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Why Vancouver Is Becoming North America’s Next Big Tech Scene

July 25, 2017, 2:00 PM UTC

Christy Clark was kind enough not to mention the U.S. or its new President by name—at least not at first. But with talk of “Muslim bans” and H-1B visa restrictions swirling, the British Columbia Premier’s message to companies both Canadian and American was unmistakable: If the U.S. won’t welcome the world’s brightest engineers and programmers, so much the better for Canada.

“While other countries are looking in, let’s be a country and a province that is looking out,” Clark said to a packed convention hall at the BC Tech Summit, Vancouver’s biggest tech industry confab, held in March. “[One] that is reaching out to the world, that is building bridges to the world, that is welcoming people in—the best and the brightest from every corner around the globe.”

The Trump administration’s rigid stance on immigration policy—in particular its tightening of restrictions around H-1B visas for skilled foreign workers—has created a unique opportunity for countries to lure away top technology talent that would otherwise seek employment in Silicon Valley or elsewhere in the U.S. Many of those workers now field competing overtures from countries like China, Mexico, France, and ­India, in some cases finding themselves pushed toward the very countries Trump has accused of stealing American jobs.

A bird’s-eye view of Stanley Park in Vancouver. Locals refer to the core of the city as “the coast.”David Nunuk — Getty Images/All Canada Photos
David Nunuk — Getty Images/All Canada Photos

But with its proximity to technology hubs like San Francisco and Seattle, Canada’s western province—and in particular Vancouver, its picturesque urban center—could have the most to gain from its national neighbor’s newfound isolationism. Both government and industry are moving to seize the moment.

BC’s advantage is more than geographic. Homegrown Canadian tech heavyweights like Shopify (SHOP), Kik, and Hootsuite anchor what is already a robust technology and venture capital scene. (Workplace collaboration darling Slack was founded in Vancouver in 2009 before migrating to Silicon Valley.)

Coupled with Canada’s comparatively relaxed immigration policies, the country’s tech sector has long drawn interest from major American technology giants that need foreign talent but are constrained by the historically unpredictable nature of U.S. immigration policy. Facebook (FB), Boeing (BA), Microsoft (MSFT), and Amazon (AMZN) all have offices in Vancouver, filling them partially with foreign workers on temporary visas who can then collaborate with colleagues in California and Washington State.

British Columbia’s wooing of foreign tech workers turned away by the U.S. is nothing new. Over the past decade, employment of skilled technology workers in BC has grown 27%, driven partly by U.S. companies frustrated with their own government’s limit on visas for skilled workers. (Microsoft, headquartered not far to the south in Redmond, Wash., has been in Vancouver since 2007.) BC’s provincial government has made a concerted effort to make it easy for U.S. tech companies to open offices in Canada, providing financial incentives and working with the federal government to expedite visas for skilled foreign workers.

It’s a model that Canada is now codifying at the federal level. In June the Canadian government implemented a package of immigration reforms, known as the Global Skills Strategy, aimed at fast-tracking visas for skilled foreign workers—some can get processed in as little as two weeks—and providing a concierge service that will walk companies through the process of opening an office on Canadian soil.

Related: Montreal and Toronto Are Becoming Magnet Cities for Tech Giants Google, Microsoft, and Uber

Still, BC is finding ways to differentiate itself. Clark has floated the idea of a “doctorate-for-citizenship” program, which would guarantee Canadian citizenship to individuals on the very day they receive a Ph.D. Earlier this year, the province expanded a tax credit for virtual and augmented reality companies that move to the province. The added incentives for VR and AR companies is no accident, says Amrik Virk, BC’s former minister of technology, innovation, and citizens’ services. While there’s already a global capital for finance (New York), for auto manufacturing (Detroit), and for software engineering (the San Francisco Bay Area), there’s not yet a global capital for VR and AR, he says—at least not yet. Vancouver has already stolen the spotlight from Los Angeles in film production, and it could go for the global crown in this category too.

It’s still too early to assess just how much a more restrictive U.S. immigration policy will hurt U.S. tech companies or benefit tech economies elsewhere, says Michael Tippett, cofounder of True North, a firm that specializes in helping tech companies set up offices in Canada.

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“These discussions are happening in the boardroom,” he says. “Your investors are not content for you to sit still. So they’re looking strategically: If I’m going to open up a new office with a hundred people, where’s it going to be?”

Canada is betting that companies will look beyond Silicon Valley for places where they know their talent pipeline won’t be curtailed. While Canada’s immigration system isn’t perfect, Clark noted in her BC Tech address, it does create space for tech firms to acquire talent. That could prove a key advantage not just for businesses but for Canada’s tech industry itself, which has already seen so many of its own brightest minds gravitate south toward Silicon Valley for years.

A version of this article appears in the Aug. 1, 2017 issue of Fortune with the headline “Just Call It Silicon Coast.”