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Each episode on the investment Immigration Podcast by Uglobal.com, host Salman Siddiqui sits down with leading professionals, attorneys, thought leaders and government officials to discuss the latest developments impacting citizenship and residency by investment. Whether you´re someone who takes part in cross border transactions, works in the investment immigration community or are personally interested in participating in citizenship or residency investment, tune each week to the Investment Immigration podcast to stay up to date on what´s happening in the investment immigration world.

About the host

Salman Siddiqui is the host of Uglobal’s Investment Immigration Podcast series. Siddiqui is a versatile storyteller and embodies the spirit of a true global citizen. His own immigration journey took him to many places around the world, including the UK, Cyprus, Turkey, and Qatar. He has written dozens of in-depth articles and features on global investment immigration programs for the Uglobal Immigration Magazine and website. He is a journalist and creative content editor by training. He earned his master’s in arts degree from SOAS, University of London. He is currently based in Berlin, Germany.

Salman Siddiqui

Episode Transcript

David: The Government of Canada is sending a very positive message to the world

about the role of immigration in our country that people who are prepared to contribute,

most importantly into this economy are welcome. They have to fit through the criteria, of

course. They've got to be committed to what they're going to do. But essentially,

Canada is open and the increase in the immigration program indicates that.


Salman: Welcome to the investment immigration podcast by Uglobal.com with weekly

in-depth interviews with the world's leading investment immigration professionals. Hi,

everyone. This is the Investment Immigration podcast, and I'm your host, Salman

Siddiqui. This week we are going to talk about Canada and how investors and

entrepreneurs can make the most out of the residency options there. Apart from the

startup visa, we will learn about how to buy a profitable business in one's desired

industry in Canada and what kind of pitfalls to avoid when doing that. We'll also touch

on how to find experienced local partners and what kind of business ideas work best

when the aim is to get permanent residencies for yourself and your family. To help us

unpack all of this. This week, our guest is David Crawford, who is a partner at Fragomen

Worldwide. He's a lawyer responsible for Fragomen in Canada, and he has also worked

in Sydney and London. He was previously a diplomat with postings in Islamabad and

Pretoria, and prior to that, he worked as an academic. Welcome to the show, David.


David: Thank you, Salman.


Salman: So please enlighten us. Which residency options work best for investors and

entrepreneurs in Canada?


David: The way it operates now, typically individuals would enter as temporary

residents, and that will allow a period of time living in Canada while they set up their

business in country. Recognizing that at the moment there are no passive investment

programs that are running and then with a view to converting to permanent resident

status as quickly as practicable. In the case of the startup visa, that can happen more

quickly. But even with the entrepreneurs, we're talking with officials about facilitating a

change over to permanent residence once they've got their business running. I think

very importantly, part of this Salman is for individuals to understand that as intimidating

as it may be to come into a new country and into a new business environment, it's best

that they do so supported by professionals and individuals who are there to help them to

succeed. And so while we focus on the immigration work, there are councils, there are

towns, there are professionals and organizations that play an active part in making

people succeed in what they want to do in their life.


Salman: Right. And we're going to talk about that later in the show about where they

can seek help to know about the options. But first, I want to know about the kind of

advice you give to investors who want to put their money into a business in Canada. Are

there particular kinds of businesses that work best? And the main consideration of an

investor or entrepreneur is not just the long term profitability of the acquired business,

but also permanent residencies for themselves and their families. So what advice do

you give to them?


David: It's a very good question. The starting point would typically be what are they

done in their business in the past? So that if you've been selling furniture, you probably

don't want to sell rocket fuel. It's just not going to work so well. And in any event, an

official would wonder, how practical would it be for you to change direction in your own

career trajectory. So looking at what people have done in the past and you intimated

and it's a good intimation, that individuals will typically buy into an existing business,

although that's not always the case. But if it's a possibility, they're open to, we can

introduce them to parties who will open up a window of opportunities when it comes to

the types of businesses that are available within Canada. That would be consistent with

what they've done in the past. And that way it minimizes the level of risk. There are

some people, on the other hand, particularly in the IT sector, where obviously who've

got very got a very clear idea of what they want to do and they don't require so much

help and they're happy to start up a business cold. But I think that for the most part,

entering and creating a brand new business from the start is a little riskier for those not

used to it because there are so many other factors that we're at play. So it very much

depends upon the circumstances and what the people want to do. And our view is that

the business plan is not just a device to worry about an immigration qualification

process. It's actually a real business plan that they can look to their economic future to

establish themselves and their family successfully.


