Canada is making hay with a new Start-Up Visa Program while its neighbor south of the border is seemingly intent on keeping entrepreneurs out by making it harder to get H1B visas. So what’s the deal on the Start-Up Visa? Here’s a guide that explains the program. By the time you finish reading, you’ll realize that it’s a full-fledged business development program that supports entrepreneurs every step of the way towards establishing a startup with a permanent home in Canada.
There are four simple eligibility criteria for applicants seeking the Start-Up Visa.
1. Form of Commitment – Citizenship and Immigration Canada (CIC) has approved a number of venture capital funds and angel investor groups under this program. Applicants must have a letter of commitment from one of these designated investors. Commitments from VCs must be for an investment of at least $200,000 CAD, while those seeking support from an angel investor must show a commitment of at least $75,000 CAD.
2. Language – Applicant must be able to communicate in English or French, as in Canadian Language Benchmark (CLB) 5 for all abilities.
3. Education – Applicant needs to have completed a minimum of one year of post-secondary education, and must have been in good standing at the institution during that year.
4. Relocation – Applicant must have enough money to cover the cost of relocating to Canada and paying for cost of living expenses for self and dependents until such time as the business provides the applicant with sufficient earnings.
Now that’s just the basic outline of the program. The key aspect that makes it so unique is the fact that Canada is offering an upfront guarantee of permanent residency. As long as you fulfill the above criteria and other basic immigration checks, you will get permanent residency status that remains valid regardless of what happens to the business afterwards.
The second major factor that makes this program appealing to entrepreneurs is that Canada is helping connect applicants to organizations that provide startup support and mentorship, including the Venture Capital and Private Equity Association (CVCA) and National Angel Capital Organization (NACO).
Basically, you need to make a successful pitch to one of the designated VCs or angel funds. The rest is all taken care of, and you have an assured home for your startup in Canada. This is a radically different concept as compared to the controversial EB-5 program in the U.S. or the difficulty entrepreneurs face in getting H1B visas approved for themselves and their employees.
The whole thing was aptly summed up back in May 2013 by a cheeky billboard in San Jose, CA paid for by Citizenship and Immigration Canada (CIC), which said “H1-B problems? Pivot to Canada. New Start-Up Visa. Low Taxes.” The billboard was timed to coincide with Canadian Immigration Minister Jason Kenney’s visit to Silicon Valley in an effort to publicize the new Start-Up Visa Program that had just been launched in April 2013.
The Start-Up Visa Program, as it stands now, is a pilot program authorized for an initial period of five years. Canada plans to issue a maximum of 2,750 visas under this program annually, but they may not get that many takers right off the bat. Ultimately, what it comes down to is whether VC funds and angel investors in tech hubs such as Kitchener/Waterloo, Vancouver, Toronto and Montreal are willing to take more risks and match their counterparts across the border in Silicon Valley, Boston and New York.