Hopes and Realities of Canada’s Start-Up Visa Program

Canadian Startup Visa Program on The Startup Talk Podcast



Canadian Startup Visa Program on The Startup Talk Podcast

Taking a deep dive into the hopes and realities of the Canadian Startup Visa Program with Siavash Shekarian of Shekairan Law. With lots of immigration and Startup Visa Q&A at the end.

Automated Transcript of Canadian Startup Visa Program on The Startup Talk Podcast with Siavash Shekarian

SUMMARY KEYWORDS

business, permanent residency, canada, designated, startup visa, startup, incubators, program, organization, application, applicant, permit, visa, letter, support, people, question, months, requirements, canadian

SPEAKERS

Announcer, Siavash Shekarian of Shekarian Law, The Startup Coach

 

Announcer 

Direct from the sixth world renowned Canada’s largest city, with Canada’s biggest thinkers, visionaries and hustlers. This is startup talk featuring the founders, funders, innovators and community leaders who’ve led Canada’s startup ecosystem right here in Toronto. You’ll hear the challenges, the failures, the successes, Toronto’s StartUp podcast gives you the full story direct from the entrepreneurs and influencers who’ve made a difference. Now, the host of startup talk, the founder of TorontoStarts this startup coach.

 

The Startup Coach 

Welcome back to startup talk. I’m your host, the startup coach and founder of TorontoStarts one of the largest startup communities in Canada. And with me today is Siavash Shekarian of Shekarian Law . And today we’re talking about the Canadian startup visa program. welcome Siavash.

 

Siavash Shekarian of Shekarian Law 

Thank you very much, Craig. Happy Monday. Thanks for having me.

 

The Startup Coach 

It’s a beautiful Monday so far. And it’s great to have you. And it’s always great to talk about immigration in the startup visa program. But first of all, why don’t you tell us about Shakira in law?

 

Siavash Shekarian of Shekarian Law 

Shekarian Law is a law firm. We are a team of 11 people, a law firm with a very, very intense business focus. And our target market is helping foreign entrepreneurs come to Canada and set up or buy businesses here.

 

The Startup Coach 

So what is the startup visa program? And why does it matter?

 

Siavash Shekarian of Shekarian Law 

Okay, we’re we’re starting with the most difficult question, right? Because what are the start? We’ll start with Visa is obvious. It’s a misnomer in the startup visa program, because these are usually goes to a permit that you go somewhere temporarily, but the startup visa program in Canada, it’s a permanent resident program, but we can get to the book before talking about what is the startup visa program? What’s the startup? Craig, I start up is really any sort of new business or new entity that can scale well, like we don’t differentiate specifically in our community. So if you’re a small business that doesn’t want to scale behind a couple 100,000, we’re here to support you. But if you’re looking at a startup visa program, you’re probably looking at something that can scale to a massive level 10 million 100 million plus potential, otherwise, you’re probably not going to get the support that designated organization. Well, hopefully, because that’s exactly what the government was thinking with the startup visa program. They’re saying, we don’t really define startup. And nobody can really define startup mean, everybody comes at it with a different angle. But the way that the Government of Canada saw startup before designing and implementing the startup visa program was for us startup is something that as you pointed out, it’s something that can scale. But why why? Why does that matter for us, because if something is scales, they can create jobs. And if they create jobs, that leads to a better economy. And that’s why we like it. So the startup visa program, in essence, is the program that aims to attract innovative, high potential entrepreneurs we’re working on then again, innovative ideas, but does the law describe and define innovation? No, who does. And then we’re going into the details of the startup visa program. For the sort of visa program, anybody can apply, as long as they have a project or idea or a business that can get the support of a designated organization who are designated organizations. They’re either incubators, angel investors or venture capitals. So let’s say I’m a foreign person, I want to come to Canada apply for permanent residency, first, I have to contact one of these designated organizations. And if they agree to give me a letter of support, that’s requirement number one for distort a visa program with that letter of support, I just have to show that I have enough money to come to Canada and settle for the first year very low threshold for a family of one is about $14,000. And it’s a it’s a chart that I can share the link with you and you can share with your audience. So one letter of support enough money to settle in Canada, language requirements, you need to have a CLB five and that’s around Isles five. So again, very basic English requirements, and a qualifying business by qualifying with business what do we mean? The business that gets the letter of support from a designated organization who wants to come to Canada has to have more than 50% of its voting shares owned by applicants, and applicants can be one to five people and designated organization. So basically, if you want to be a qualifying business, more than 50% of the voting shares should be owned by the group of applicants and the designated organization that give as giving them the letter of support. So then again, for requirements letter of support qualifying business, which really goes to ownership of that business settlement fund and English requirements. You have these four, you can apply to become a Canadian permanent resident. And also you can apply to get a work permit because your permanent residency application is going to take some time to process and as of today, we’re talking 32 months, which for lack of a better word, a shame for a startup visa program, the time sensitive program, as you know, you know, innovation is very time sensitive, but that’s the reality right now. So for permanent residency, you’re expected to wait in the lines for 32 months. But at the same time, the legal structure allows you to apply for a work permit, use that work permit to come to Canada, start your process sooner work and start working on your business sooner and then transition into permanent residency. So that’s the sort of visa program in short, and how it works.

 

The Startup Coach 

Great, we already got a first question on the chat room, and we’re going to be dealing with it about processing time. So we’re going to talk about that a little bit later. What are the qualification requirements for the Canadian startup visa program? You mentioned some of them but the Canadian language but what are some of the other ones?

 

Siavash Shekarian of Shekarian Law 

Well, the qualification as I said, it depends how you define them and whose perspective you’re talking about. Because as far as the Canadian government is concerned, as far as the law, immigration law portion of it is concerned is get a letter of support, have the CLB five English language requirements have enough money to settle and have a qualifying business. So as far as the law is concerned, you have these four requirements. But as far as the designated organization wanting to give you a letter of support is concerned, everybody defines it differently. You know, for some innovation means x y Zed for some means x y Zed plus this plus that, plus that plus that. So everybody gets to come at it, from their own perspective, look at their own portfolios, is this business matched with us doesn’t match with us? Do we want to see the team? Do we care about the team? Do we care about their experience? Do we care about the sector, these businesses and that all goes to the decision making process of the designated organizations that the applicants apply for?

