Canada’s Start-up Visa program is an excellent opportunity for entrepreneurs wanting to live in Canada. This program also provides both the resources needed to succeed in business, as well as a clear path towards immigration, and investment opportunities. The Start-up Visa program is partnered with Designated Organizations including, angel investors, venture capital firms, and business incubators. Each has their own entry requirements, and provides a unique set of resource connections for product development, and financial backing. For serious entrepreneurs, there is no better way to start a business.
Designated Organizations
First, lets start with what a “Designated Organization” is. Designated Organization are groups partnered with the Canadian government, who have a proven business development track record, industry connections, and financial backers for their clients. In addition, each maintains a set of guidelines and entrance requirements. Furthermore, requirements very between D.O.’s. In general, organizations look for applicants who have a deep knowledge of their business, chosen industry, and target market. Guidelines are chosen ensure maximum possibility of success rates.
Designated organizations,
- Angel investors
- Individuals with a high net-worth providing financial backing to start-ups.
- Venture capital groups
- Pooled investment funds, similar to a group of angel investors working through a single organization.
- Business incubators
- Consulting groups connecting entrepreneurs to resources and knowledge mainly for research and product development. These groups also help with connecting to funding.
Within these three categories, are a verity of organizations to choose from. In addition, not all have the same entrance requirements or access to resources. This makes it important to choose one that best suite your stage of business development and industry.
Backing Process
As previously mentioned, each Designated Organization has its own process. To this extent, we will only discuss general processes that are similar between organizations.
Business Incubators
There are generally 2 types of incubators, those that take in already established businesses, and those that help from the idea stage. For each, incubators require the applicant to have a strong knowledge of factors effecting their business, as well as its operations. Businesses must also have some level of innovation, such as an improvement on an existing product or an entirely new product. For example, a services such as accountants or law firms, don’t typically provide any innovation or deviation from traditional methods or business.
Once reviewed, a business may then move on to the next stage. This is usually an interview or secondary more in-depth version of the first stage. In essence, this is a first full pitch of the business plan, similar to what might be presented to an investor. Once this stage has been completed and the business approved, a letter of support is typically sent to the applicant.
Thirdly comes a pre-investment stage. This is the point at which business plans and products are developed. Depending on the organization, this my come before or after the organization has connected you with potential investors.
Angel Investors and Venture Capital
Essentially, these two groups provide more direct access to funding. However, unlike incubators, they do not typically provide the same access to development resources. Therefore, these investment options are best for businesses with already established products, industry connections, and a clear development plan.
As for the process, it is similar to the first round of pitches presented to incubator companies. First a primary business proposal review, second an in person review, and finally a formal pitch to investors.
Who can apply for a Start-up Visa
There are four requirements for the Start-up Visa program. These are,
- have a qualifying business
- get a letter of support from a designated organization
- meet the language requirements
- bring enough money to settle
What is a qualifying business? Up to 5 people can apply as owners, each holding at least 10% of the company. However, you, other owners, and the partnering organization must hold at least 51% of the company. In addition, the start-up must be incorporated in Canada, and you provide active and ongoing management of this business from within Canada.
A letter of support from a designated organization refers to the previously mentioned list of “preapproved organizations”. Each applicant must pitch their business idea to these organizations to convince them that the business idea is worth supporting. If you pass, the organization will send a commitment certificate directly to the immigration office dealing with your case.
Furthermore, there are two more minor requirements, language, and money to settle. Both of which are especially important for any new business in Canada.
*Language: “You must meet the minimum level of the Canadian Language Benchmark (CLB) 5 in either English or French in all of these four areas: speaking, reading, listening, and writing.
*Personal funds: For an individual, the initial amount of required funds are, $12,960, $16,135 for a couple (2 people), $19,836 for three, and $24,083 for a family of four. The required funds increase from here. If you’d like to learn more you can contact us through the link.