Category: funding

Silicon Country: Everything You Need to Know About Canada’s New Start-Up Visa

go-canadaToday is one of those days that I’m more proud than usual to be Canadian. We may one day look back at something that happened today as truly historic because of the impact it may have on Canada, the U.S., and the technology world in general. Today, Canada launched the Start-Up Visa program.

“Canada is open for business to the world’s start-up entrepreneurs. Innovation and entrepreneurship are essential drivers of the Canadian economy. That is why we are actively recruiting foreign entrepreneurs – those who can build companies here in Canada that will create new jobs, spur economic growth and compete on a global scale – with our new start-up visa.” – Canadian Immigration Minister Jason Kenney

It’s a pilot program with an initial allotment of 2, 750 visas where the focus is on quality of applicants. Canada’s Venture Capital and Private Equity Association (CVCA) and Canadian National Angel Capital Organization (NACO) are initial partners in the program helping to vet investors, mentors, etc., overall helping Citizenship & Immigration Canada set on the goal to first establish a track record for success, and then likely broaden the number of visas over time. That’s exactly the right thing to do.

In a nutshell, the Start-Up Visa Program requires that:

1. You’re not Canadian and have a great idea or business

2. You have significant funding from a designated Canadian Angel Investor (min $75,000 investment) or Venture Capital organization (min $200,000 investment). List below.

3. You have Intermediate English or French language proficiency (Canadian Language Benchmark 5)

4. You have at least one year at a post-secondary institution

What do you get if selected?

How about something that people hope, pray, and wait for…Permanent Residence Status in one of the best places to live in the world…Canada! If you’re more familiar with the U.S. system that’s like getting a green card. We’re not talking a work visa here, we’re talking about permanent status and a fast track to citizenship. That shows some serious focus and recognition of how entrepreneurs are the bedrock of a strong economy. No, this is not an April Fool’s joke.

What should also be recognized is how material an impact this may have on the start-up ecosystem in the U.S. It’s well-known how difficult it is for tech companies to hire foreign nationals, the messy bickering about HB-1 visas and proposed reforms stuck in Congress. It’s great to see Canada acting on what is clearly a need and an opportunity. 2012 was by most accounts one of the most active years for venture capital in Canada in quite some time and co-investing has also picked up. Just think, if Canada is now to become the go-to place to start your tech dreams then it’s also a gateway to the start-up communities and investors in Silicon Valley, New York, and elsewhere south of the border. You can easily see a lot more co-vesting happening, plus partnerships, acquisitions, and generally even closer bonds than exist today. That’s a good thing for everyone, especially entrepreneurs.

According to TechVibes, the designated VCs and Angel groups selected to take part in the program include the top of the investment food chain in Canada:

  • OMERS Ventures
  • BDC Venture Capital
  • iNovia Capital
  • Rho Canada Ventures
  • Version One Ventures and others.
  • Angel One Network, Inc.
  • First Angel Network Association
  • Golden Triangle Angel Network

There’s a limited number of visas and competition will be fierce for such a grand prize. If you meet the criteria, talk to your investor and get your applications in today!

#Mint CEO Aaron Patzer: Must See Video For Start-ups!

Mint went from inception to $170 Million exit in two years. I’d say that qualifies CEO Aaron Patzer as someone that can drop some knowledge on those aspiring to follow in his footsteps. At the Juice Pitcher event hosted by TheFunded.com and Vator.tv he did just that. There is no turn-key plan for business success; building a business from idea to success is a journey and what works for one company might not work for another, but Aaron provides some very valuable guidance at a detailed level not usually shared.

Congrats to Mint on all their much deserved success! Here’s the must see video and key highlights from Vator News. Enjoy!

Raising Money:

  • Phase 1: Once you have a mature idea, raise $100,000 from friends and family to build a prototype
  • Phase 2: Prototype complete, raise $1 million and launch an alpha into the market.
  • Phase 3: Once you have some traction, raise $5 to $10 million to scale up.

Phase 1 Expenses (1st $100,000):

  • Founders: $30,000/year
  • Engineering 1st hires: $30,000-50,000/year
  • Office: $400/cube/month
  • Tech: $10,000
  • Legal: Deferred payments for 0.50 – 0.75% of company

Phase 2 Expenses (seed round):

  • Salaries: $50,000 – $90,000/year ($450,000/year for 5 people)
  • Overhead: +20% ($100,000/year)
  • Legal: $25,000 + $2,000/month ($50,000/year)

Phase 3 Expenses (Series A)

  • Salaries + Overhead: $200,000/year/person
  • COGS: many one-time expenses add up to about $150,000/month
  • Legal: $10,000-$50,000/month

New VC Fund: Canada’s Got Mobile Money!

Rick Segal posted a description of the shiny new VC Fund for everything mobile. This is great for tech innovation in general and Canada specifically. Some great companies have come from Canadian entrepreneurs but far too often they have had to move to Silicon Valley to get the support and funding needed to go big.

Not any more, this new fund isn’t simply another example of Canada’s Web 2.0 community following the lead of our U.S. counterparts, it establishes Canada in the lead for the wave of next generation mobile innovations. Yes, Kleiner Perkins has a $100M iPhone fund but this new fund constitutes the first ‘any platform’ fund (and it’s $150M so it takes the lead!).

So get those ideas out of your head and on your phone! Great job RIM, JLA, RBC, and Thompson.