Guide to Canada's Start-up Visa (SUV) in 2023: A Comprehensive Manual

Canada's Start-Up Visa (SUV) program provides a pathway for foreign entrepreneurs to secure permanent residency in Canada through business immigration. Those with innovative startups or established foreign companies can utilize this program to permanently relocate to Canada, bringing up to 5 founding partners with them, provided they satisfy the program's additional requirements.
We made this guide for foreign entrepreneurs contemplating an application to the Start-up Visa Program. It encompasses exhaustive information about the program. Additionally, practical tips will enhance your chances of success in this program. Let's delve into the details.

Start-up Visa Canada: 2023 Eligibility Criteria

Outlined below are the stipulated requirements established by Canadian immigration authorities for entrepreneurs aspiring to attain permanent residence in Canada under the SUV program:
1. Obtain a Letter of Support or investment commitment from one of the Designated Organizations in Canada.
2. Each foreign national must possess a minimum ownership stake of 10% in the start-up. Collectively, foreign nationals and their Designated Organizations must control more than 50% of the total shares (voting rights) in the start-up venture.
3. Attain a minimum English or French language proficiency at CLB level 5.
4. Demonstrate sufficient funds to settle in Canada, ranging from $12,960 to $34,299, depending on the size of the applicant's family.
To increase the likelihood of success in the program, entrepreneurs must be prepared to meet the following basic criteria:
1. Possession of an innovative or successful business generating scalable and sustainable revenue or exhibiting strong market validation.
2. Availability of capital to fund the start-up venture, typically requiring a minimum of $200,000 per applicant.
3. Possession of highly specialized knowledge, unique experience in the field, or robust managerial expertise.
4. Attainment of an upper-intermediate level of proficiency in English and/or French languages.

Who Should Avoid Applying for Canada's Start-up Visa

The Start-up Visa Program is not suitable for foreign entrepreneurs with limited capital to invest in their Canadian startup venture. A crucial prerequisite for this program is securing a letter of support or investment commitment from one of the Designated Organizations in Canada. The likelihood of obtaining support from these organizations is extremely low if you or your company lack the necessary capital for investment in the venture.
While the SUV program is promoted as having "no minimum investment required," the reality is that your venture must be adequately capitalized to garner support from Designated Organizations. It is overly optimistic to believe that having a fantastic idea will automatically attract investment from Canadian VCs or Investors, as they typically seek established companies with a track record of traction and significant revenue before committing any funds.
Therefore, if you are an entrepreneur with a compelling product or service but limited capital for your venture's growth (less than $200,000), the Start-up Visa Program may not be a suitable avenue for you.

Pros and Cons of the Start-Up Visa: An In-depth Analysis

It is important to evaluate the advantages and disadvantages of the Start-Up Visa (SUV) Program. A deep understanding of what this program entails and whether it meets your goals is crucial.

Advantages of the Program

Here are some of the positive aspects of the SUV program:
1. A direct pathway to attain permanent residence in Canada.
2. Open to individuals of all nationalities.
3. No restrictions on business activities within Canada.
4. No net worth requirement or verification.
5. Allows a partnership of up to 5 individuals in the same start-up (each partner must own a minimum of 10% of the venture).
6. Opportunity to relocate to Canada by obtaining a work permit while the permanent residence application is being processed.

Disadvantages of the Program

Consider the following drawbacks associated with the SUV program:
1. Intense competition for support from Designated Organizations in Canada, making it challenging to secure such backing.
2. Lengthy processing times (more than 3 years) to obtain a permanent residence permit.
3. Often requires substantial capital investments by founding partners to secure support from designated organizations.
4. Demands an extremely well-developed, viable, and scalable business model with a proven track record of success.
5. Moderate risk of refusals at the permanent residence stage and/or delays due to peer reviews.