Salman: Right. And if somebody wants to buy a profitable business in one's desired

industry in Canada, how does one even start to look for something like that?


David: We have business partners who are actively involved in that. We have

absolutely no commercial interest in how that operates. But it does mean that the

individuals get an opportunity to see businesses that are available across sectors,

across jurisdictions. So across provinces, they don't have to think solely in terms of B.C.

or Ontario or Quebec. There are other places and to see what fits with their not only the

commercial desires, but also the sort of lifestyle that they want to establish. Bear in

mind that. I think I reference the demographic challenges in Canada. That's equally true

for existing business owners looking to get out. And so there are opportunities that are

important not only for the vendors but also for communities so that they've got

successful businesses continuing into the future. After all, immigration isn't just about for

the individuals. It's not just about what the governments want. It's for local communities

as well.


Salman: Right. And sticking with this question of acquiring an established business.

Now, I've read in some articles where people have been struggling to find the right kind

of business. And as you already mentioned, it depends on the person's interest and

what kind of businesses they are looking for. But in most of the cases, some people

don't have the budget to buy a profitable business. So would you advise an immigrant

investor to buy a struggling business and commit to its improvement? Does that usually

work?


David: No, I wouldn't encourage a person to do that. I'd encourage anybody in their life

to do something that is reasonable and sensible. If something is either too good to be

true or if it sounds better than it has a right to be, probably is not right. It's got to fit in all

respects. And I can understand that all of us want to sell the house for more than it

might be worth in the local market, but we shouldn't expect that we paid more. And the

same is true for a business person trying to sell their business. As for the transition into

the business community, and I know you didn't ask this question, but it goes with the

sale that very often vendors will remain working with the new owner in the business for

a period of time as they adjust to the new business environment and they get used to

how things are done. That's not really a problem. I think that if it's handled in a sensible

way, it's good for the vendor of the business as well. One more thing, because I think

it's worth mentioning people who are selling their business want to do so confidentially.

It's not going to do anything for the value of a business to advertise that it's for sale. So

all of these things happen in a very discreet environment, which is good for the

intending immigrant in addition to the vendor.


Salman: Right. Now, let's talk a little bit about the startup visa program. First of all, if

you could tell our listeners what is that program and if you could also touch upon the

different investment thresholds that exist for angel investors, VC funds and business

incubators which differ under the program.


David: The startup visa was commenced, I believe, in 2013. You can check me up

these years past so quickly and initially I believe it had primarily a focus on IT related

businesses, although that is no longer the case, and it's a program that initially offers a

work permit so that people can enter Canada fairly quickly to execute their idea with a

view to converting to permanent residence status pretty smartly after arrival. The role of

those bodies that you mentioned, like the angel investors, the joint ventures and the

incubators is to act as firstly a way of assessing the utility of the business concept to

see if it will operate successfully in the Canadian market and its objectives to create

export related opportunities primarily and employment opportunities for local permanent

residents, be they citizens or permanent residents. And the amounts of money initially

were fairly modest, with the angel investors about 75,000. But in reality the practice has

been that if an individual has got more than 500,000 CAD, they're on the roadway to try

and make this successful. But I think more than worrying about the financials, those

assessing authorities have to believe that the business concept makes sense, that with

the available skill sets and the funds, the concept, the business concept they have will

operate within the Canadian labor market and allow the business to succeed as it

should.


