimi, a German cybersecurity startup focused on bot activity in mobile marketing, raised €2.2m in pre-seed funding. Market One Capital led, joined by IBB Ventures. axios.link/4gstfrk

Apollo Global Management disclosed that hackers last month used a "social engineering attack" to access personal information.

• AirPro Diagnostics, a Rotunda Capital Partners portfolio company, acquired Revv, an OS for ADAS automotive repair workflows. axios.link/4zzl59z

⚡ Apollo is among those kicking tires on Shell's (NYSE: SHEL) U.S. chemical assets, which could fetch up to $8b, per the FT. Other suitors include ExxonMobil, LyondellBasell, and Kuwait Petroleum. axios.link/4y3TCeJ

⚡ ArcLight committed $1b in equity to launch a new transmission company called Anchor Point. axios.link/3UPNMis

• ATIS, a Thompson Street Capital Partners portfolio company, acquired AuditMate, provider of elevator asset management technology. axios.link/3SoJv4W

• E Source, an Align Capital Partners portfolio company, acquired Aneden Consulting, a Seattle-based interconnection and compliance firm. esource.com

🚑 Linden Capital Partners acquired ArtesRx, a Windermere, Fla.-based pharmacy business for complex patient populations, from Flexpoint Ford. axios.link/4qAHEXo

⚡ Nvidia (Nasdaq: NVDA) invested in Cloverleaf Infrastructure, a Houston developer of clean energy-based data centers whose backers include Sandbrook Capital and NGP Energy Capital. axios.link/4gxSYPp

• Waterland Private Equity is in talks to buy U.K. telco Gamma Communications (LSE: GAMA), which previously negotiated with Epris, Oakley Capital, and Providence Equity Partners. axios.link/4gKQnmp

No companies are expected to price IPOs this week on U.S. exchanges, although Japanese fintech Advasa is planning a direct listing on the Nasdaq.

• Alibaba (NYSE: BABA) will seek to raise around US$10.2b via a Hong Kong share sale. axios.link/4gfZA5Z

⚡ CoVolt Power, a Houston-based provider of construction services for utility-scale solar and battery storage projects, filed for an IPO that Renaissance Capital estimates could raise $200m. It reports $60.5m of net income on $739m of revenue for 2025 and plans to list on the NYSE (KVLT). Shareholders include Davidson Kempner and Man Group. axios.link/3Uel0bd

• YMTC, a VC-backed Chinese chipmaker, plans to raise around $4.9b in a Shanghai IPO. axios.link/4wHRtEk

🤗 Hugging Face, an open-source AI platform most recently valued by VCs at $4.5b in 2023, hired a bank to explore a sale for around $13b, per Business Insider. Backers include Lux Capital, Addition, and Salesforce Ventures. axios.link/4wNI2TR

• Partners Group is exiting its private credit investment in bubble tea chain Gong cha, which Bain Capital recently bought from TA Associates. axios.link/4qzykTC

• Vista Equity Partners is weighing a sale of Allvue Systems, a Coral Gables, Fla.-based data provider for asset managers and credit investors that could fetch up to $3b (including debt), per Reuters. axios.link/4qvpJBb

🏀 Marc Lore has agreed to sell his control stake in the NBA's Minnesota Timberwolves and the WNBA's Minnesota Lynx to Dragoneer founder Marc Stad at a $4.5b enterprise value. axios.link/4gR2T2P

• H.B. Fuller (NYSE: FUL) rejected a $1.2b bid for its building adhesives business from Ancora. axios.link/4xdDrvb

• Neura Robotics, a German developer of humanoid robotics that recently raised $1.4b in Series C funding, acquired Adlatus, a maker of cleaning and sweeping robots, from Ulm. axios.link/3URliVx

• Tata Consultancy Services of India agreed to buy MHP, an auto and industrial consultancy, from Porsche. axios.link/4xYybeH

• Virtu Financial (NYSE: VIRT) is weighing a sale of its agency brokerage and tech unit for between $3.5b and $4b, per Bloomberg. axios.link/3UgJjFp

• YipitData, a data provider for alternative investments, hired Goldman Sachs to find a buyer for between $2.5b and $3b, per PrivateEquityWire. It's raised over $500m from firms like Carlyle and Norwest. axios.link/4goEvVJ

The SEC charged Jason Satsky, a former BofA utilities banker, with insider trading in South Jersey Industries, ahead of that company announcing an $8.1b takeover agreement with JPMorgan Asset Management.

• David Fishman is leaving BofA to join JPMorgan as a vice chair and head of North American tech M&A. He succeeds Vineet Seth, who becomes vice chair of investment banking. axios.link/4ge25G3

• Russell Mason joined Moelis & Co. as a managing director of capital structure advisory. He previously was with Houlihan Lokey. axios.link/45JLofy

The value of biotech reverse mergers is surging, and is unlikely to abate given the deep pipeline of later-stage startups and decaying public shells.

• Abros Therapeutics, a non-opioid pain med startup co-founded by Ohio gubernatorial candidate Vivek Ramaswamy, is the latest example.
• On Friday it agreed to a reverse merger with Werewolf Therapeutics (Nasdaq: HOWL), after having raised $154m from RA Capital Management, Enavate Sciences, and Italy's Abiogen Pharma.