 

The Startup Coach 

Now I did a video on the letter of support getting a letter of support with a VC with an accelerator program and with someone else on and if anybody’s interested in that video, email me afterwards, I’ll post a link to it. I gotta do some editing, because but if anybody was that, specifically about what they were looking for and letter support, how that letter support goes through it yes, or no types approvals will get I have a video specifically get into that. So email me message me, I’ll happily send that. What is the application process like?

 

Siavash Shekarian of Shekarian Law 

Well, it all starts with the designated organization. So if you think you have a business idea, a project that is innovative, high potential growth, all of those vague terms that we discussed in the beginning of this interview, if you if you think you have that, I suggest you go to IRCC websites, and that’s the immigration refugees and citizenship Canada in charge of delivering implementing immigration laws of Canada. So go to their website, search for the startup visa program. And then under there, you see a link that will take you to the list of all designated organizations. So basically, the process starts there, look at the designated organizations that you think you can pitch your ideas to. And usually, most of them, they have websites go to their websites, look at their basically look at their taste is your business, something that you feel comfortable pitching it to them pitch, and then carry out that that process. And then when you have the letter of support, it just becomes a matter of putting your permanent residency application or your work permit application together. So that part one of the process is really go after what matters most. And that’s the letter of support, and you have to get it from third parties designated by the government. And then after that, just you get your PR application work permit application, and then you enter the long queue that we currently have.

 

The Startup Coach 

How does someone get support from those designated organizations? And is it different from for the different types of designated organizations?

 

Siavash Shekarian of Shekarian Law 

Oh, yeah. Oh, legally speaking, if you if you were getting a letter of support from a venture capital, that letter of support should also come with a commitment to invest at least 200,000 Canadian dollars in your business. If you’re getting a letter of support from an angel investor group, that letter of support should accompany a commitment to invest at least $75,000 Canadian into your business. But if you’re getting a letter of support from an incubator, there is no legal requirement for commitment to invest in your business. So that’s the legal part of it. But then again, how do you get that letter of support? It really matters, you know, my I’m, I’m a desert. I’m an incubator ABC. And I only want to take in businesses that have a proven track record of at least $1 million in revenue for the past two years. Or I’m a designated incubator XYZ and I want to take in businesses and I don’t really care, you don’t have revenue, it’s just a napkin idea will pay me and often, There is your letter of support.

 

The Startup Coach 

That’s really not a good route for most people is it just give us love money. And

 

Siavash Shekarian of Shekarian Law 

see that’s that’s that’s one of the realities of how this market currently is set up. Because, look, as of today, we have 41 designated incubators, we have nine designated angel investors. And I think we have 25 venture capitals. But if you look at this statistics that we got from the Government of Canada under the Access to Information Act, now, we know that as of July of last year, 82%, of all startup visa program activity belongs to incubators. 15% belong to angel investors and only 3% belong to venture capital. So the most active in this ecosystem are incubators. And out of those incubators, the most active one, getting 22% of the businesses is the one that has been named in numerous federal court cases, being proven that they’re not abiding by industry standards, as determined by their peers who are their peers, the rest of the designated incubators and angel investors. So on numerous occasions is determined that you’re not abiding by industry practice, you’re getting the most volume of this business, and you’re charging the most exuberant of fees. And then, of course, you know, so you’re saying, yes, the startup visa program is actually being used by many that are just wanting to buy a passport, and they don’t know anything about being an startup entrepreneur. And also, they just have the money, they pay the money, they get something on paper, they get something, you know, interest looks and sounds, but it’s empty inside. But at the end of the day, hey, you know, this is this is, this is a way to buy a passport. But then at the same time, you have incubators that take you very seriously. They do everything they can to help you succeed in this country, or, you know, under the circumstances of the sort of visa because at the end of the day, you’re in, you’re in an immigration limbo, right? Imagine you were you were a VC associate, you were a VC partner, and you’re deciding on investing in a very innovative high potential business, and then you’re like, oh, I have to wait three and a half years for the team to get some certainty visa vie their immigration status. And nobody knows what’s going to happen. Because when you get a lot of bogus files, what’s going to happen? You know, people are gonna, it changes perspectives, it changes the default that an officer looks at your application. When a lot of bad players enter the market, it’s natural for an officer deciding on your paper, even if everything’s good, they want to doubt and when they want to doubt you, they want to say, Oh, you’re not genuine. And that’s the end. And that’s the ground because this is good. I’m going to open the brackets here, under the sort of visa program. It’s a very mechanical determination, right? Do you have the letter of support? Do you have the English requirements? Do you have the money to settle? Do you have a qualifying business? It seems very mechanical, then how do they reject you? How do they refuse your permanent residency application, they do it under another section of the Act, that really says the officer deciding this case, should convince himself or herself that the primary intention of the people applying for permanent residency was for the business and not for gaining an immigration privilege. So basically, that’s all the activity happening, the officer has to be convinced that you are a genuine entrepreneur. Well, what’s the definition of genuine? How do they determine to your genuine? How do they determine that you really want to work on this business, and you’re not here to buy a passport? Or that’s another gray area that, you know, requires another session of its own? How does that process work?

 

The Startup Coach 

Great points all around. And you know, they have to figure that out. And how do you put frame though that perspective? You know, when people are trying to suss out, you know, are you real business? Are you coming in here? Are you just just trying to get in a sneaky way? Who reviews the startup visa program applicants? Is it just people from the designated organizations?