David: So in this sense, these bodies, the case of incubators, which we more

commonly work with their role is to make an assessment of the viability of the business,

to understand the role of the main applicants, to see what they would do in the

business, and to put a recommendation to the Government of Canada through IRCC

that they are supporting the application and subject to any questions that officials might

have. That application will be approved and the people can commence their lives in

Canada. As I say, there'll be an initial approval so that they can enter the country and

work temporarily and very soon move towards permanent resident status. That program

is not a huge program. It will count in the hundreds, not the thousands, through the

course of the year. It means it has to go through that tough screening process to make it

work. And it's very much a case where in looking at each matter, we will take into

account the detail of the circumstances unique to that case and talk to the incubators

with whom we talk to to see if they're interested in playing a role.


Salman: So you must have seen a lot of applications from immigrants who will come up

with their own business ideas. I'm interested to know what kind of mistakes do you

commonly see in their business plans that people should avoid and where do they

usually go wrong?


David: Because there are many mistakes when making business, including me, by the

way. The first point I'd make is lack of familiarity with the Canadian market, or lack of

any market means that any planning is misguided. People make false judgments and to

the extent possible, we always encourage people to visit the country. And indeed that's

part of the start up program. There's an expectation that the individuals involved will visit

Canada and that part of Canada in which they plan to operate, meet with relevant

people, inform their thinking about what they want to achieve. And the role of the

incubator is to help guide the individual to the extent practicable. Also, in the business

planning, there's a danger that people are far too optimistic about how long it will take to

ramp up their top line sales, how optimistic they are to realize bottomless profitability.


Salman: You mentioned something there that the market research is usually not on

point, but how can one do the market research? Like you mentioned, you have to visit

the country. So are you advising that they should perhaps come first there as a tourist to

explore the areas, to meet people? What should be the steps for them.


David: In a situation like this? We would typically line up individuals who we believe

could offer them guidance. There are candidates well placed. It's got authorities,

municipalities, individuals who will go out of their way to meet people, to offer them

support and guidance. This is an environment, in my view, that is remarkable in the

ability to help individuals focus on what they want to achieve in their business

community. Because after all, there are several that we work with. The municipalities

have a stake in all of this. This is about the growth of their region, if you like, their towns.

So it's an introduction to those sorts of people to help the individuals make judgments.

They're going to be best for themselves and their business and their families.


Salman: It is something they can't do over the phone, right. They have to come to the

country.


David: I think there's a reason why we all went not through the pandemic, that we

couldn't see each other in person. And in my own experience, I'm involved in

committees of one sort or another. It makes an awful lot of difference if you can see

people in person and if you're involved in an industry where you have to produce goods,

for example, and you want to know where they're coming from or where they're going

to. Seeing those places is very important in getting a real understanding of what it would

look like. And by the way, this it's not just about the business. The business is, do I think

I can live here happily? I think my family can live you happily. I was once told before I

went on a posting that 60% of the success of my post is dependent upon the happiness

of my family. So I think that sort of thinking. Applies equally to business people planning

to live in Canada.


Salman: That's a very important point. So how can foreign entrepreneurs seek help

from established business consultants and immigration lawyers like yourself in Canada?

Is there a government sanctioned list or a directory that is available that one can look

up?


David: Great question. Yes, I think that if they contacted some of the incubators or the

provincial governments who are involved in these efforts, they'll be pointed in the right

direction. We also have our own connections through the private sector and the public

sector to help people out. We don't in any way think that we can be the source of all

information, nor do we want to be. We want to be facilitators of successful migration. I

want to make it very clear that we play a role, but we're only one of a number of people

playing a role in making these programs work. It's no good for anybody to try and

deceive. Somebody qualifies for a visa, and even if they qualify and assume that if they

qualify, all will be right. The success of these programs depend upon individuals gaining

success for themselves and their families in this country. And as they succeed, to send

word back to their friends and relatives in their own country that it can really work, that

it's a good decision to make. So investing themselves and their futures in Canada is

something we want them to feel very happy about.


