Back when I worked at a Canadian startup and had to do SRED paperwork I got the vibe that it was more about companies that could afford to hire SRED consultants than it was actual research and dev. Heard stories about web dev / media shops milking SRED, while I saw people doing actual foundational engineering struggle (nor could they waste the time filling in the paperwork).

This was over a decade ago. Did not come away with a positive impression of the tech startup scene in Canada. Yours and other comments since have only fed that.

... I want to disagree with this, but it lines up with my own experience. My work was being presented for similar grants with very flimsy justifications. Not pure web work but it wasn't exactly foundational research either.

I too have seen this as a past entrepreneur in Canada. A lot of accountants are in on misrepresenting SR&ED tax credit applications and will attempt to find the "research" in regular IT work. They will even do the technical writing and filing work for free, while taking a commission of the take when the tax credits roll in (free money). There is a whole segment of startups propped up by SR&ED. I've seen many doing innovative work with a sound business plan, using that money to get to profitability, and it's great they were able to get funding, but a lot of others milked the system fraudulently, using SR&ED consultants to continue to exist when they should have failed.

> We also looked at government tech subsidies and grants. Honestly, there is so much paperwork that takes time away from gaining customers and growing the business.

I wonder how that compares with, for example, joining an YC batch, or talking to multiple VCs in search of financing

did you consider any of the service offerings that do this paper work e.g. SRED?