The federal government has committed $1.6 billion CAD to Canadian AI company Cohere, a move that likely represents its largest-ever federal equity investment in a single private tech company. The amount is part of a larger, planned Series E round and is triple the size of the Canadian Tech Growth Fund and nearly equal to the envelope the feds recently promised to all of Canadian VC. The investment follows Minister of Industry Mélanie Joly’s declaration that “We will build Cohere, and we will make it a Canadian champion,” and the feds’ AI strategy confirming their intent to help scale the country’s most promising AI firms by taking stakes in them. The decision has drawn reactions across Canadian society: tech leaders and nationalists have publicly celebrated the transaction as a win for the AI model maker and Canada’s sovereign tech ambitions, while policy wonks have questioned placing such a big bet on Cohere and whether government should be picking winners. VCs have questions about the terms of the deal, from what milestones Cohere must hit to what control mechanisms the deal gives the feds. AI Minister Evan Solomon told BetaKit that equity investments won’t be a one-off.