Salman: Right. Fair point. Now, David, if an investor wants to find an experienced local

partner in Canada who could co-invest with them, what kind of advice do you give to

such people, to such investors? What should they be careful about? Because I've read

a lot of things online where things went wrong for a lot of people because they didn't find

the right partner.


David: I think that's a very good question. Salman I've come across situations myself

where people have placed a great deal of trust on individuals in the new country, and

that trust has been misplaced, or at least has been betrayed by the individuals. There is

no doubt that and I would be very nervous to in this situation. It's right to place trust in

an individual, but you have to be confident. You have to do. On the calibre of the

professional or the person with whom you are dealing and however that might be made

by. Government agencies or any other mechanisms that, for example, through

professional organizations to understand the standing of advise and the time is

appropriate. There is a reason why professional organizations are overseen by relevant

bodies now, that is, to maintain the integrity of the professional body, including the

individuals that could provide advice to these individuals. The other point I would make

that as time goes by and these programs succeed in individuals involved in these

programs have proven to the public that they are trustworthy and be provided upon to

provide not just positive but honest advice, because sometimes the advice has to be "it

may not work", that "you may not be suited". There's nothing wrong to finding that

somebody says, I don't think you're right for this program or that program. If the advice

is good, it's good advice. I hope that dimension makes sense as well.


Salman: Yeah, it does make a lot of sense. And like you said, I mean, it's a high risk

thing to start a business in a new country with an unfamiliar environment. And if you end

up taking the wrong sort of advice, then you will land in trouble. So thanks for pointing

that if there is someone who is very risk averse and wants to invest in a really low risk

business such as a medical clinic or a bakery with real estate, do you think such

business ideas are good in terms of gaining permanent residencies and eventually

citizenship in Canada?


David: It's a very good question, and I can understand somebody being risk averse and

trying to look at something safe. On the other hand, particularly in the provincial

programs around the country, there is a disinclination to support applicants going into a

businesses that notionally could be provided very easily locally. There's no simple

answer to your question, but I think the government would look at the background of the

individual to see if they are of a reasonably high caliber as an entrepreneur. And then

there's a question about saying, well, why would they go and do, let's say, a bakery or a

milk bar or something like that, that you might be reference when that doesn't match

with their background? I think that where provinces have a choice on the candidates

that they're select, their choice will relate to the choice of business activity, the amount

of money they're prepared to invest, the sort of candidate you're talking about not may

not be attractive to the provincial government. They may not be selected when it comes

to the advisory stage in identifying the right sort of business for the individual, the

amount of money to be invested, the relative risk, the applicant should be getting, or the

intending applicant should be getting the advice on whether or not what they have in

mind is feasible in terms of qualifying.


Salman: Right. And let's talk a little bit about what kind of ideal candidate Canada is

looking for in terms of entrepreneurs and the high calibre candidates that you

mentioned. What is that? What is the ideal high calibre candidate that Canada really

wants? Is it just there's a perception that it's only the I.T. background fellows with their

backgrounds in artificial intelligence and forming these companies? Is that the only ideal

candidate?


David: I think not. I think that was the concept in 2013/14, when the program was

running, there was somebody in a garage with an IT who was with a computer, who was

developing the next big thing idea, and they were the future of the country. There is no

doubt that that sort of start up business in the IT ecosystem is very popular and it's likely

to be an important part of what goes on. There may equally be people who want to

invest in a regional winery, for example, or who would want to play a role in a lumber

business in regional Ontario, who would be very important for that part of the province.

So while it's impossible to generalize about the industry or the size of the business, if an

individual's got a background in providing a certain sort of service or producing sorts of

goods and meet with the objectives of the area and the province, which after all, will

very often relate to employment of local people, the more obvious the benefits, the more

obvious the reason why the government would likely to support the application. When

it's all said and done, immigration is a common sense kind of thing. We have rules for

every sort of category for all sorts of individuals and when they apply. But the bottom

line is that pretty much a simple question, isn't it? Is this a good thing for Canada and

this is a good thing for the individual and their family? And if the answer to those both

those questions are good, then there's a starting point.