 

Siavash Shekarian of Shekarian Law 

No, it’s not. The people from the designated owner organizations, they often don’t you know, percent of the time, they don’t want to take any responsibility. If they if they’re responsible actors. They don’t give you advice on the immigration matters. You just want to say, Oh, we reviewed your business. It’s good or it’s bad. If it’s good, we want to take it, we want to support it. And if it’s bad, go to this change that change and then come back again. But who reviews your application for permanent residency or for a work permit? That’s immigration, Canada’s IRCC and an officer sits down and looks at your application and wants to determine Well, the mechanical side of it, as I just explained, is very simple. You know, half the letter of support half To start, it’s very mechanical. But then the majority of the time that then officers spends on a Start Up Visa application, whether it’s a work permit, or whether it’s a permanent residency application is to figure out, are you the real deal or not. And they have to do it based on, you know, whatever, it’s before them. We mentioned this earlier before we started, but what is a essential person when it comes to the startup visa application process, when you get a essential person designation that enables you, as I said, startup visa program allows you to make an application for permanent residency and permanent residency is, you know, it’s, it’s, we allow you to come and be a permanent resident in Canada, right. So it’s not temporary, but work permit, it’s temporary, right, we are allowing you to come to Canada for a specific reason. And for a definite period of time. If under the sort of visa program, you want to qualify to also apply for that work permit, you have to be designated as essential in the startup group. So let’s go at it again, on every startup group can be from one person to five persons. And each of these persons if they want to get a work permit, they have to be designated as essential who designates them while the designated organization giving the letter of support a letter of support is a document it’s a form is very simple form in there, you have designation is this person essential or not? If a person is decentral, then they can apply for a work permit. But there is a catch when you are an essential person in a startup group. If the permanent residency application of that person is refused, then everybody else’s applications will be refused. And if you want to get that stuff that work permit is not just a designation or you are essential, you have to explain your essential to come to Canada earlier than the permanent residency decision of your application. Why? What are the urgent reasons that you want to come to Canada sooner? So you’ve got to be able to define and explain why there is that urgency for which you want to come to Canada earlier. So here’s the thing as essential person allows you to apply for that work permit caveat is if if your application as an essential person application is refused everybody else, applications in that group will also be refused. And you have to explain what are those urgent reasons for which you come to you want to come to Canada earlier than the determination of your permanent residency under your PR application?

 

The Startup Coach 

And what are the typical things that you’ve seen, that they would apply, that would make them essential that they need to come earlier?

 

Siavash Shekarian of Shekarian Law 

Well, it’s it really is different for any effort for every business, right? Some some of some of the very ordinary reasons is I want to come and incorporate in Canada, you know, if COVID caught us one thing, a lot of things can be done virtually right. And without the need for you to be physically present here. If you have good advisors, if you have a good deal if you have, if you have a good lawyer, if you have a good business consultant, if you have a good team of advisors and networks, honestly, there is a lot you can accomplish without having the need for your physical presence here. But then so many businesses are definitely want to come here and you want to go negotiate, you know, you don’t want to lose that face to face effects of having a meeting with someone and trying to pitch to them, whether it’s an investor with a single supplier or whether it’s a customer. So it really is different for every business. But what is what is common among them all, they have to sit down and have a very sober determination. And when I say solver, I mean, don’t look at it, oh, I want to go go to Canada sooner or earlier. Right? Because coming. Usually, when you’re coming to Canada, especially from emerging markets, you know, there’s a lot of costs associated which you come in here and that cost assumingly is going out of that business. So you have to make a business decision. Is it better if I use all of that money that I want to be spending in Canada and put it somewhere else delay my physical presence, then my PR Decision is made? Or no I can’t I really have to be at that pitch event which is in person I have to really be at that event, which I’m you know, selling to these customers. So it really depends on your business.

 

The Startup Coach 

You mentioned money on not only have we talked about processing and application fees and stuff, but you need to come in the cost of coming and living here. So one question is how much does the process cost? You know, is there a low and a high end to how much money do you have to show that you have in order to be able to support yourself coming here?

 

Siavash Shekarian of Shekarian Law 

As long as how much money you need to show that you have that would be proof of settlement funds because the government wants to make sure that you know if you’re giving your permanent residence, you didn’t want to ensure that you have enough money to at least settle right so that as I say.  It goes by the number of family members in your family. So if you’re a person of one, you need to show that you have $13,310. If you’re a family of 216 $1,570, family of 320 $1,371, and then it goes on. So that’s how much money you need to show you have as settlement funds to check that mechanical requirement. How much does the process cost? Well, the biggest chunk of the cost oftentimes goes to the designated organizations. And I said, we have amazing ones that are giving services providing services for free, and we have terrible ones that are charging in excess of $100,000 per person. So it really depends where you go. But the another thing that you have to pay, regardless of where you go in terms of the designated organization is the application fee that you pay IRCC. And right now is $2,140, for the main applicant, and on their 1500 for their spouse, and $225 for each child. So that’s so the cost is application costs, which is an expense out of your pocket money, you need to have settlement funds. And then the biggest chunk of how much I have to budget for or how much I have to put for this process really goes to which designated organizations you are working with.

 

The Startup Coach 

One of the questions I get asked a lot is What if my business fails after I immigrate to Canada with the startup visa program?

 

Siavash Shekarian of Shekarian Law 

Oh, that’s a great question. Because failure or success, then again, vague terms, but let’s just accept them as they are. So let’s say business success is not a legal requirement. So nobody judges you on the success of your program off the success of your business. All we care, as long as you know, as far as this Canadian startup visa program is concerned is we want to see you genuinely try. So if you genuinely try to make something out of your business, we are happy. And when I say we policymakers, at least that intention that was there to define something like the Canadian startup visa program, because we are not the only country doing this in the world. There are 25 Other countries doing it. But we remain the only country that we give out permanent residency from the get go. All the other countries they say hey, come prove yourself to me first, I’m gonna give you a work visa come here. And then after three years, let me see your reports. Did you make anything out of this business? Did you hit that target? Did you hit this target? Then I decide what I want to take you to a stream of permanent residency, Canada, Todd, hey, talent war is real. We got to win it, how do we win it? Let’s give them permanent residency from the get go. Which is a good thing and a bad thing. We don’t want to discuss that that’s, you know, that’s a pot that that’s a policymaking issue, really. But as things stand right now, we give you that privilege. And we say, hey, we don’t want your success. We know we understand 98% of startups or even more, they fail. But you know, we’re after the 2% that they succeed. But we want to make sure that if we were giving you this privilege, we want to make sure that you’re genuinely trying. So success, it’s not an indication.

 

The Startup Coach 

Now, you mentioned language requirements. I think you said CLB, level five, I don’t know what that is, Can Is there a softer way of telling us? What level of English I need?

