Let me start by admitting that answering this question is not easy. But by examining those pillars that make a certain city worthy of this title will give us a clue whether the answer yes or no.
First and foremost the existence of second-to-non educational institutions tops this list. We all know how Stanford University played a major role in producing the majority of engineers and future founders of well-known companies and start-ups. What makes Stanford unique when compared to other North American universities is its focus on promoting entrepreneurial culture. Engineering or business students who take time off to start their own ventures is not viewed as a minus but to the contrary is viewed in a positive way. One has to only visit the University book store to realize how many books are dedicated to business and entrepreneurship.
Second, the existence of Venture Capital firms and Angel investors who understand the technology language is so crucial. In Silicon valley you do not have to spend months or years explaining to VCs (or Angels) why your solution to a certain technology problem is disruptive. They will immediately get it as they breath this day and night. Furthermore, these VCs are willing to take greater risks than their counterparts in other cities.
Third, the overall culture that is promoted, especially by serial entrepreneurs, encourages people to try new things and never be afraid of failure. This in turn encourages innovation and creativity.
There are various cities in Canada that have tried to copy the Silicon Valley example. Ottawa was once called the Silicon Valley North. Unfortunately this was short lived.
We are now witnessing few rising stars such as Vancouver, Toronto and Waterloo. In my opinion, Waterloo has a greater chance of deserving this title in few years from now as the city has the infrastructure and all of the pillars mentioned above. One has to only follow Maclean's School Rankings year after year to realize that Waterloo University is on track to become the Canadian Stanford. The University's focus on entrepreneurship is evident. One has only to take a look at its Velocity Program, a university-based micro incubator. Furthermore, many high-tech entrepreneurs such as Jim Balsillie are putting a lot of effort into making this happen.
Will Waterloo truly deserve this title? Time will tell but one can already see that all the pillars are there to make this dream a reality.