Cyber Firm Tailscale Uses Canada Roots to Court Clients Wary of US Power

Cybersecurity company Tailscale Inc. says it’s trying to use its Canadian identity as an advantage to win business from governments and enterprises concerned about American AI security.

The Toronto-based company, which offers technology for virtual private networks, is making a multimillion-dollar push to build sovereign, on-premise versions of its networking software, and is concentrating development in Canada and Europe.

The company has hired Patricia Prewitt, a former manager at Google X’s Moonshot Factory, to lead its sovereign artificial-intelligence push and plans to add at least 50 more people for the project, with the majority of those jobs in Canada.

“It started to become a real advantage to emphasize that you’re a Canadian company,” Chief Executive Officer Avery Pennarun said in an interview. “You start going into Europe and they’re like, ‘I will buy anything, but not American technology.’”

US President Donald Trump has antagonized allies such as Canada with tariffs and threats to their sovereignty, and some countries are working to reduce their reliance on the US for trade, technology and security. Tailscale is trying to tap into anxiety about overdependence on US-based AI services and cloud platforms, such as those sold by Anthropic PBC and Alphabet Inc.

In June, Anthropic temporarily suspended access to leading-edge models Mythos 5 and Fable 5 after a US government directive to prohibit the use of them by foreign nationals. Although the ban didn’t last long, the move highlighted the power of American authorities to cut off companies and governments outside the US from AI services.

“It’s amazing to just be able to walk into a conversation and not scare people because Canada is small and we’re never going to be the monopolist that crushes your country,” Pennarun said.

Read More: Trump’s Anthropic Crackdown Sets Off AI Alarms for US Allies

Tailscale already serves as the network layer for many AI companies, but demand from sovereign data center builders in Canada, Europe and Asia nudged the company toward developing independent, self-hosted deployments where customers maintain full control.

The company’s engineers will work directly with its customers during implementation, marking a return to a more traditional approach to software, Pennarun said.

Tailscale’s revenue has more than tripled since it was valued at around $1.5 billion last year.