 

Siavash Shekarian of Shekarian Law 

Basic, it’s basic. It’s basic, it’s basic level of English, like honestly, let’s CLB five is one of the lowest language requirements that we have in all the 120 130 immigration programs that we have. And the reason why we have such a low language requirement for this sort of visa program is really you know, to incentivize those entrepreneurs, hey, you’re not comfortable. But your English, you’re not advance. It’s okay. Do you have a you know, high potential business that you can bring to this country, but what’s really missing is sure I don’t have good command of either official languages of Canada, but then again, I go to a designated organization that is completely culturally blind to my specific needs of a foreign entrepreneur, despite having a very great business idea, right. So something’s always got to give. But from a policy perspective, it’s, Hey, we want to lower the English requirement, because we want to incentivize you to come and apply for the Canadian program, do not go to the 24 other countries that are doing it because we need you here in Canada. But then of course, there’s some you know, something’s got to give always.

 

The Startup Coach 

So we talked a little bit briefly about some of the problems with the program. And our first question came early on it pay save ash, is there any chance that the processing time goes down because 32 months for a startup is much too long? What are your thoughts on the processing time?

 

Siavash Shekarian of Shekarian Law 

Hmm. Well, that really depends, because that’s a government thing. Right? The Minister of Immigration has the discretion. We as Canadians, you know, we have given them that discretion, we have given them that discretion, hey, you get to decide how do you want to define your levels, you know, right now that the new immigration level plans that the government that IRCC has has has tabled says for 2022 2021, there was 1000. And when I say 1000, is not only started visa program, startup visa program is coupled with another federal business program, self employed program. So all those programs together, you have a capacity of 1000 for 2022, it is going to remain 1000. And then it’s going to jump to 1500 in 2024. So 2022 2023, we’re going to be at 1000. And in 2024, we’re going to be at 1500 sobering fact right now. And as of July 2021, we have 6442 startup applications in inventory that have not been touched yet. Meaning they’re sitting there, we’re not touching them. So we’re telling you right now, believe it or not a month ago, even I don’t know when they updated it, because you know, we look at it frequently. That’s one of the, you know, struggle programs that we have. And I saw today, and probably it has been changed in the past few days, the government’s website is now telling you that the processing times to be two months, because before this, they kept the old number and the old number was 12 to 16 months. So right now, is there a chance for this processing time to go lower? It really depends on the government, you know, how they define their priorities? Do they want more innovators? Do they want more high potential startups like Shopify world Flyboard, to come here and create 1000s of jobs or no, they don’t care. Because right now, what it looks like they don’t care about this program, as much as they care about other integration programs, as we are seeing for the capacity that they have for it, and also the, the processing time that they have for it.   But hey, this is a platform, you know, we are raising awareness government, if you’re looking if you’re watching, do something about this, because there’s a lot of potential here. We can happen to be critical. But that’s just because we’re all looking for answers. How do we make it better for everyone? And when you say there’s, you know,

 

The Startup Coach 

I think you said 6000, some odd that are in the queue that haven’t been touched. So if we apply now, or we, you know, 6001 6002 doesn’t matter where we go, whether we have a deal, whether we have a VC investing, we’re just get at the back of the queue and wait,

 

Siavash Shekarian of Shekarian Law 

you get to the back of the queue and wait, and that’s one of the big ones. That’s another big problem with the startup visa program in particular, but the whole immigration system in general, nobody cares. I’m a lawyer, and I’m dealing with numerous clients, right? And the IRCC treats me very poorly, they call everything that they do lines of business. So you assume or they look at it like business and any business, you know, business one on one, customer service is paramount. There is none, there’s virtually non existent, you know, you send them an email three months later, you get something generic, that doesn’t solve anything for you. You know, and not imagine you’re doing something genuine. Right? And this is this is the problem that I have with with Canadian immigration system as it’s being implemented right now. It invites you not to be genuine, right? Because if you’re a genuine business person, and you’re working on your startup and you’re trying to negotiate, and being a startup entrepreneur is particularly difficult, right? Because you’re in a risky venture already. Sometimes you need to know more traditional brick and mortar businesses so you’re dealing with less risk but as a startup entrepreneur, you’re doing a million things at the same time and time is important and you need someone that is accountable to you. You know you’re paying 1000s of dollars to the Canadian government for processing your application so you expect if you’re sending them something hey, my situation changed you know, yesterday this person was essential but today we decided he’s better to stay back home but I come for this and that they don’t they don’t you know they don’t get back to you. That customer service that kind of line of communication did you move to be okay, I’m going to Country Canada is great. I want to take my startup there. Hey, look at how they’re treating me. You know from step one, you know they’re responsive, they really want me there while the government side of it is totally gone. Designated organizations, you know those most of them unfortunately. Well when I say most of them, most of the active ones, they don’t care either they just want to get your money and say hey wait this is this is how it is so if you just imagine you’re you know you’re you know genuine entrepreneur you’re like why Canada you know there is there’s France you know they give me they give me a free grant they give me free office space they give me free mentorship there’s Chile same thing. They just one knee there and when I when they take me there, they invest on me. But Canada is like okay, what’s what’s what’s your distinction? Permanent Residency? Sure. It’s great. Yeah, of course Canada is a great country. Everybody wants to be here, but But that’s not you know, that’s not the only thing that matters.

 

The Startup Coach 

You talked about program integrity, you know, and one of the questions we have is with just a few papers, how can the our IRCC judge if a start up is genuine or not?

