Today, we are living in times of economic turmoil. The Covid-19 pandemic has jolted the leading world economies and brought several businesses down to their knees.
As an entrepreneur looking to venture abroad in such times, it becomes crucial to consider several aspects. There are numerous elements to consider like cultural differences, fund generation, marketing, etc. One such aspect is the ease of doing business.
The ‘Startup Visa Canada‘ initiative is a commendable effort on the part of the Canadian government. It aims to invite immigrant entrepreneurs and make it easy for them to start a business in Canada.
This post will help us understand why the ‘Startup Visa Canada‘ is the best option for many immigrant entrepreneurs. It will also help us learn how the program works. However, before venturing into the nitty-gritty, let us first answer the most obvious question, Why Canada?
The Canadian Advantage
When it comes to Canada, it is pointless to quote surveys and studies. Confused? Let us explain.
Canada has been consistently ranked among the top 5 countries that offer exceptional quality of life. It is politically stable and home to the world’s leading secure banking system. It is one of the least polluted nations and boasts robust health care and public education system.
Moreover, Canada’s largest city, Toronto, is ranked among the top 5 tech talent markets across North America.
Startup Visa Canada – Helping Immigrant Entrepreneurs Thrive
Immigrant entrepreneurs bring diverse thought processes and expertise to the table. They contribute to an economy’s growth and help generate employment. Canada appreciates the same and extends a warm welcome to immigrant entrepreneurs.
Canada has replaced the old and passive Quebec Investor Program with an active Immigration Permanent Resident Program. The aim is to attract entrepreneurs from across the world and help them build a business that can compete globally.
The new ‘Startup Visa Canada‘ initiative has proved to be a boon for immigrant entrepreneurs. Immigrant entrepreneurs no longer need to invest a minimum amount, and there are no net worth obligations involved. They can live anywhere and apply for Canada’s citizenship and passport after spending three years as a permanent resident.
Eligibility for Applying to the ‘Startup Visa Canada’ Program
Immigrant entrepreneurs looking to enroll must prove their proficiency in English or French. They are expected to meet the minimum level of the Canadian Language Benchmark 5. They can either take an IELTS or any other test approved by Immigration Refugees and Citizenship Canada (IRCC).
Canada does not provide financial aid to startup visa immigrants. Immigrant entrepreneurs must prove they possess enough funds to support themselves and their families while in Canada. They must provide proof of settlement funds amounting to $10,000. Additionally, they must also submit proof of funds amounting to $2,500 per family member.
How Does the Initiative Work?
When planning to expand abroad, you must convince local venture capitalists and investor groups to invest in your idea. In the case of the ‘Startup Visa Canada‘ program, such investors must be designated by the Canadian government. An immigrant entrepreneur must first present a viable business proposition that satisfies the due diligence requirements of such investor groups. There are three ways to go about the same.
- The Business Incubator Program
The business incubator program is arguably the most popular option. Under this method, a business incubator works with immigrant entrepreneurs. An immigrant entrepreneur is required to pay a sum of roughly $70,000 to the incubator. In turn, the incubator helps the immigrant entrepreneur prepare a viable business plan. The whole process takes approximately 4-6 months as it involves spending time in Canada to understand various aspects.
- Government-designated Angel Investor Groups
Under this method, an immigrant entrepreneur can seek the help of government-designated angel investor groups. An immigrant entrepreneur needs to convince an angel investor group to invest no less than $60,000 in their project.
- Government-designated Venture Capitalist Groups
Under this method, an immigrant entrepreneur can seek the help of government-designated venture capitalist groups. An immigrant entrepreneur needs to convince a venture capitalist group to invest no less than USD 1,50,000 in their project.
Immigrant entrepreneurs will need to acquire at least 10% voting shares in the Canadian company incorporated into their project. They must also participate actively in the management of the new enterprise.
All Ready to Go
Once all requirements are met, immigrant entrepreneurs will receive a letter of support from the sponsoring companies. The processing of permanent resident immigration applications takes around 18 months. However, with a letter of support, immigrant entrepreneurs can apply for a short-term work permit. Their spouses can also apply for an open work permit, and their children can attend school at no cost. They also become eligible for free health care three months after they enter Canada.
Final Thoughts
The Covid-19 crisis has already caused a lot of pain to individuals and businesses alike. Stringent economic policies will only act to make matters worse. Initiatives such as the ‘Startup Visa Canada‘ are a welcome move to help people resurrect and live their lives more meaningfully.