Salman: Yeah, and that's a very important point because what might be good for, say,

an individual, in their perception that this is good for my immigration option might not be

the best option that Canada itself might be looking for. So thanks for sharing that and

clarifying that point. And also want to talk about the advantages and disadvantages of

acquiring a franchise. Wouldn't you say it's a much safer investment since the market

would already know the say a brand? And just stop, I mean, acquire a franchise and just

grow with that.


David: I can understand the thinking. In a cautious situation, an individual would

probably feel a little more comfortable going down that track. And in the past, officials

and governments have been cautious about that because they think, well, we're not

benefiting from much entrepreneurial skill. Typically on franchisees compliant, they don't

exercise so much discretion. And is this really where we're heading towards in our

program? Is this a thing that's supposed to be benefiting the country? I'm not saying no.

I'm just saying that I would think that in any discussion about what's going to be right for

an individual recognizing their prior business history, is that the right sort of thing to do?

And by the way, for a business person who may have succeeded in their own country,

there may be other ways to make this work. It may not be the start up visa. It may not

be the provincial program. There may be another business related opportunity that

could be deployed, that may be more straightforward for an individual in those

situations. So I don't want you to think that there are only a couple of options and

otherwise the person may not work. As a matter of fact, I think that for good or bad, the

Canadian immigration system is a little complicated and it would be a good thing if

people thinking about immigration get good advice about what in the context of

everything going on would be best suited to meet their needs. Now, of course, for

business people to start up visa, the provincial programs may be right, but they'd be

wise to get good advice to check on any other possibilities.


Salman: So what are the possibilities you have in mind?


David: Well, what I was thinking about is that there might be a very successful business

in another country and they might decide to enter a set up a related entity in Canada

because there is an ability to provide goods or services through that existing entity into

a Canadian business which would benefit both businesses and then create other

opportunities, including potentially immigration or opportunities. It was just something

that is looked at when we think about the possibilities for individuals.


Salman: And do you see that happening more often now? Do these kind of ideas come

in?


David: Yeah, it's certainly an option available for some people, without a doubt.


Salman: Let's talk about some of the trends actually, like the few trends that you're

seeing in the immigration program. Like, for example, from what countries do applicants

to the startup program are coming usually from or anything that you want to share with

us?


David: It is a good question because if you stand back at the present time, if you think

about it and tell me if you disagree. By the way, the Government of Canada is sending a

very positive message to the world about the role of immigration in our country, that

people who are prepared to contribute, most importantly into this economy are

welcome. They have to fit through the criteria. Of course, they've got to be committed to

what they're going to do. But essentially, Canada is open and the increase in the

immigration program indicates that.


Salman: Yeah, everybody would agree with that. I mean, for the past few years, yeah,

that's been the trend.


David: That's exactly right. And around about 95% of the growth of the labor market

depends on immigration. So I think that the argument is certainly wouldn't be

complacent, but I think the argument itself self-evidently strong. In addition to that, we've

got a regulatory system that, broadly speaking, is supportive. It's trying to facilitate and

deliver on the government's policies. It's complicated at the moment because there is a

large pandemic related backlog complicated by Ukraine and Afghanistan, but

nonetheless the system is positive. Compare that with lots of other places around the

world with it. Unfortunately, there's been economic challenge, there's been conflict,

there have been geopolitical forces at play, and the world is a little scarier place at the

present time. And in my view, Canada represents a beacon, a light on the hill, if you

like. So I think that there's an opportunity that is worthwhile exploring for those people

looking for a solution. So going back to your question, I have seen an increasing source

of intending immigrants in including people from the United States. But the truth remains

that there are people in many countries around the world who are looking for a solution.

And in my experience in this business over many years, very often people are not

emigrating on the basis of their own individual needs. True is that might be it's really for

their family.


Salman: Even from the US you're seeing the same trend.


David: Yeah, an element of that. That's true. But there are many other countries where

we're seeing inquiries coming from Salman and I see that likely to remain the case.