 

Siavash Shekarian of Shekarian Law 

Yes, you can definitely you can I, if it was up to me, I would give, you know, I would trust but that I will verify what do I mean by that? If I’m designated organizations, I put the pressure on designated organizations. And what what do I mean by that? I will go check them, I’ll make sure they do their job correctly, because I have already delegated that part to designated organizations because look at it, you know, so the visa program came about in 2013. Right? What program did it replace? It was an entrepreneur program that we had, basically, you had to show you how $300,000 By a business, show me this and show me that but all of those things, had to be analyzed and decided upon by an immigration officer. But in the new way of doing things we realized correctly. So why do we have to engage an immigration officer with particulars of a business? They’re not business consultants, right? They’re not business gurus. So why do why should we give them that job? So we said we’re going to delegate we’re going to outsource decision making about the business should go to designated organizations. But then if we do that, if you’re delegating, if you’re saying, hey, designated organization XYZ, XYZ, we trust you, we give you this designation, give a letter of support to this business, and we have to trust you, right? And then why are we coming and saying, oh, no, you were, you know, we have to take you to court, the client has to take you to court and then peer review process. And then we know you didn’t play by the rules as a designated organization. We do not do we do not D designate you we let you keep your designation, but we refuse everybody’s files have worked with you. So program integrity, yes, part of it goes back to me as an applicant, because I still can be an entrepreneur and you know, cheat everybody. Sure, you get two examples. Every every time in every system, you have bad actors. But I think the most most of the effort should be spent on the system of designation, maintaining that designation and being accountable right now if you go see if you go to the IRCTC website right now I’m an entrepreneur, I’m a Foreign entrepreneur, I know nothing about this, this program. I just have a great idea. I look at it, I have about 100 designated organizations I other than Vc Angel incubator, I don’t know their difference, right? So why not just tell me how many you know, just be transparent with your customers, right? And I’m talking I’m saying this to RCC being trans, be transparent with your with your customers tell them this incubator had this many applications of which this many were approved, of which this many were refused and tell them this, this, this incubator has been to court many times and has been designated for not having, you know, abiding by study industry practices. So, right now, everybody, the least person that the system cares about is the applicant, right? And that applicant is always all the questions. They’re coming to you show me what you did you know, you made an application six months ago, show me where you are now, or you made an application right now with these processing times. They’re going to ask you a certain application three years ago, and show me where you are right now on based off where you are right now. They’re going to make that determination whether you’re genuine or not.

 

The Startup Coach 

Agree, we got a lot of questions here. I’m seeing them pile up. So I’m going to just start into it. How soon can you apply for work permit upon receiving the letter of support and meeting the other criteria.

 

Siavash Shekarian of Shekarian Law 

As soon as you have, as soon as you have, as soon as you have the requirements, you can apply for that work permit letter of support. Proof of settlement funds for settlement funds for work permit is a different table, they have higher requirements, but for permanent residency is a is lower, but then again, when you can apply as long as soon as you have all the requirements, just get your application to get the rest of it. There’s a waiting period.

 

The Startup Coach 

This is a common sort of thread here. Do you have specific designated organizations that you work with?

 

Siavash Shekarian of Shekarian Law 

We do in our practice, we have preferences, and we have worked with many of them. And you know, you know not you can know anybody unless you work with them. So so many of them, we know we have had very good experiences working with them. We see them that they really care about clients, and others we see you know, people come to us and they say, Oh, we already have this letter of support, but we have this issue. We want to do this restructuring to our business. We want to get this we want to get that and we look at how the D O has treated them and it’s just, you know, very poorly. So there are of course there’s you know, as I said, you know out of those 41 incubators that you see listed on the IRCCs. website, you gotta go to the ones, I would say, try them all, why not? Because you don’t have any other option? Why do you want to, you know, take my word for it, right? Just go there, try them out, see them do your research, you have to do your due diligence, you know, that’s the part that is on you, as an applicant, make a list, look at the first start with your website, just get a sense of their tastes, what kind of portfolio they have, what kind of businesses they’re interested in, and then don’t just just reach out, you know, some of them you reach out to, they don’t even get back to you after five months, you get a generic email, Hey, you, you shouldn’t have applied to us first apply to a business partner, that is going to charge you this many 1000s of dollars and then come to us. But some of them you know, they’re responsive, you know, you get an associate there, they come to you, they talk to you, they look at the business, they give you a review, they give you an honest opinion. And then if they support you, they really you know, which you throughout that process. So just to summarize it, you really do your own due diligence when it comes to designated organizations, just don’t go to the ones that are the easiest, because you know, the easiest, are usually also the more expensive ones. And quality wise, you can’t really count on though.

 

The Startup Coach 

Now a lot of people have asked us to name names, either of the good ones, or the bad ones. And I’m not sure that’s wise. No, I don’t think so. Because, you know, in Canada, we are, we’re extremely conservative, you know, we’re not gonna go.

 

Siavash Shekarian of Shekarian Law 

I don’t know, maybe sometime from now. But

 

The Startup Coach 

if you’re live at an event with me, I’m happy to discuss the people I work with. There’s people I mentor with as part of these designated organizations and programs. But yeah, do your own due diligence and, you know, talk to people reach out to people and you know, they’ll tell you their experience, reach out to organizations who have been through the programs, and find out what they have, you know, if you’re reaching out to them, say, Hey, can you give me a list of people who’ve been through your program, reach out to them so you get their experiences? Again, in person? I sure we’ll both tell you what we think. But on a public forum such as this, it’s probably not best for us legally. Next question I founded by blockchain web three company in 2019. And we have been growing since then. I’m not a permanent resident holder, nor citizen, I just have a work permit. I have a local employee and a remote employee, we are looking into this program, and it feels that they’re aligned with 10 acts. And we’ll check the list for the designated organizations. Okay. There are a question in there. Sorry, I thought there was a question. I guess that. Yeah. Sure. You know, we got a few questions about which incubators are serious about helping startups and again, not the 22% part, do your due diligence, all the incubators will tell you about postgraduate. So check the year before and the year before that, and people who graduated their program and talk to them.

 

Siavash Shekarian of Shekarian Law 

Yeah, and also talk to the designated organizations directly. You know, and I see this so often people, they say, Oh, this, this, this person had a good experience with this do. But they didn’t, you know, they didn’t treat us well. Don’t just count on other people’s experiences, because everybody’s experience is going to be unique and different. Look at how the system works. You know, if the system treats you well, if the system is responsive, if the system cares about your needs, for go work with them, if not try others and then make it you know, and then make make make a reasonable decision. Because maybe at the end of your process, you realize, hey, none of these designated organizations are catering to my specific needs, then there you got to make a decision, at least you know, you exhausted your due diligence, you did your own research. And now you have to choose, I hope your choice comes down to good and better. But oftentimes you get to choose Oh, bad or worse. So I have to I have to pick one. But at least you did your due diligence, don’t just count on, oh, this person had a good experience with that guy. So let’s just go there and forget about the other 29 that can be a much better fit for what it is that I’m doing

 

The Startup Coach 

Another question,, but what’s the best approach to deal with VC organizations, specifically and industrial sectors like biotech? Is there a specific distribution for different sectors in Canada when you’re applying?

