Economic Warfare?
Military innovation is irrelevant if we remain exposed to economic warfare
Alongside the annual GCXpo in Ottawa September 24, Communitech and Invest Ottawa are organizing a Tech for Defence Summit to spotlight the intersection of Canadian innovation and national defence.
Located within the GCXpo Defence Zone at Area X.O, the Summit will feature a full afternoon of programming focused on accelerating the adoption of dual-use technologies critical to Canada’s security landscape.
The Icebreaker is proud to be community partner of the Summit, and will be moderating a panel on Canada’s Defence Industrial Strategy. The Summit registration page is not yet live, but get in touch if you wish to attend!
🎯 Three-Shot Burst
Canada at Economic War
Canada is ramping up defence spending, but military power means little if we stay vulnerable to China’s decades-long economic warfare. A CIGI scholar argues that Beijing has infiltrated supply chains, stolen tech, and gained leverage over Western defence systems in the Canada at Economic War project.
Canada’s position in the new global order depends on hard choices. Align with allies, secure our economy, and invest wisely, or risk being isolated by the U.S. and targeted by Beijing.
Excerpt: “Beijing is perhaps best known for leveraging non-routine strategies and tools, often in ways that are covert or illegal (forced technology transfers, IP theft, etc.)… And at its most insidious, the CCP’s economic warfare weaponizes all sectors of Chinese society to execute its attacks: scientists are compelled to steal foreign IP for the benefit of the intelligence services; companies are forced to buy foreign assets coveted by the military; and cultural organizations are put to work advancing the regime’s foreign political interference activities. No sector or person is safe from being weaponized by the CCP, and insofar as China is an authoritarian state, compliance with its economic warfare program is non-negotiable.”
Reality check: Decoupling is now a strategic necessity, not a choice. Canada’s place in the new global order depends in large part on making reforms to meaningfully contest Beijing. Our natural resources, geographic distance from “hot zones” and deep interconnectivity with the U.S. — still the world’s single most powerful country — position us well to secure a place for ourselves.
Bottom line: If Canada pushes out hundreds of billions in new defence spending via modernized tech, before we shut the gate on economic warfare, will it simply have the effect of strengthening our adversaries?
Related:
Premiers call for improved relationship with China during trade war with the U.S.
In its relationship with China, Canada is behaving like an abuse victim: Stephen Nagy in the Japan Times
China’s record purchases of Canadian crude could be a harbinger of more deals to come
A Chinese research vessel returns to Arctic waters — and Canada is watching
US calls on DoD CIO to protect tech supply chain from influence of China: order comes after an investigation revealed Microsoft had been relying on China-based engineers to support DOD cloud computing systems
Canadians were promised a foreign agent registry — so where is it?
China’s strength in manufacturing comes from mastering the “electric tech stack”. Batteries, motors, power electronics, and chips that now power everything from drones to cars to robots
Shipbuilding, aerospace to be priorities in federal strategy to transform defence sector… Stateside, CSIS (the think tank!) announced that Jerry McGinn has been named the inaugural director of the new Center for the Industrial Base… Forging a Unified Defense Industrial Paradigm
📋 Procurement Update
Mapping the Canadian dual-use technology ecosystem
[Editor’s note: Thanks to the nearly 400 companies that have already taken the survey. It will remain open until August 1st]
Canada’s innovators are building world-class technologies. But too often, they fly under the government’s radar — we are often told that Canadian companies don’t have the necessary capacity to meet Canada’s defence needs.
Our first-of-its-kind industry survey, in partnership with the Council of Canadian Innovators (CCI), is your chance to put your company’s products and services on the government’s radar.
By sharing your insights, you’ll help us map the Canadian dual-use tech ecosystem and unlock new opportunities for collaboration, funding, and national impact.
If your company has technology that could be used in defence, please take 5 minutes to fill out the survey:
CCI and The Icebreaker will be sharing the information collected with the Government of Canada.
💾 Canada’s first Defence Tech Hackathon
September 20 at the DMZ in Toronto
The Icebreaker, in partnership with Build Canada and NordSpace, is excited to host Canada’s first defence tech hackathon.
The Defence Tech Hackathon is a catalyst to jumpstart a world-class ecosystem that builds sovereign capability in Canada. Our goal is to attract top talent, rapidly prototype real-world solutions, and bridge the gap between innovators and military end-users.
By forging new startups, building critical networks, and injecting a sense of urgency into defence innovation, this hackathon lays the foundation for Canada to compete and win on the global stage. We aim to advance the grassroots spirit of current and soon-to-be defence tech entrepreneurs.
