Anyone else find this to be an odd way to go about it?
VC firms have distinctly different goals when funding companies than the people actually running the company.
I guess it raises some questions for me:
(1) Is there a floor to how much funding is required? For lack of a better term, does the start-up have to have X numbers of years of runway to qualify? (2) What happens to the entrepreneur if the VC firms decides to turf them? Do they get to stay or are they required to leave the country? (3) Does the entire start-up team get visas? The article mentions how the old e-ship visa has been put on hold. So if a founder gets VC funding, starts the company, but wants to bring in more foreign workers, can they?
Don't get me wrong, I think this is a great idea and it is exactly what the US should be doing as well. There are just a lot of unanswered questions for me and I wonder how well it will work in practice.
(1) Given the abysmal failure of the previous 'entrepreneur' visa category, I believe that they would probably go with at least a 12mo runway, although the VC firms and startup team would probably have to justify (via paper projection - ha!) a reasonable 2yr runway.
(2) The example in the article provided was the case of Summify, which was acquired by Twitter[1]. That seems to be the spark (among others) to bring more attention to the issue of a lack of strong Canadian anchor companies[2]. Again, using the previous 'entrepreneur' visa category which supposedly was being used as a loophole, the government is trying to respond by focusing on previous examples and a growing chorus of media and startup community attention around keeping and growing Canadian startup talent.
(3) Assuming that an "entire" startup team might consist of 2-5 people (I wish I had a statistic to back this up somehow other than anecdotal reading), that's not a far stretch. If the founder(s) want to hire foreign workers, then that may be more difficult because Canada would sure want to encourage them to try attracting and keeping Canadian technical talent first.
[1]http://startupvisa.ca/summify-inspiration-by-startup-visa-ca...
[2]http://www.theglobeandmail.com/report-on-business/economy/ca...
The article hints that small teams will be accepted, but also says "Canada seeks ... immigrants who will contribute to Canada’s job growth", so the number of Canadian employees will be the deciding factor along with the amount generated for the economy.
From my experience with US friends who have Canadian work visas, Canada is strict and will not allow foreigners to remain long without an employee sponsor. It's also difficult to acquire citizenship without several years of residence. I would guess that hiring foreigners will be accepted as long as the investment amount is high, but the likelihood that they will become permanent residents is very low.
[1] http://www.cic.gc.ca/english/immigrate/business/investors/in...
[2] http://news.nationalpost.com/2012/08/12/chinese-citizens-dem...
You need a spend a certain amount of time living in Canada as a permanent resident (3 years, non-contiguous, although this figure may be out of date) to be eligible for citizenship, but if you have permanent residency you have almost the same rights as a citizen. It's getting the permanent resident status that's hard. There is no requirement to live in Canada under another visa to obtain permanent residency - you can apply for and obtain permanent residency status from your home country before arriving in Canada. That's how the majority of non-family sponsored people immigrate to Canada.
$400,000 investment and at least a 33.3% stake in the company. Plus a net worth requirement of $800,000.
http://www.welcomebc.ca/wbc/immigration/come/work/about/busi...?
Government should be very careful to not create a loophole for de facto illegal immigration, so limiting funding to some set of established VCs is natural (or people will start providing fictional funding to themselves on paper, never spending it, their 'startups' will go nowhere, and they will bring in whole villages of 'early employees' to work on gas stations and clean floors). You can't imagine how tricky the desperate people who want to escape their unfortunate countries are, and they have a lot of time to figure out the paperwork, and the government knows it, so expect a lot of red tape, and expect limitations that will seem stupid.
Also most likely, after N years (2..4) the visa will automatically expire and they will have to apply under the already existing entrepreneural category, meaning startup will have to take off by then, having certain turnover and N+ full time jobs in existence, or leave.
To me, this is natural and positive. Good countries are like good clubs, they are good only as long as they are hard to get into. Lift the barriers and there will be no place in the world you'd wish to go on a vacation.
Own experience: i have immigrated to several countries, and i can tell a strong positive link between difficulty of getting through paperwork and quality of living.
To me, this is natural and positive.
Good countries are like good clubs,
they are good only as long as they
are hard to get into. Lift the barriers
and there will be no place in the world
you'd wish to go on a vacation.
Moving across the world to a different country, leaving everyone and everything you know to start in a foreign culture and language is a pain in the butt. The people who are so driven and motivated they're willing to endure that in order to find work are the kind of people you'd want in your country.
One finding was that when it came to financial support for startups, government acting alone (ie allowing some random beauracrats to decide which startups to give grants to) was counter-productive. But working with VC firms (ie governments investing in VC firms or some kind of matched investment scheme) generally saw good results. (Passion Capital in the UK and various initiatives in Israel were both given as examples IIRC).
Also, any time you involve money people, you set the stage for things to get crooked and shady. I can already hear the narrator from some "Inside Job" type documentary on corruption in Canada.
"However, the Canadians didn't account for one major loophole. In 2012, they passed a law allowing startups with venture capital to emigrate into the country, but what they didn't consider was: ___________"
For those startups that don't require VC money, I just think that the government has no clue how to deal with that without it being exploited like the last visa, so they figured they'd throw something out there that they could pull off with their majority government.
Good question. But I'd also ask why, as an American, would you love to found a startup in Canada? What advantage over starting it in the US?
There are also advantages to living in the US of course, where this Canadian is currently working.
>> An initial source of candidates could be frustrated foreigners in the high-tech sector in the United States who have not been able to land resident status there.
The main problem is that Canada doesn't have near enough active VC investors.
Hardly anywhere does, even Silicon Valley.
Having them be the sole gatekeepers will fall far short of what's possible.
Given it's only 2750 visas/yr, I like to think this is the Canadian government's version of an MVP that VCs and Canadian startup communities have lobbied hard for.
Maybe they'll find ways to expand or relax the qualifying restrictions in the future.
A trend that is certainly changing. Vancouver, for instance, has a growing and vibrant VC community, from which this very bill was initiated.
This visa means you can work for your own company, in Canada, provided it has funding from a VC. Lets reword that a bit and it sounds like "You can work for a specific company, in Canada, provided you have an offer letter"
Honestly if Canada wants to do something truly innovative, they should look at the track record of applicants rather than simply saying "get a VC to sponsor you". Things like: have they received funding previously, do they have relevant experience, have they got any revenue or "traction" on their current idea, how have they validated their current idea and whats the chance of it getting funding...are all great places to start.
The bottom line: there are plenty of people without VC funding who Canada should welcome, and this visa offers no assistance to. Sadly if Canada doesnt let them in, someone else will, and with VCs in the US getting more comfortable with non North American investments, maybe this doesnt change anything?
But... isn't that exactly what a VC would do? While I absolutely do understand the frustration with VCs being the gatekeepers for this, it's much more preferable to the government holding the keys. They would be useless at assessing "idea traction" for example, and I'm glad they know enough to not try.
As someone in the US on an H1B visa who left Canada because of visa restrictions, this does look very interesting- even if it's just a starting point. I just got back from a weekend in Vancouver- I'd forgotten how much I love that city.
I have a B1/B2 visa as well, and in general ive never had any real visa issues but I just feel that with all the options available to people today, you need to do more than say "if the VC says yes, so do we"
Otherwise one could think that progress is being made. Whereas it looks like Canada doesn't even want entrepreneurs; instead it wants "hot" companies to move to Canada (see VC requirement and just 2750 visas/year).
Canada's backlog of (immigration) Visas is huge, and they are apparently not keeping up with it
Check the website and see the average delays in processing.
Apparently Canada has almost everything that is needed to have great startups, except the culture (and maybe the drive).