 

Siavash Shekarian of Shekarian Law 

Not really done? Again, they’re all equally listed under the list of designated organizations, but go to each of their websites. And they tell you and one of the things that we said in the beginning of this interview was that venture capitals as of at least July of last year, since the program got permanent, in 2015, they had only 3% of the share of the applicants 3%. And that’s a very, very low number. Why is that? Because they’re going to have to commit to a $200,000 investment. And often they do not feel comfortable even committing because that doesn’t mean if they commit to you today, tomorrow they have to release To the check, no. But nonetheless, the ones that are genuine and serious, they do not want to commit to something that big in an immigration limbo. So if I would say, if I were to give you a recommendation, if you’re looking for a VC Sure, try the startup ones, but try every VC out there and try, you know, it’s tough, it’s difficult, because you know, you’re not a Canadian company, and you’re not a CCPC. Ed, you’re not, you know, you’re not going to be eligible for a bunch of numerous great things that we have in Canada. So you’re gonna have a tough time. And under the sort of visa program, as I said, it doesn’t seem like that the venture capitals are comfortable based on the very low participation rate that I just gave you a 3%. They’re not comfortable investing in startups that are still in an immigration limbo.

 

The Startup Coach 

If you’re approaching the VCs, approach them like, they’re going to invest, because that’s the whole thing. You’ve got to target the specific ones that work with your group and their area. Reach out not with a long note, but with a short note, what you do, what area do where your traction is, and, you know, see if you can start a conversation. So VCs is just like trying to get investment, because in the end, you’re trying to get investment from a VC in a VC do so get your pitch straight?

 

Siavash Shekarian of Shekarian Law 

Yeah. The only thing I’d add to that, and go into that process and knowing and there is one thing working against you. And that’s your immigration status, at least under this sort of visa program. Because everything that Craig said is absolutely right. You know, that’s how you approach a VC, you just want to go pitch, you know, be at your best give your best story. But then at No, you know, when it comes to negotiations, you’ll be like your idea, but hey, what about 32 months? And we don’t know if you’re gonna get a work permit or not, or all of that just know, walk into that meeting, knowing that there is this thing working against you?

 

The Startup Coach 

Is there a magic number of funds that a founder needs to invest in a startup or interpretation of the financial slash budget?

 

Siavash Shekarian of Shekarian Law 

Now, some some designated organizations, then again, it’s a deal thing? Because the program itself the way it’s structured, right now, it doesn’t require you to give an investment commitment, no, but do some of the deals, we’ve seen that they’re asking for good reasons. And they’re saying if your business is at this stage, and if we want to move it from this stage to another stage, we need to see that you have the financial capacity for moving it. So it’s some deals they ask you, how much do you want to invest? How much do you have some they even asking for their commitment, they want to verify it, some they don’t care. But as long as the program and for this is a legal perspective, as far as the program itself is concerned, there is no requirement on the applicant for making any financial commitment to the business. If someone enters with work permit, and considering the startup visa program, application processing time of 32 months, it looks hard for someone to sustain completely on own funds in a new country. But again, in part, we see that many designa organizations hungry for money, they do not do the due diligence, ask for money to manage everything for the applicants. Again, sorry, I thought there was a question. That’s a great point. Do I think everybody needs that? That’s a great point. You know, it’s because that’s absolutely right. You’re coming to this country? And it’s, you know, it depends on where you’re coming from a Canada Hey, Craig, Canada is one of the most expensive countries in the world. I think right now, you know, it’s an, it’s a shame, that we are one of the most expensive countries in the world. But hey, that’s, that’s a fact as a reality. We’ll talk about why it’s that hopefully, another talk, but I think Stan, right now is an expensive country, so you have to budget for it. And then yes, with 32 months of processing, so you have to be very, very, very smart about how you define your business goals. Just make sure that if it’s not absolutely necessary for you to be physically present in this country, do not make an application for a work permit. Because you’re coming here and your work permit is a closed work permit. This is something that you have to remember, you know, your work permit only allows you to work for your startup company. And if you’re not yet at a traction level, and if you’re not yet at the level that you can at least pay yourself some salary from the business. So you know, forget profit, can you just, you know, meet the expenses that I have if you’re not at if you’re not at that stage. Just be very smart about making that decision for coming to Canada with a work permit under the sort of visa program.

 

The Startup Coach 

What is the approximate processing time of incubators after all the criteria is met.

 

Siavash Shekarian of Shekarian Law 

Well, some, they only have a really it again, it really depends on the designated organizations. They only have one intake of applications in one year. So you Apply by certain date, they take some time and then they say, Okay, come back for second round, third round and then you’re accepted into the program. Some you send them the, you know, you send them, whatever you have today, you know, next Monday they say, Hey, this is a letter of support just pay us this much. You pay, you get the letter of support. After the letter of support. It’s just a matter of the program. You know, and everybody’s different. If you go into an incubator, you know, the name suggests they’re an incubator, they have to incubate you. And usually they incubate you based on a program, right? So some say our program is customized tailor made, it really depends on you, some say no, it’s a six months programs, some says a 12 month program, 18 month program. So it really depends on the designated organization. If you’re going into an angel or a VC that’s different, they usually give you a roadmap, okay, we give you a letter of support, this is the commitment out of this $200,000 20,000 will be released, if you hit milestone 123, the next 20,000 will be released Moscow 567, whatever, it’s, again, it’s a designated organization by a designated organization assessment.

 

The Startup Coach 

Another question, about the same thing is processing time for incubators, in terms of getting the letter of support, post application, really, for incubators, it’s all about their program. So the program is usually quarterly or twice a year. And they start on a certain date. So when you talk about application time, they have it clear on applications are open from here to here, and the program start date is here. So it’s pretty clear on it’s only a few weeks between, you know, the close of the application processing and the start of the program. Do you have any thoughts on the processing time from application to going through the process?