Salman: So you mentioned about people coming in from the US. I've heard this from

other countries as well. I was speaking to somebody from Malta, from Portugal, that a

lot of American investors and American families, wealthy families are moving to Europe.

And mostly it's because I mean, one person shared with me was the political

environment there. A new lifestyle. They want and they want to see a more secure

future for themselves in Europe. So the Americans who are coming to Canada, do they

have similar kind of motivations?


David: There's always been a soft spot for Canada and the people we're seeing. And

Canadians are self-effacing. I don't know that they always recognize that in their country

or in themselves. But the country has a lot of attractions, and at the present time there

are some US nationals are thinking it might be a good opportunity to try the life here,

recognizing that crossing a border and living somewhere a few years doesn't guarantee

we keep people, but we're certainly attractive.


Salman: And you also mentioned something about the backlog of applications. The

ministers are saying that there's been a huge improvement in the backlog and

applications are now being processed much faster post-pandemic. But I still hear a lot of

complaints from a lot of people about the backlog. I mean, I know personally of many

people who have been waiting for a good amount of time for years now and the

applications haven't been heard. What's your view? What are you hearing from your

clients? And is it true that if you're applying for a program like the start of Visa, the

processing time is much quicker?


David: With startup Visa, yes, it is faster. Having said that, I think the important part of

the start up visa is the preparatory work more than in some other categories lining up

the business, getting the business plan, identifying the right sort of business to go into.

Feeling comfortable having a visit. So the investment in time and effort involved is

different in nature, say from somebody applying in through express entry. As a teacher

who's worked in Canada for three years, it's a very different time where the preparatory

work is not there. It's self evident. I've been here, I've worked and I should be okay.

Having said that, there is still a considerable delays across all elements of the program

and it is true the government is employed, I believe, in the order of 1200 people, all of

whom need to be trained and the systems need to be supported properly by

government. There has been an increasing movement to online applications to facilitate

speedier processing. All of that will continue need to improve over the next little while.

So it's not as ideal as we would like, but I do believe it's going to get better. It has to get

better because if the government's going to reach its immigration targets, it simply has

to improve. And I think that there is a genuine effort to make it work.


Salman: And I'll give you the last word, David, on that point. If somebody is listening to

our show, what would you advise them in terms of given the background that they are

still processing delays and some people might be discouraged from applying at this

point or maybe thinking about other programs? What would you say to them that why

they should immediately apply for Canada's immigration program?


David: It's a good question, and each answer is going to be dependent upon the

individual's preferences. But I would say that Canada retains its mantel, in my personal

view, as a desirable destination in all respects, in business in the future, in the social

environment and the infrastructure, and that people can grow in a place like Toronto,

which, after all, has a population of which more than 50% was born outside the country.

We're being a foreigner is not a bad thing that there is. There is an opportunity for all. I

genuinely believe that for those who are in business and have that sort of background, if

you're in business in any country and you're planning to open a business in that country

or elsewhere, there is nothing to replace due diligence that a good business person will

do all of that. That applies equally in Canada so that the preparatory work I was

referencing earlier is crucial. And just as you would do due diligence in another country,

getting sound advice of whatever sort is crucial to making a sound decision, because

ultimately good decision making has consequences for the individual themselves and

members of their family. And if they get it right, they create a different narrative for

themselves, for the future, and I think a very positive one. Certainly that's been my

experience, but I can only offer that in the hope that people think about their best

interests and make good decisions based on sound advice.


Salman: Thank you so much for your time. David was wonderful talking to you and we

learned a lot about the opportunities in Canada for investors and entrepreneurs. Thank

you again for your time and a shout out to our listeners. Please stay tuned. We'll be

coming with more episodes like these with more programs on more countries. So keep

listening to our show. Thank you so much.


David: Thank you. Salman You've been great.


Salman: You've been listening to the investment immigration podcast by Uglobal.com.

Join us again soon for more in-depth conversations exploring investment immigration

opportunities from around the world.

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