As an immigration attorney who often represents big Seattle-area corporations, Lola Zakharova is used to getting inquiries from people who want to immigrate to the United States. So when a former client of hers, living in the U.S. legally, reached out asking for information about moving to Canada, she was floored.
“I’ve been in this business a long time and I’ve never seen anything like this,” she said. “It was just crazy.”
The client was spooked by Trump’s now-infamous executive order on immigration, which is languishing in legal limbo after it was twice defeated by federal courts. Trump is expected to sign a revised order this week. But with the prospect of a further immigration crackdown on highly skilled tech workers, Canada’s burgeoning technology industry — especially the nearby hub of Vancouver, B.C. — is well-positioned to benefit if talent flows north.
“There’s no question that the uncertainty caused by the recent developments in the U.S. has led to a significant spike in interest for both entrepreneurs and tech executives to consider Vancouver as well as other tech centers across Canada,” said Bill Tam, President and CEO of the B.C. Tech Association. “Canada has established long-standing immigration policies that are designed to attract the best of global talent. This sets up Vancouver as an exceptionally attractive destination for more entrepreneurs to consider.”
Immigration professionals are closely watching the Trump administration’s next moves.
“That’s going to be really the determinant,” said Canadian Consul General James Hill, in an interview with GeekWire. “What direction the Trump administration takes, in terms of immigration and the ability to attract talent and give visas to people that are going enhance economic growth through the efforts of major corporations. If things are restrictive, obviously, Canada and other centers around the world are going to see the consequence of that and probably benefit from it.”
The travel ban isn’t the only reason American businesses are considering Canada. Following the first executive order, Bloomberg News obtained a leaked draft of further action that promises to overhaul the H-1B visa program, which allows skilled immigrants to work in the U.S. An overly restrictive work visa program in the U.S. makes Canada’s newly-introduced Global Skills Visa — which allows companies to bring in skilled international talent in as little as two weeks — look very attractive.
“If that executive order does get signed, it presents a big challenge to the employers,” said Zakharova. “We’ll be having a problem with talent, with some of the best folks that were educated in the United States, that got experience in the United States, that got the training — invaluable training — with employers, they may be looking at maybe moving to Europe or maybe moving to Canada and that would be a huge problem for our area and our country in general.”
Could America’s problem be Canada’s opportunity? It sure could, says Michael Tippett, a Vancouver-based businessman who founded an organization that helps U.S. companies access resources to set up shop north of the border.
“This could have some positive benefit to the region and to the country, generally speaking, as those anxieties play out with American individuals and firms and they start to look at ways that they can mitigate against the risk of this uncertain climate,” he said. “There’s mixed emotions in terms of being concerned about what the future holds but also feeling like this might be, oddly, an opportunity for Vancouver to benefit from the situation.”
Tippett’s organization, True North, offers airfare, accommodations, and meetings with immigration professionals for $6,000. He says in the weeks since Trump first issued the immigration order, he’s had hundreds of inquiries from individuals interested in Canada.
“For them, it’s really a question of getting out in front of it and making sure that they have a backup plan, in the same way that they’d have a backup plan for loss of data or redundancies, issues around infrastructure,” said Tippett. “They’re feeling like they need to put the same sorts of policies in place around personnel so that if something happens … they’ll have something in place that they can very quickly put in action that will allow their business to continue uninterrupted.”
Vancouver’s tech scene, in particular, stands to gain from a volatile immigration climate in the U.S. — an idea circulating around the B.C. press.
The city is a mere three-hour-drive from Seattle and just over two hours by air from San Francisco; Microsoft, Amazon, Facebook, and Twitter already have satellite offices there; and it’s the birthplace of billion-dollar companies like HootSuite and Slack — the latter moved its HQ to San Francisco but still has a big presence in B.C. It also offers many of the West Coast lifestyle benefits that attract members of the tech world.
“I think [the immigration order] can be a major boost for Vancouver,” said Boris Wertz, a Vancouver-based investor who founded venture capital firm Version One and sits on the board of Andreessen Horowitz. “Many Silicon Valley/Seattle-based companies already have engineering centers here … and will simply try to increase the size of their workforce here. I also think that additional companies will start engineering offices here — both from smaller startups to the large Internet [companies]. I definitely have been getting a few inquiries, over the past few weeks, from companies that are looking into Vancouver as a place to build a workforce, hiring both domestic employees as well as trying to bring in engineers from other countries.”
Canada, for its part, welcomes the global tech community. The government offers tax incentives to encourage research and development, provides funding and support for technological development, and has a specific immigration avenue for international investors.