 

Siavash Shekarian of Shekarian Law 

No. But again, it really depends designated organization by designated organization, you get the letter of support. And then after letter of support, just make sure that you make your application to IRCC. So the clock starts ticking for you sooner than later. After that, it’s all about this huge this this this, this is something that you have to always remember, when you get a letter of support from from a designated organization, it comes with a service agreement, especially if they’re serving you and incubators, 100%, they’re serving you because that’s their job. And in that service agreement, you’ll see, you know, you have to be very careful reading that agreement, understanding that agreement, knowing what the responsibilities are and knowing what your responsibilities are. But that’s where you see, what is this program? Do I get a advisor that is just going to have a meeting whenever I call the advisor? Or is it one of those structured programs that no, we’re going to have a meeting every week, and there’s some certain things, the advisor gives me homework and the program duration is for six months, 18 months. That is something that comes after the letter of support. And when you have the service agreement before that when you want to get a letter of support, then again, that all depends on the designated organization and how quick they are. With getting back to you. Some of them are just simply swamped because you can’t believe how many applications they get on a daily basis. You know, Canada is a popular country is probably one of the most popular destinations for every prospective immigrants in the world. So understandably, they’re getting tons and tons of meritless applications like basically the Maryland’s it takes time for them, you know, to read them to qualify them. Again, as I said, designated organization different from designated organization,

 

The Startup Coach 

Is there a six month period or threshold that my funds need to be on the financial document as proof of funds for work permit or permanent residence.

 

Siavash Shekarian of Shekarian Law 

That’s what the for the permanent residency, that’s what the instructions say. They say, prove us your settlement fund and show us that you have had this money for the past six months. But not all situations are ideal. You had a car yesterday you wanted to sell you had something saving that had to be transferred that had to be converted in cash. So if you don’t have that six month period, just make sure that you have an explanation letter why I didn’t have these funds for the six months that you want it. Basically what the government is trying to see here is, is the money you’re claiming you have yours, or did you get it from somewhere and you want to pay it back tomorrow? So all they have to convince themselves is no this money really belongs to you. So if you don’t have six months, if you sold your car, two days ago, you put the money in the bank and you want to get a bank statement tomorrow, just make sure that you have a letter of explanation that hey, this is the font that hasn’t been in my account for six months, but the money is mine. This is the car sold. And this is just an example that I’m saying.

 

The Startup Coach 

That was a great example. Good info. Do we need to submit a detailed progress report from the time of applying for permanent residency if the IRCC requests for an ADR? I’m not sure what that is? Or have anyone entered for peer review?

 

Siavash Shekarian of Shekarian Law 

Yes, so this is what this is the structure of the program. I’m going to explain this a little bit. If an officer is looking at your file, and if not officer believes that there’s something wrong, that you are here to buy a passport. Often they can. They don’t have to. But often they send your phone to peer review, what’s peer review, who are the peers, the peers of your designated organization, if you’re an if you deal is an incubator and an angel investor, their peers are going to be the same, the entity in charge is nickel. So nickel sets that up, nickel creates that panel, your files go there without your name. Without your specific information and the peer sit down together. And they really want to decide that this business organization do its due diligence. Was this a business that has some potential that has potential? Or no, if not, the peer review comes back and say, Hey, we’re not convinced that this designated organization gives you the letter of support based on industry practice. And then the officer can take that and say, based on this review, I’m refusing your file. So that’s so that’s what happens in terms of a status report. And what are you doing with your business it’s always best practice to document everything you do. Whether it is for sort of visa program or any other business that you do documentation is very important. It’s it gives you you know, that that point of reference of everything you do everything you plan to accomplish. So make sure your documentation is there in order document everything everything you do so when people ask you, Hey, are you a genuine startup visa applicant, then you want to be able to show for the past six months we held these many sessions we did pass we did we did this we did that you will be able to explain and give your story. Because that is exactly how I RCC wants to see you genuinely try our designated organization advise us to enter Canada on a work permit. What do you think is getting the Canada out of work permit will account for permanent residency success rate and not not? Not really not really. It? It doesn’t impact it positively. Nor does it impacted negatively? Because it really depends on the specifics of your case. The only time that I can say 100% Certainty do not get a work permit is because you say who cares about the business? I want to go there. I want to go to Canada sooner. So no, that’s that’s definitely a no, no. But if you are sitting down in your I don’t know, board of directors, whatever it is, however it is if you’re managing this, this this startup make a decision. Do we need to be in Canada? If we do need to be in Canada, then yes, we go and apply for the work permit. And we have good reasons. Because if an officer comes back to you, sometime down the road, and hey, say you cook, you came to Canada, you said there are urgent reasons for your business to be in Canada. What were those urgent reasons where you explain them in your work permit application, but the officer can say, Okay, did you do them? What’s your progress? What what did you accomplish with your physical presence? So it’s going to be a higher burden on you to show that yes, there were urgent reasons we came in. We did this and we did that. So going back to your question, if your designated organization is emphasizing on you having a work permit without any business reasons, that’s a red flag. And definitely inquire more Why do you want me there? If there is no urgent business reasons for me to be there? But if they’re genuine, and if they’re saying, oh, based on under your advisors, designated organization, what do they do? You know, in incubators, your mentors, your advisors, someone that you have to listen to, you know, you have to trust, because they’re the ones who know how the Canadian market operates and works. So if they if they if they really have some reasons for you, because of your business to be here, attend this seminar, attend that course attend that meeting. Sure, trust up, but blindly. And because there’s no urgent business reasons, never do that.

 

The Startup Coach 

I have seen some startups that are just waiting for permanent residency to start working for their startup. What do you think about this scenario?

