* Venture capital funds would identify people for start-ups
* Canada wants to lure high-tech and other entrepreneurs
* Sweeping changes being made to immigration system
By Randall Palmer
OTTAWA, Sept 11 Canada plans to create a new
class of visa that it hopes will attract high-tech and other
entrepreneurs to immigrate to the country to start new
companies, officials said on Tuesday.
It has put a moratorium on issuing its existing entrepreneur
visa, which only required an immigrant to hire one person for
one year, and intends to initiate a visa that would be issued to
people identified by venture capital funds as candidates to
create start-up firms in Canada. The venture funds would be
required to invest in the start-ups.
The start-up visa is one of several changes being undertaken
by Citizenship and Immigration Minister Jason Kenney in what he
says is an effort to make the immigration system more responsive
to Canada's economic needs.
"Canada seeks young, ambitious, innovative immigrants who
will contribute to Canada's job growth and further drive our
economy," said Kenney's press secretary, Alexis Pavlich.
"The start-up visa is an initiative that the government of
Canada is exploring to assist in transforming our immigration
system into a fast, fair and flexible system that will meet the
needs of our economy and help grow our country."
Venture investment funds would choose entrepreneurs in whom
they would invest, and the government would try to clear them
for entry into Canada within weeks.
The idea is to unite Canadian money and foreign brains.
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.
"This program will link brilliant, job-creating, immigrant
entrepreneurs with Canadian investors. We want the world's best
and brightest to come to Canada - to start businesses and to
create jobs in Canada," Pavlich said.
The program, expected to be unveiled in detail later this
year, would set up external safeguards and spot checks to make
sure the venture funds are investing as promised.
The government will set aside 2,750 visas a year for
start-up entrepreneurs and their families. Last year it issued
about 700 visas under the old entrepreneur class, under which an
immigrant could do something as simple as buy a corner store and
hire one person, and then get out of the business after a year.
The immigration department said Vancouver-based Version One
Ventures, which invests in five to 10 tech or Internet start-ups
in Canada and the United States every year, was one of the
venture funds it consulted in developing the new visa program.
"There are never enough brains in a country," Version One
Ventures founder Boris Wertz said. "Every country's going to
compete for the best brains in the world."
He cited the case of a team of Romanian engineers who worked
in Vancouver but could only get six-month visas, requiring them
to leave the country and return repeatedly.
Eventually their outfit was sold and they moved to Silicon
Valley in California. "We lost them, and part of the reason was
always they never had the security that they could really stay
in the country (and) focus on building the product," Wertz said.
Kenney also intends to revamp a separate investor class
visa, which granted people the right to immigrate if they ponied
up C$400,000 to C$800,000 ($412,000 to $825,000) to lend to
The biggest changes to the system have been to the skilled
worker program, which had a decade-long backlog. By returning
years' worth of older applications and by putting a moratorium
on new applications, the government hopes to clear the backlog
by 2014 and enable new applicants to gain entry in months.
Toronto-Dominion Bank issued a study on Tuesday that said
Canada would have to increase its annual immigration level to
300,000 after 2016 from the current 250,000 if it wants to keep
growth in the labor force in line with the historical trend ().
However, TD said that until more is done to improve the
economic prospects of newcomers to Canada, it would likely be
counter-productive to do so.
Responding to the report, Pavlich said immigration is not a
panacea for labor shortages. "Canada already maintains the
highest sustained level of immigration in the world," she said.
"In order for Canada to maintain an open and generous
immigration system, it is important that Canadians continue to
believe that immigration serves our national interest. Canadians
have been clear - the vast majority do not want the government
to massively increase immigration levels."