If you're new to Canada, it's no wonder you're interested in starting a business. It may seem that being in business is all that we talk about.
We talk about it on television, where shows like CBC's Dragons' Den let us watch entrepreneurs pitch investors for money. We talk about it in the news, which abounds with overnight success stories such as the recent $70 million sale of two year-old Halifax-based startup GoInstant to Salesforce.com. And we talk about it online, in popular startup communities found on LinkedIn, Facebook and Meetup.com.
It seems like everyone wants to join the ranks of Canada's 2.7 million self-employed people. In fact, about 40,000 newcomers start up businesses each year. But, for someone just learning about life in Canada, entrepreneurship is often fraught with challenge and risk. As a newcomer entrepreneur, do you really know what you're getting into?
In addition to the usual challenges entrepreneur face—lack of start-up funds, a jumble of regulations and the need for outside support—many newcomer entrepreneurs face double-jeopardy in the form of assimilation challenges: such as understanding the culture, languages and the way Canadians conduct business activities.
Starting a new business in a new country involves a lot to do and learn. Thankfully, Canada is rich with organizations to assist newcomers to get settled and get started on entrepreneurship or any other career path. Organizations such as Polycultural Immigrant and Community Services offer counselling support, community connections and assistance with language learning. Some organizations also offer entrepreneurship programs. Use the wise counsel of these non-profit organizations to really assess your suitability for entrepreneurship.
To be an entrepreneur in Canada you have to determine:
- Can your family live without income surety for six months?
- Are you confident in your business abilities?
- Do you feel ready to do the hard work required to start and grow a business?
- Do you know enough about Canada's business regulations, taxes and reporting requirements?
At the end of the day, to be an entrepreneur you should possess the type of personality that can tolerate uncertainty, accept responsibility for both success and failure, adapt quickly to change and persevere against all obstacles.
Of course, it's going to cost you money to get your business going. How much money you spend on your new business is up to you. You can start a business from scratch, buy a business for sale, or acquire a franchise.
Starting your own business from scratch can cost as little as $1,000 for a simple service-based operation (such as consulting or web design), or $100,000 plus for a more complicated set-up.
Buying a business in Canada is an excellent way to get into Canada. According to the Business Immigration Program, if you have prior business or relevant experience, you may be eligible to immigrate to Canada as an entrepreneur or self-employed person. Entrepreneurs need two years of business experience and a net worth of $300,000, while self-employed individuals require two years relevant experience and the intention to become self-employed in Canada.
Or, you may buy a franchise. You can purchase an inexpensive franchise in cleaning services, Internet consulting or kiosk food vending for as little as $25,000. More expensive franchises will require deeper pockets—such as the $480,000 it takes to buy a Tim Hortons franchise.
Long hours and stress
Running a business understandably requires some sacrifice.
Accept that you will need to work long hours away from your family and your community. The average self-employed person in Canada works 39.5 hours per week, while the average salaried worker performs 35 hours per week.
Some people find the stress associated with running a business to be more bothersome than the long hours. After all, it's up to you: as the owner, you're responsible for every part of the business, from sales to accounting to production to managing employees. And, making sure there's enough money in the bank to pay for all of it—insufficient cash flow is one of the reasons why half of all new businesses in Canada fail within five years.
Getting into business in Canada requires a careful assessment of your personal situation, your finances and your goals, consideration of your comfort and familiarity in doing business in Canada, and some careful planning.
Don't get me wrong: Canada is a wonderful place to live, raise a family and grow your business. Just take the time to investigate and assess your readiness to startup. Your new business will be stronger for it.
New to Canada? This is Part 1 of a seven-part series by startup expert Roger Pierce. He shares his tips to help make your venture a true Canadian success story.
Read Roger's other columns on starting a business.
Roger Pierce is the founder of NewcomerStartup.com, co-author of the book Thriving Solo: How to Grow a Successful Business and one of Canada's top experts on starting up. Roger helps others get into business by sharing what he's learned from launching 12 companies.