“Canada is coming of age when it comes to the technology community and the great technology companies we’re building,” said Michael Katchen, CEO of Toronto-based robo-investing startup Wealthsimple. “We have some of the most celebrated software engineering, computer science and engineering programs in the world and, as a result, we think Canada is a wonderful place to do business and to build great teams. So, to the extent we can actually share how great Canada is for everybody to come and do work here, we think that’s a very positive message to share.”
Beyond established tech companies, foreign entrepreneurs may look to Canada, as an alternative to the U.S., when considering where to build startups.
Without an employer to sponsor an H-1B visa, it can be difficult for startup founders to find a legal avenue to move to the U.S. The Obama administration sought to create an option, called the International Entrepreneur Rule, that would allow foreign nationals to start and build companies in the U.S., if they met certain benchmarks for success. Trump’s leaked executive order pledges to eliminate that rule, leaving few options for foreign startup founders.
Previously: Trump’s immigration crackdown may force Amazon and Microsoft to shift some workers to Canada
Our neighbor to the north, on the other hand, embraces entrepreneurs with open arms. The country’s immigration office has a dedicated startup visa to encourage people to start companies there.
“Canada wants entrepreneurs,” the startup visa website says in no uncertain terms. “Unlike programs in other countries, we do not provide ‘temporary’ or ‘conditional’ status. Successful applicants to this program will be able to immigrate to Canada as permanent residents with no conditions attached to the success of their business.”
Canada is bullish about foreign entrepreneurs because of their proven track record for job and wealth creation. In the U.S., immigrants started 33 percent of venture-backed companies that became publicly traded between 2006 and 2012, according to a study commissioned by the National Venture Capital Association. Facebook, LinkedIn, Zipcar, and Tesla are among the companies in that group. As of 2013, VC-backed, publicly traded companies that were founded by immigrants had a total market capitalization of $900 billion, according to the study. More than half of the America’s “unicorns,” a nickname for startups with valuations of $1 billion or more, were founded by immigrants, according to the National Foundation for American Policy.
“The basis of our economic development is continual renewal and attraction of immigrant talent to Canada and our prime minister has stated that, effectively, our future success is driven by attracting talented people from around the world,” said Consul General Hill. “That is contributing to Canadian social and economic development and, in fact, that’s required for Canada to continue to have a robust economy and contribute to our long-term economic growth.”
The public and private sectors are publicly encouraging foreign technologists to make Canada their home. Prime Minister Justin Trudeau tweeted a message of welcoming to refugees shortly after Trump issued his executive order.
To those fleeing persecution, terror & war, Canadians will welcome you, regardless of your faith. Diversity is our strength #WelcomeToCanada
— Justin Trudeau (@JustinTrudeau) January 28, 2017
Over a thousand members of the Canadian tech community signed an open letter echoing Trudeau’s sentiments and asking the federal government to issue an “immediate and targeted visa” for people displaced by the U.S. Executive Order.
“Canada accepts immigrants with open arms, and we are already seeing business leaders work to create more opportunities, making it easier for the U.S. tech community to come up north,” said Todd Humphrey co-founder of Toronto-based health-tech startup League., who maintains dual citizenship and lived in Seattle for several years. “My company, League, is Toronto-based, and we are fielding more inquiries from U.S.-based employees, and have joined forces with other Canadian companies to show our disdain for the administration’s stance on immigration, urging the Canadian government to accelerate even more openness to foreign workers.”
A Trump-inspired Canadian tech boom may sound unrealistic or speculative — Americans threaten to move to Canada every election year — but it wouldn’t be the first time Vancouver flourished as a result of political turmoil abroad.
In the late 1980s, Canada announced its Immigrant Investor Program amid growing political uncertainty in China. After Britain announced it would hand over Hong Kong to the communist mainland and the Tiananmen Square massacre in Beijing shocked the nation, middle and upper-class Chinese immigrants flocked to Vancouver to protect their families and financial assets. The influx of educated professionals was an economic boon for the city though it did drive housing prices up. Last summer, B.C. imposed a 15 percent tax on foreign property buyers intended to cool the hot housing market but the government is now considering rebates for that tax in response to Trump’s immigration policy, The Vancouver Sun reports.
“I think you could see a similar exodus, where you’ve got world-class experts from across the world coming in, through the states, back up to Canada and setting up shop here,” said Tippett. “I think when that happens, it’s not only going to be a flight of talent but you’ll see a flight of capital. VCs and other investors will follow the talent and potentially bring money up here as well.”