IRCC now solely manages the Start-up Visa Program, replacing NACO and CVCA.

Canada’s Start-up Visa (SUV) program is undergoing significant changes as Immigration, Refugees and Citizenship Canada (IRCC) takes full control of its management. This shift comes amid ongoing issues with the program, prompting the federal department to review its operations and make adjustments.

Previously, the National Angel Capital Organization (NACO) and the Canadian Venture Capital and Private Equity Association (CVCA) were responsible for overseeing the SUV program. They managed the three main components of the program: venture capital firms, angel investor groups, and business incubators. Their role included vetting these organizations and ensuring they met the program’s standards. However, both NACO and CVCA confirmed that they stopped this vetting process earlier this year.

The Start-up Visa program aims to fast-track the entry of foreign entrepreneurs and their businesses into Canada. To apply, candidates needed a letter of support from one of the designated organizations approved by NACO or CVCA. Claudio Rojas, CEO of NACO, revealed that both NACO and CVCA were compensated by the government for their roles in the program, with their contracts totalling $1.075 million since they began in 2018.

IRCC recently imposed a moratorium on adding new designated organizations as of April 30. However, organizations that were already designated continued to process SUV applications. By July 31, IRCC decided not to renew its contracts with NACO and CVCA. This decision reflects the department’s efforts to address challenges within the program and focus on reducing the backlog of applications, which numbered under 17,000 by the end of July.

IRCC has stated that it will operate the SUV program directly for the time being to review its needs and assess the program’s structure. If it determines that new contracts are necessary, it will post a tender for them on CanadaBuys. Additionally, at least eight organizations previously involved in the program are no longer listed as designated organizations. These organizations requested to be removed from the program, confirming that they are no longer participating.

The changes come alongside a new policy limiting each designated organization to handle only 10 applications per year. This hard cap aims to reduce the application backlog and represents a significant shift from the federal government’s previous plans to increase the number of applications accepted. Last year, the government had announced ambitious targets to raise the number of SUV applications to 6,000 by 2025. Despite these targets, the new cap will restrict the total number of applications to a maximum of 840 annually, based on the number of designated organizations.

The Start-up Visa program was introduced in 2014 to replace the Federal Entrepreneurship Program, which had attracted experienced business people to Canada. To qualify for the SUV, an applicant must secure support from a designated venture capital fund, angel investor group, or business incubator.

Concerns have been raised about the program's effectiveness and the potential misuse of its provisions. Critics argue that some incubators charge high fees for letters of support, which could undermine the program's goals. Despite these challenges, NACO has expressed its commitment to supporting the program's objectives and helping member organizations that meet the criteria.