Canada Start-Up Visa: What is a Venture Capital Fund?

Colin R. Singer
febrero 8, 2024

The number of venture capital funds in Canada that can provide help to foreign nationals applying for permanent residence in the country under the Start-Up Visa (SUV) program has grown by 33 per cent in only two years.

In 2021, there were only 21 venture capital funds from which SUV applicants could get the needed minimum of $200,000 of investment funds under the program. Now, there are 28 such venture capital funds.

Venture capital funds are one of the three designated categories of organizations that also include angel investors and business incubators, who must back an applicant under the SUV.

A venture capital fund is created when a group of investors pools money to place it in start-ups and small and medium-sized companies which show promise of rapid growth. The investors are looking for equity in these companies and are willing to accept the higher risk associated with these business ventures in exchange for the promise of higher returns.

Under the SUV, Immigration, Refugees and Citizenship Canada (IRCC) has designed the following 28 venture capital funds as authorized to provide financing to immigrant entrepreneur applicants.

Those firms are:

When a prospective immigrant to Canada decides to apply under the SUV, his or her business idea must get the support of one of the three designated groups of organizations who then choose which business proposals to review. Each organization has its own intake process for proposals and criteria used to assess them.

Immigrant Entrepreneurs Must Show Proof Of Sufficient Funds

If that organization gives the SUV applicant’s proposal the two thumbs up, it will provide a letter of support, allowing the prospective immigrant to continue with the process.

The basic candidate eligibility requirements for the SUV program are:

a qualifying business;
a commitment certificate and letter of support from a designated entity;
sufficient unencumbered, available and transferable settlement funds, and;
proficiency in English or French at the minimum Canadian Language Benchmark level 5.

Ottawa does not give financial support to new SUV immigrants.

When candidates apply, they need to give proof they have the money to support themselves and their dependents in Canada. This money cannot be borrowed.

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The amount needed depends on the size of the candidate’s family.

With a viable start-up business project, an immigrant entrepreneur can expect it to take about four to six months to secure a commitment certificate or letter of support from a designated entity. Once that letter of support is received, the application for permanent residence can be submitted. It will then take approximately 18 months to finalize the application through to the issuance of a permanent residence visa.

For the candidate to qualify for permanent residence:

the intended business must be incorporated and carrying on business in Canada;
the candidate must own at least 10 per cent of the voting rights in the corporation, and;
no other person can hold 50 per cent or more of the voting rights in the corporation.

As many as five candidates can have their permanent residence application supported by the same business investment.

But that can come with a risk. Certain candidates may be designated as essential to the business. If any of the essential candidates withdraw their applications or are refused, all other candidates under the same business investment will see their applications terminated.

Surveys suggest SUV candidates usually go on to succeed in Canada, in terms of growing their business, attracting further investment, networking, or selling their business for a profit.