Securing a Letter of Support for Canada's Start-Up Visa Program

Obtaining a letter of support from a Canadian Designated Organization is a formidable task, as your start-up must demonstrate strong market validation or recurring scalable revenue. If you possess an innovative idea, relevant skills, and the capital to execute it, consider collaborating with specialized business consultants to develop, test, and validate the concept before seeking an endorsement.
To acquire a letter of support, follow these key steps:
1. Prepare your Pitch Deck (business concept) or a Business Plan.
2. Submit your application to a Designated Organization for review and evaluation.
3. Undergo an interview with a Designated Organization.
4. Sign an agreement with the Designated Organization.
5. Pay the required fees.
6. Obtain a Letter of Support from the Designated Organization(s).
7. Submit your application for permanent residency and a work permit.
If you need help with any of these steps, do not hesitate to ask for advice and support. We can connect you with the right people and resources to help you immigrate.

List of Designated Organizations

Depending on the type of designated organization you engage with, you may need to complete a Start-up Development Program or receive funding from them in exchange for equity in your company. This is a critical SUV requirement, and obtaining a Commitment Certificate and Letter of Support from Venture Capital Funds, Angel Investor Groups, or Business Incubators is crucial. Refer to the complete list of designated organizations for further details.

Processing Time for Start-up Visa Program

SUV processing times can vary based on the workload of the Immigration, Refugees, and Citizenship Canada (IRCC). General guidelines indicate a waiting period of 3 to 5 years for the final decision on an application.

Start-up Visa Canada Costs: In-Depth Review

The costs associated with the StartUp Visa program in Canada range from 165,730 to 300,000 Canadian dollars or more, depending on various factors. It's important to note that this program is not suitable for entrepreneurs without access to capital for their business venture in Canada. Refer to the sample cost structure below for an approximate understanding of the funds required to support your Start-up Visa program application. All fees are approximate estimates in USD dollars and include charges from service providers and various companies offering SUV Program support.

Preparation of Pitch Deck

Investment for Innovative, Scalable Start-ups Generating $500K+ Annual Revenues:
- $3,000 – $5,000 (for proprietary startups meeting the outlined criteria)
Investment for Start-ups Not Meeting the Above Requirements:
- $100,000+ (includes market research, validation of assumptions in the Canadian market, and generating initial traction with customers to achieve the market-product fit required by Designated Organizations)

Fees Charged by Designated Organizations:

- Incubators: $40,000+ per company.
- Angel Investors: $35,000+ per company.
- Venture Capital Funds: $50,000+ per company.

Legal Costs:

- Professional Fees (lawyers): Approximately $20,000+ per applicant

Government Fees:

- PR: Main Applicant – $1,540
- PR: Spouse – $1,040
- PR: Dependent Child – $150

Business Execution Costs:

- Variable based on business nature and industry. Allocate at least $100,000+ per applicant for operational costs while awaiting permanent residence.

Canada Start-up Visa Success Rate:

With proper handling, meeting all requirements, and providing necessary documentation, the IRCC notes a general success rate of over 75%.

Approval Rates Based on Designated Organization Type:

  • 78% – Startups supported by business incubators
  • 80% – Startups supported by angel investor networks
  • 43% – Startups supported by venture capital funds

Reasons for Delay or Rejection in Start-up Visa Application:

Immigration Officers may initiate a peer review if doubts arise about enterprise genuineness or feasibility. Red flags include:
  • Disproportionately high or low shares held by the investing entity.
  • Limited control or equity for the applicant.
  • Applicants with familial ties or lacking experience/education.
  • Lack of intellectual property or a generic business plan.
  • Unusually high fees charged by designated organizations.
  • Limited startup experience in the management team.
  • Failure to provide evidence of the applicant's essential role.
  • Lack of significant progress during lawful authorization to work in Canada.
Ensure a well-documented due diligence process with substantial evidence demonstrating the authenticity and viability of your venture. Follow our top tips for a successful application.

Seek Experienced Advice Before Applying for Canada's Start-up Visa Program:

CBGA team can assist in bringing your startup business to Canada, addressing aspects related to your family and business partners. Focus on your startup idea while we navigate the pathway to your permanent residence in Canada.