Starting a business can be a difficult and long process. In most cases to start a successful business in takes months, and in some cases years of planning and research. This includes the time it takes for feasibility analysis, market research, sourcing suppliers, building a team, and perfecting your business plan. For most, its a difficult task even when you’re familiar with the market, let alone starting a business overseas. So, to help you on your journey we have listed a few things you should know about starting a business in Canada and receiving investor funding.
Planning your Business
Business planning is a critical part of a company’s success and often the part that most small business owners don’t spend enough time on. It’s common for companies to start off on a great idea but with poor planning, market research and execution that lead to their inevitable downfall. It is also one of the most important steps if you’re looking to secure investment for your start-up, as investors want to see a concrete plan backed by data and strategic planning; something we will talk more about later in this article.
There are quiet a few steps in writing a business planning, and a good plan can take months to complete. These steps include but are not limited to,
- Primary and secondary research
- market analysis
- feasibility analysis
- financial planning and projections
- marketing planning
- development strategy
- go to market strategy
Remember that these are just a few basic examples and that each business plan will be different for each company. Take time on each of these steps, the more effort you spend here to identify possible gaps and weakness the easier it will be to adapt and grow your company. Also, remember that its okay to have weaknesses in your business plan, what is important is that you can identify them and plan accordingly. This will also show investors that you are knowledgeable and that you’ve covered your blind spots to reassure them that their money is in good hands. A good business plan doesn’t always mean a perfect one, often its the one that has the best insight an planning.
Consider hiring an advisor to help you along if you aren’t experienced, even if you have an education in business. Often these advisors have industry insights or knowledge gained from working with business just like yours that you don’t have access to. It also helps to have a fresh perspective, as often those closest to the business have difficulty seeing its flaws. For a sample of what your plan should include, visit our business page.
Registering your Business
Every company in Canada should be registered under the province or territory in which they preside. This does not mean that you are legally obligated to register your business name and it is perfecting fine to be what is call a “numbered company”. This just refers to a company operating under a registered business number provided by the government upon registration. Registering your business is an important step which will ensure you have any necessary licenses or permits, can pay your taxes properly, and get access to all the funding and support available to you from government agencies.
Before you register your business, you will need to know:
- where your main office will be located
- which other provinces and territories you plan to operate in
- your proposed business name (see Choosing a name)
- the type of business that best suits your needs (see sole proprietorship, partnership, corporation or co-operative for help determining which structure is right for you).
You should also make sure you choose the proper business type. With each type of business comes different tax regulations and legal liabilities. So depending on the size of the business, how it functions, and what services you provide, you may need to considered a different business type. For example, sole proprietorships and partnerships often place more legal liability directly on the business owners, where as corporation owners tend to have less liability directly connected to them.
Here is a list of these business types,
- Corporation (federal or provincial/territorial)
- Sole proprietorship or partnership
- Cooperative
Make sure that before choosing which to register under, you find out what legal and financial obligations these formations hold. The Canadian government also provides an easy step by step guide to what you need to start a business in Canada.
Applying for Permits and Licenses
Depending on the type of business you are running, if that be a food industry based company, medical, school etc. you may need to register for a license or permit pertaining directly to those services. Permits can also apply for business location, such as those related to zoning rules and regulations, as well as vendors permits.
In a number of provinces, businesses must also register for provincial tax regimes. Alberta and the territories have no sales tax, other provinces have harmonized their sales tax with the federal government’s while others have maintained their independent provincial sales tax. It’s up to the business owner to determine which regime applies to his or her company.
There are other regulations concerning which businesses have to register with their provincial or territorial government depending on where you live, including at what income level you must begin collecting provincial sales tax. You can visit the Canada Business Network site for additional information on registration across Canada. Businesses earning less than $30,000 annually usually do not have to register for GST/HST and probably don’t need to register with the federal government. However, businesses of a certain size, businesses with employees and businesses engaged in certain activities do have to register with the federal Canada Revenue Agency (CRA).
We recommend using the site in the link to find out is your business needs a permit or a licenses based on its industry and location.
Getting financial Support
Canada provides for a wide range of business support, both on the federal and provincial level. This includes things like funding to help farms, all the way to grants for new tech start-up. Chances are, if you’re starting a business in Canada there is some form of finical support available to you.
This financial support may not just be from government sources either, there are also private institutions that provide help with business funding, especially for those companies trying to reach investors. Canada has a list of what we call “designated organizations”, these are angel investors, venture capital groups and business incubators that help fund immigrant run businesses in Canada. For a full list of these companies follow the link. Keep in mind that whenever you reach out to a potential investor, that you must have a full business plan as well as a proposal for them to review.
For more information on federal grants click here. For more information on BC provincial grants click here.
Immigrating to Canada
There are two main categories for business immigration into Canada that we provide, BC PNP Entrepreneurs and the Start-up Visa Program.
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.
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.
Entrepreneurship covers those interested in starting a new business or taking over an existing business in Canada. There are many requirements for those wishing to take this route. For starters, the Canadian government states that, “If you are invited to submit an application, you must submit a comprehensive business plan that provides detailed information about your proposed business in B.C.”. These entrepreneurs must also employ at least one Canadian citizen.
Taraz provides services not only for the immigration process but also for the “business plan” creation and review. Our in house team of lawyers, accountants and business professionals will review your comprehensive business plan to make sure that everything is inline with government standards. In addition, we also help these individuals with the business registration process. This includes but is not limited to, registering a company name and business license. For more information visit our contact page to leave us a message, or call us at +1-778-682-4934.