Canada Launches a Startup Visa to Lure Entrepreneurs
Warning to Silicon Valley and Bangalore: Canada wants to poach your entrepreneurs. The country, which already has one of the world’s most open immigration policies, began accepting applications for a new visa for highly skilled entrepreneurs on April 1. Under the pilot program, foreign nationals with funding from a government-approved list of about two dozen Canadian venture capital firms or angel investor groups can apply for immediate permanent residency. “If a Canadian venture capitalist is going to invest in a startup, we’d rather that business [be located] in Canada than India or Silicon Valley or somewhere else overseas,” says Jason Kenney, Canada’s citizenship, immigration, and multiculturalism minister.
The country joins a growing list of nations, including Australia, Chile, and the U.K., that have recently introduced or revamped visas designed to woo foreign entrepreneurs. Unlike Canada, most only grant permanent residency once startups can prove they’re having a positive economic impact—an assessment usually based on the number of well-paying jobs created.
The U.S. government has been unable to launch a similar program, despite numerous attempts to change how it grants visas to highly skilled immigrants. The latest is the Startup Act 3.0, legislation introduced by Senators Jerry Moran (R-Kan.), Mark Warner (D-Va.), Chris Coons (D-Del.), and Roy Blunt (R-Mo.) in February.
The law would create up to 75,000 visas for immigrant entrepreneurs who invest at least $100,000 in or raise that amount for their ventures. The Kauffman Foundation, a Kansas City (Mo.)-based organization that supports entrepreneurship, estimates that 500,000 to 1.6 million new jobs could be created as a result of the program over the next decade. “This can lead to tens of thousands of new startups,” says Vivek Wadhwa, an academic and the author of The Immigrant Exodus: Why America Is Losing the Global Race to Capture Entrepreneurial Talent, in an e-mail. “It will do wonders for the economy without costing taxpayers a cent.”
There is support in Congress from both sides of the aisle for policies designed to attract highly educated and skilled migrants, but the Obama administration is against taking a piecemeal approach to reform. “I’m very worried that if comprehensive immigration reform doesn’t happen, we’ve again lost time on something that we could pass,” Moran says. “We’re losing the battle every day for global talent. Entrepreneurs are making decisions to leave the country and go elsewhere.”
Officials in Ottawa are trying to take advantage of Washington’s slow pace. “We’re very conscious of the presence of thousands of brilliant, young IT specialists and entrepreneurs in the States who are on temporary visas, running out of runway,” says Kenney. “Many of them have developed business concepts but can’t get permanent residency in the U.S.” That’s why Kenney is heading to Silicon Valley in May to promote his country’s new startup visa. “I anticipate there might be some action for us in India as well,” he says.
Canada has allotted just 2,750 visas for entrepreneurs and their families in the first year. That’s roughly 1 percent of the 257,515 permanent residencies the country granted in 2012, according to the government’s preliminary tally. Kenney says he expects the program will “start relatively slowly but then extend after that.”