Vancouver-based Dream Photonics is hoping its technology can help solve a key manufacturing bottleneck in the rapidly growing AI and data-centre industry, while giving it a foothold in a market worth billions of dollars.

It recently won the $110,000 top prize at the 2026 New Ventures BC Competition, which recognizes early-stage startups in B.C.

“It’s been a long journey for the team, and so this prize is a valuable recognition of the team and the business model that we’re pursuing, and the customer traction that we have,” Lukas Chrostowski, chief executive officer and co-founder of Dream Photonics told TechNX in an interview.

The firm, which was founded in 2019, was recognized for PICTOR, a technology that uses 3D-printed micro-lenses to automatically connect optical components during the manufacturing of computer chips.

Beginnings at UBC

It all started at the University of British Columbia (UBC), where Chrostowski joined the faculty as a professor 20 years ago. His background was in lasers and photonics, which the National Research Council of Canada describes as “the science and application of light.”

Chrostowski met his co-founder, Sudip Shekhar, while Shekhar was at Intel. Shekhar joined UBC in 2013. "The research that we were doing was directed towards where can we have impact in the optical communications and semiconductor world,” Chrostowski said.

They spent about 10 years researching how to merge electronics and photonics.

“We had a lot of customers asking us to solve a manufacturing problem of saying, ‘We know how to make CPUs, GPUs; we know how to make lasers, we know how to make devices that convert electrical to optical signals and vice versa.’ But the challenge was how do you actually physically connect those chips together? How do you attach the chip to the fibre? How do you attach the laser to the chip?”

Solving a manufacturing ‘bottleneck’

The problem was the time it took to connect the components at scale., he explained.

“Essentially what we found out is that it takes about 10 minutes per connection, and most of that time is waiting for the glue to dry, and so that manufacturing piece, which is called optical packaging, was very primitive and artisanal in our field,” Chrostowski said.

“To me that was shocking to think, how can you make 100 million modules a year for these data centres if this rate-limiting step is 10 minutes?”

Chrostowski estimates that data centres will need about one billion lasers, making speed a critical factor in scaling production.. “We need a solution that is 100 times faster to be able to manufacture the parts that are needed for data centres.”

The potential market is huge, according to Chrostowski.

“A $150-billion market is the entire optics modules for data centres, and we are solving the critical bottleneck, which is the most challenging manufacturing step,” he said.

After six years of research and prototyping, Dream Photonics developed what Chrostowski describes as a “manufacturing solution.”

“What we do is essentially make this manufacturing process high-throughput, high-volume capable, and then transfer the process to contract manufacturers.”

The company plans to sell its process to the chip manufacturers, who will then be contracted by the large hyperscalers, such as NVIDIA, Google, Amazon and Microsoft. “They need to purchase 100 million optical modules, and somebody has to make those modules. The hyperscalers don’t make them; they contract that out to contract manufacturers,” Chrostowski said.

Overall, the hyperscalers are expected to spend about US$725 billion this year on AI and data centres, according to the Financial Times.

Dream Photonics aims to provide the know-how, the intellectual property and all the knowledge needed to create the process, “but it’s going to be located at the customer premises where they have all their other tools that do all the other steps in the assembly process.

"And so you can imagine that there are maybe 20 steps in the manufacturing process of optical modules, and one of those steps is this critical bottleneck, and then we’re offering a solution that replaces that step to make it 100 times faster.”

New Vancouver facility planned

The firm recently signed a lease agreement and plans to move its 15 employees to a 9,000-square-foot facility by the end of 2026, with a goal to come to market by the end of 2027 or early 2028, according to Chrostowski.

“That’ll be essentially our Vancouver pilot R&D manufacturing line, where we have the tool. We show the process. Customers can see it.”

For now, the company will continue on its quest to bring on more investors, and hopefully, many of those will be home-grown.

Its next step is raising US$10 million seed round to advance its journey. “And then the question is, who is going to fund startups that are doing this kind of work? The more Canadian investment we have, the more ownership we have over the technology. I would love to see Canada be a leader in this space,” he said.

“Photonics manufacturing, manufacturing in general, has not been a North American story for the last 20 years. The ethos has been designed in California, manufactured in China, and I’ve been seeing signals of an opportunity for the last maybe 10 years that there is an opportunity of building in North America.”