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Immigrant tech stars face hurdles in quest to start business in Canada Add to ...

Romanian computer-science stars Mircea Pasoi and Cristian Strat turned down jobs at Facebook and Google to build a technology startup in Vancouver.

They’re the kind of talented migrants that most countries fall over themselves trying to attract. Their big idea, an algorithm that summarizes the most important news stories in a person’s social network, could be worth millions if properly executed. They already have serious venture-capital backing in Canada and the United States.

But what the Romanian entrepreneurs don’t have is a clearly defined path to permanent residency in Canada.

Their case highlights one of the enduring tensions of the immigration system: the kind of people Canada wants to embrace can face frustrating obstacles that persuade them to look elsewhere.

In this case, under the rules that govern entrepreneur-class immigration, applicants need $300,000 in net worth. Mr. Pasoi, just 23 years old, does not have that kind of money.

Citizenship and Immigration Minister Jason Kenney said the entrepreneur-class category has grown so ineffective that he suspended the program last week and is going back to the drawing board. He said the program is small in the overall immigration picture, but he’s open to new ideas for retooling it.

Wait times for entrepreneur-class immigration applications had grown as long as eight years in some cases. Over the past decade, the number of successful applicants plummeted by 78 per cent, to 372 in 2009. There are also entrepreneur streams in eight provincial nominee programs, but they differ in every province and none in British Columbia appears to suit the Romanian entrepreneurs.

Although the entrepreneur stream occupies a relatively small niche, it could hold enormous potential in the technology field. Today’s most valuable companies often begin with one or two very bright people and quickly scale up to become massive employers.

The hunt for that kind of transformational talent is pushing national governments to streamline immigration for promising applicants, particularly in the fast-moving tech world. Canada, meanwhile, has struggled for years to cut immigration wait times. At the moment, the system is gummed up by more than a million backlogged files, Mr. Kenney said. The dilemma is how to balance fairness, security and the national interest while remaining an attractive, attainable destination.

Eric Brooke is a spokesman for Startup Visa Canada, a Vancouver-based group that was inspired in part by the cause of the Romanian entrepreneurs. They’re calling for changes that would lower the financial threshold for entrepreneur applicants from $300,000, to raising $150,000 from Canadian investors. If, after two years, the business fails or if it hasn’t created three full-time jobs, the immigrants’ visas would expire and they would have to leave Canada, according to their proposal.

“The intent should be to create new jobs,” Mr. Brooke said. “The concern is to ensure we have the skills we need in Canada to create the new companies that are going to wow us.”

Mr. Kenney said he’s open to the idea.

“I’m keen on redesigning our entrepreneur program and our investor immigrant program so that we yield more economic benefit. If there’s a feasible way of tying that to the number of jobs created, I’d be willing to look at that,” Mr. Kenney said.

He said he would be concerned, however, that verifying job-creation claims might create additional bureaucracy.

The entrepreneur program will be suspended for the next several months. Applications received before July 1 will still be processed, so the delay will serve to cut the backlog while also allowing time for a policy redesign. The process is still preliminary so what form it will take is not yet clear, Mr. Kenney said.

“We’re not going to be hurt at all by putting a temporary freeze on the relatively small entrepreneur program,” Mr. Kenney said. “We don’t have a shortage of qualified economic immigrants who are going to contribute to our economy. Our bigger challenge is managing these huge backlogs we inherited.”

Britain has already eased its investment requirements as part of a startup initiative from £200,000 ($306,000) to £50,000. In the United States, former presidential candidate John Kerry has co-sponsored the Startup Visa Act in the Senate, which is very similar to what the Canadian startup group proposes, and New York Mayor Michael Bloomberg has spoken several times in favour of such an initiative.

“We will not remain a global superpower if we continue to close our doors to people who want to come here to work hard, start businesses and pursue the American dream,” Mr. Bloomberg said in June. “Today, we may have turned away the next Albert Einstein or Sergey Brin.”

The son of an engineer, Mr. Pasoi grew up in the small Romanian city of Ploiesti. From his earliest days, he was bored by computer games and preoccupied with learning the computer’s inner workings. He won several prestigious programming competitions and, eventually, internships at Google and Microsoft. His friend, Mr. Strat, was wanted by Google, but chose to pursue a startup.

It’s a high-risk, high-reward path. For every Sergey Brin, co-founder of Google, there are a few thousand unknown failures. Mr. Pasoi and Mr. Strat are being assisted by Vancouver’s Bootup Labs, which describes itself as a “startup accelerator.”

“We’ve tried explaining to Immigration that we’re not here to steal jobs. If we wanted, we could work for established companies. But our dream is to build a startup,” Mr. Pasoi said. “We’re trying to make a company and hire people in Canada but it’s difficult.”

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