 

Siavash Shekarian of Shekarian Law 

So many people so many are doing that they’re just waiting to get the permanent residency and come here? So he, here’s the thing, here’s the divide between how how government is looking at it and how a genuine applicant is looking at it. The genuine applicant is saying, Yes, I’m willing to do a lot of work for a business that I don’t know if I can be able to set up in Canada and go there. Because if you’re a business owner, and they tell you oh, we’re not going to give you an immigration privileges, more than 90% of the businesses, they say forget about Canada, you know, and those that they want to maintain Canada and still do business in Canada are big businesses that they don’t care about their people being in Canada. But most often, it’s that I want to know that if I get the immigration status, then I’m gonna go and work more and harder in this business on a more serious level. So government wants you to do everything you can they want you to bend over backwards, sell your home, make this business create jobs before they even want to give you the permanent residency. But you on the other hand, say hey, give me some certainty before I want to, you know, put more time into this business because that’s one of the important things often startup entrepreneurs what do they do when they have a full time job? They have another business that they see their potential. So they’re working two jobs, right? Nobody says this is a high potential business. And if you go to the history of the unicorns of the world, you see this, you know, playing out all the time, they’re having a full time job, they’re working on a small business, you’re working on that idea. They’re working two jobs, and then at some point of certainty, whether it’s, oh, I work with this mentor, now I can go to Canada, I can access wealth, I can access investment, then I’ll go there, and it becomes my full time job. But in that process, you know, you want some certainty. So that’s, that’s the divide we currently have. They want you to do everything before you’re here. You want them to give you certainty before you put in more time. And that’s the things we are right now.

 

The Startup Coach 

The IRCC refuse work permit for a startup based on the grounds that if the application came to Canada, he she won’t leave after completion of the work visa project is that you know, a common thing.

 

Siavash Shekarian of Shekarian Law 

It is a common thing, but you can definitely find it, you can, you know, seek professional advice because an officer regardless of the type of work permit that you’re applying for, it’s again, it’s a visa, so they have to make sure that you’re here for a temporary period, how do they make sure that you’re here for a temporary period, there is an assessment? How many times do you have to your country of residence, right? So in your case, they looked at it, and I’m assuming you already have a permanent residency application under this program, and immigration law, we have something very expressly expressly allowing you as an applicant to have dual intent, what’s dual intent, I already have a PR application, which you Canada, I’m telling you, my intention is to live there permanently. But right now I’m applying for a temporary visa. So just make sure that you that dual intent is expressly before the office or so they know. Right? And then yes, it’s a common thing. But then take a look at it, you need to definitely need to get professional advice, somebody to take that take a look at your cases specifically. But there are ways to overcome it.

 

The Startup Coach 

We have another comment here less of a question that there’s an angel group this person wants to work with in Toronto, because they speak their language. I’m not sure if they’re a designated organization, but reach out to that angel group and find out what designated organization they work with. If it is a group, they probably work with a couple. So start working through that one if that they’re the only people who speak your language. Any thoughts on that?

 

Siavash Shekarian of Shekarian Law 

verify them if see, designation, I think is the least important thing. Although sometimes I often get surprised in my practice that people even don’t do that. Simplest due diligence, the simplest due diligence you can you can do is just to make sure that they have the designation they claim. So if they somebody say x y Zed is a designated organization, jump on the IRCTC website, look at the list. Language, it’s important, right Canada we call what do we claim what’s what’s our identity? Right now, if you ask 10 Canadian, probably eight will tell you multiculturalism. So yes, you know, cultural match is definitely a big thing. But the overarching, is getting in, at least in English, Canada, English is the language. So one thing that I tell you before just learn that language for the sake of your business, the better you know, the better command of that language you have the higher chances of success for your business. But then there’s always, always always value to work with someone that culturally understands you. So yes, that is a strong point. But that should never never be the only point. Based on which you define your partnerships. You define your businesses, it’s an amazing point to be to be able to culturally relate, but not the only point.

 

The Startup Coach 

One last question here. I know we’re running late. Does registering a company in Canada help with the PR or work permit visa?

 

Siavash Shekarian of Shekarian Law 

It’s a requirement of the program. I didn’t really dwell on it. In the beginning of this interview, I said one of the four requirements under this sort of visa program is having a qualifying business to qualifying business is about ownership more than 50 50% being owned by the group of applicants, and the designated organization at the same time, they want you to incorporate your business in Canada. Now. That’s that’s that’s that’s one thing that the the reason why I didn’t emphasize it in the beginning is that the law allows you to even incorporate after getting permanent residency, but it’s always good practice to incorporate and when you incorporate, you know, incorporation on its own, it’s really nothing. But the way you organize your business is really important. So incorporate organize it structure that business and try to you know, be tidy with it. Make sure that you follow all the animal animal filing requirements depending on where your corporation is, but it really is important for your application. Yes, but also remember that it’s not the most in the early stages, as the law allows you if you have the intention. It’s okay for for as far as the legal perspective is concerned, but it’s always good. It’s good practice, of course, to incorporate, organize and structure your business.

 

The Startup Coach 

We ran late, is there anything they want to see? Well, yes, we will do we will do another session. Think of your questions, we’ll do another session, send them to me or just think about it. We’ll do another one in a couple of months. Do you have any tips? Or is there anything we didn’t cover for people applying for the program?

 

Siavash Shekarian of Shekarian Law 

Plan ahead for for people applying to the program. Honestly, plan ahead. Canada is a great country. I mean, other than the obvious country of freedom country, if this and dad which are very important, at the same time, we’re a very sort of friendly country. You know, we have we have numerous wealth and wealth and wealth of resources that you can use. And I think this other stakeholders like myself Craig, we’re gonna work together to make sure you know, raise awareness about this about this great program and the potentials that it can really have, you know, for our country today, and hopefully your country a future. And that’s, that’s the only thing that I think we need to end this with just, you know, keep the conversation going. Because right now, this this is a gem of a potential that we have, and we are not using it. We are not using it. And that’s that’s, that’s really bad. And I think we can improve on that a lot.

 

The Startup Coach 

And look for a bunch of more resources and videos and educational stuff coming in September and October. Around exactly this. We’re going to do a whole bunch of different sessions, so pay attention for those things. If people want to find out more about you and Shekarian Law, where do they go?

 

Siavash Shekarian of Shekarian Law 

Shekarian.ca. So just you know, Google, my name Siavash Shekarian and it will come up, you’ll find my firm. And then you can you can, you can contact us.

 

The Startup Coach 

And for people listening on the podcast, all the links will be in the show notes or on the chapter links as we went by. So just take a look and click those links. I really want to thank you for taking the extra long time today to answer all their questions and discuss the startup visa program.

 

Siavash Shekarian of Shekarian Law 

It’s really been informative. Thank you very much, Craig. It was my pleasure. Let’s just keep this conversation going. Let’s you know, improve on this great program and have these entrepreneurs come here and join our Canadian families sooner than later.

 

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