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Northern Exposure

American entrepreneurs are finding success by heading for the border.

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This story appears in the August 2003 issue of Entrepreneur. Subscribe »

Once scorned as a provider of commodities, comedians and little else, Canada has become increasingly attractive for entrepreneurs. In recent years, many small U.S. companies have begun moving parts of their operations to Canada or even relocating their entire businesses there. In the entertainment industry alone, the U.S. Department of Commerce believes hundreds of small and large American companies have outsourced tens of billions of dollars of TV and movie work to Canada over the past five years.

While the United States is struggling through a prolonged period of economic stagnation, Canada has recorded the strongest economic growth of any industrialized nation over the past two years-growth that makes it easier for companies in Canada to find customers, boost profits and build a capital base. Canada has grown so robustly that its finance minister has dubbed it the "Northern Tiger," and venture capitalists in Canada are more generous than their U.S. peers. "Companies there are able to invest money back into their operations, work with VCs and raise productivity," says Christopher Sands, senior associate at the Canada Project of the Center for Strategic and International Studies, a Washington, DC, think tank.

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