We are still finalizing details, but here is what we know so far:
We will aim to rapidly prototype dual-use tech that solves real operational gaps for the Canadian Armed Forces
We are considering a challenge for a prototype platform that ingests multi-modal sensor feeds (satellite, UAV, radar, acoustic, etc.) and fuses them for real-time Arctic domain awareness
If you’re a software engineer who is defence-curious, this could be for you. We are looking for folks with domain expertise/experience in one or more of: defence, dual use tech (software and technology that can be used for both civilian and military applications), or Arctic operations; or who have any prior experience with multi-modal sensor fusion and real-time data platforms
🤝 Transatlantic Defence Innovation Partnership
The Icebreaker and the European Defense Tech Hub (EDTH) are pleased to announce a transatlantic partnership for dual-use and defence tech startups!
The European Defense Tech Hub (EDTH) and The Icebreaker have joined forces to accelerate defence innovation, uniting Europe's leading defence innovation network with Canada's foremost defence tech community.
Together, we are creating direct pipelines for startups to access operational trials, investor capital, and procurement across the Atlantic.
Founded in June 2024, EDTH is building an ecosystem of defence innovators across Europe. The organization has:
Run hackathons in half a dozen major European cities with over 420 participants forming more than 80 teams and tackling more than 100 real-world challenges sourced from the frontlines of Ukraine and our partners in the EU and NATO
Consistently seen 10-12 defence tech startups being newly founded or propelled forward through the hackathons
Launched a fundraiser together with DroneAid Collective to host drone-building workshops at all of its upcoming hackathons across Europe
Get in touch with us at readtheicebreaker@substack.com for details on how to participate in the partnership.
Related:
Closest to Europe: N.L. tech companies optimistic they'll see benefit from Ottawa's increased defence dollars
Red tape: Ukraine's deputy minister of defence for digital development argues that in modern combat, there's another frontline: the digital battle against bureaucracy… Great defence spending plan, Carney. It’d be a shame if Ottawa bureaucracy got in the way
⚔️ Combat Readiness
Lessons from Ukraine's Brave1 initiative
Friend of the Newsletter Dan Herman, documentary producer and former CEO of Ontario’s Intellectual Property agency, spent time on the ground in Ukraine recently. At the Icebreaker’s request, he’s written a first-person POV of what he saw. An extract is below:
When I first visited in the fall of 2022 to film what became Made with Bravery, the use of drones was limited to individual soldiers and volunteers turning to off-the-shelf DJI drones, transforming them into “weapons of war” for intelligence gathering and the unorthodox strikes on enemy assets, alongside foreign supplied drones.
Less than 3 years later, Ukraine’s defence tech cluster is a world leader in the development of UAVs (drones) and dual-use AI and communications systems. As Minister of Digital Transformation Mykhailo Federov notes, “two years ago we were importing these (tools), today…Ukrainian innovations (are raising millions).”
Key to this transformation was the creation of Brave1 in late April 2023. Structured as a cross-departmental platform, Brave1 brought together the ultimate users (and funders) of defence tech innovations on the battlefield with the innovators and researchers developing them.
Bottom line: More than just mapping what capabilities might exist, Brave1 created a reflexive system that, in near-real time, transmitted battlefield experience to the startups creating, and refining, the at-times unorthodox tools required. Since its start in 2023, Brave1 has become the largest funder of defence tech projects in Ukraine, issuing over 560 grants worth over 2.2 billion Ukrainian Hryvnia or $75 million CAD.
Having seen it work with drones and hardware, the government recently announced the creation of K4 Startup Studio to do the same for AI-powered technologies with applications in defence — putting $1M into AI defence startups and pairing them with front-line units for live combat testing.
As Canada looks to modernize its defence and security sector in the face of new threats, we should be looking to Ukraine and initiatives like BRAVE1 and K4 Startup Studio on how drones, AI and other new tech, developed by domestic startups, are at the forefront of the changing nature of war and defence.
Related:
Dan’s documentary on the resilience of Ukrainian startups, Made with Bravery:
Canada’s drone blind spot:
Big Beautiful…Deal?: Trump discussing drone ‘mega deal’ with Ukraine — as US tech lags behind adversaries: ‘The people of America need this technology’
Pearl Harbor: Ukrainian drone commander claims 4 Ukrainian FPV teams could turn NATO base into Pearl Harbor in 15 minutes without coming within 10 km
Sovereignty-as-a-Service: AirMatrix deploys Libra AI platform to Canadian Government through ISC, establishing "Sovereignty as a Service" for national airspace defence… We won’t let Americans buy our biggest bank. Why let them buy our biggest crypto firm?
Ground drones: TENCORE LLC, a Ukrainian producer of ground drones, received a $3.74 million investment from the American-Ukrainian fund MITS Capital
Supply side: New Russian drone made completely of Chinese components: Ukrainian Intelligence… Wars are won by factories before they are won on the battlefield
🍁 Canada’s Inaugural Defence Power 50 List
The Icebreaker is taking nominations for Canada’s inaugural Defence Power 50 List- until August 11. The list will recognize the most influential leaders and up-and-comers in the defence community who are critical to making the changes Canada needs.
The selection of this inaugural 2025 list is co-chaired by Erin O'Toole, Glenn Cowan, Philippe Lagassé, Sheldon McCormick, and Eliot Pence.
Bottom Line: Nominate someone we should know about today!
🔫 Hot Shots
Leg room: 60% of the global aerospace market is held by U.S. companies
Trouble in paradise?: European startups are having a rough time, with 1 in 4 German startups saying they could leave the country due to lack of capital. But not in defence, where German battlefield integration software startup Project Q raised €7.5m led by Project A… Russia’s number one terror drone was originally designed in Bavaria in the 1980s… DataTribe ranks the top VC firms in cybersecurity
EU/US deal: A key take away from the US-EU deal? The odds are high that Canada will agree to buy a lot of American military equipment as part of agreement… PM Carney says Canada’s trade situation with U.S. differs from that of the EU… Are Trump's tariffs 'driving the UK and Canada closer together'?… Inside the unfolding drama
Boom!: For the first time ever, we have armed and deployed an uncrewed Hammerhead maritime system with explosives during Exercise Trident Fury 2025
Royal Canadian Navy to retire eight warships before the end of the year
Weather bomb: The debate over climate change as national security heats up
Asymmetric Deterrence: IQT with part 3 of its blog series on aligning startups, investors, and government on new deterrence methods
Digitize: Canada needs to update its policy regime to realize its digital and defence ambitions… The cross fertilization of military tech with gardening and urban design/development in Renaissance Italy
Congrats: Valcom Tactical Communications celebrates its 70th anniversary. The Canadian company was selected late last year to supply the US Department of Defense with Tactical/Manpack Near Vertical Incidence Skywave antennas. The equipment is designed to ensure optimal short-wave communications under conditions where traditional line-of-sight radios might fail by bouncing radio waves off the ionosphere… International Test Pilots School announced a partnering agreement with SYPAQ Systems to combine remote pilot training with the evolving UAS market
Snooping: Microsoft has admitted that it can't protect EU data from U.S. snooping. In sworn testimony before a French Senate inquiry into the role of public procurement in promoting digital sovereignty, Microsoft could not guarantee that French citizen data would never be transmitted to U.S. authorities without explicit French authorization
Top flight: The Defense Innovation Unit (DIU) has named 10 finalists in the Counter-small Unmanned Aircraft System Low-Cost Sensing challenge launched in May… The Missile Defense Agency has released a draft solicitation for a $151B multi-award IDIQ for a multi-domain missile defence system (think Golden Dome architecture). Primes & startups onboarded to the vehicle will fight for contract dollars on individual task orders… Competition to supply parts of the Golden Dome is already heating up… Trump's Golden Dome missile-defence push on Canada leaves Ottawa with few good options
War Dogs: Jane Street boss says he was duped into funding AK-47s for coup
Mayday: The Pentagon has suspended participation in all think tank and research events until further notice. The Halifax Security Forum is singled out in the directive… A rundown on Fall 2025 defence events across Canada to bookmark in your calendar
Netflix and Chill: Last December, the agency responsible for IT services, Shared Services Canada (SSC), blocked access to paid subscription streaming sites, including Netflix, Hulu, Apple TV+, Prime Video, Disney+ and Crave for 45 government departments and agencies. The department with the highest streaming was the Department of National Defence at over three terabytes
Registration: Registration is open for the 2025–2026 Women in Defence and Security National Mentoring Program, which begins this fall
Don’t worry if I write rhymes, I write checks: How did a shift in procurement unlock billions in private investment? NASA didn’t just write checks — it rewrote the business model for space, Canada’s Alex MacDonald, former chief economist at NASA says:
Space: The critical link to Canada’s defence, sovereignty, and economic growth
Heretics and Heroes:
Department of miscellaneous: How undersea cables work
🤝 Meet the Defence Tech Community
The Icebreaker is hosting another meetup, this time on the West Coast
Defence Tech Patio Drop In, August 14 in Victoria, B.C.: Sign up here to join VCs, founders, operators, defence primes, and the defence-curious, over a few cold beers on a sunny patio.
🐸 Meme Warfare
If you’ve got battlefield intel, classified tips, or just want to call in an airstrike on our typos, hit “reply” and sound off. Whether it’s a new tech sighting, a rumour from the mess hall, or feedback on our comms, we want your SITREP.