IN THIS GUIDE · Separating household emergency savings from business capital
Start with the E-2 eligibility and application overview
Substantiality is measured against the enterprise
Substantiality is measured against the enterprise, not against what the family could theoretically afford. The comparison is between the amount committed and the total cost of buying or establishing this particular business, and there is no universal minimum figure. A consultancy needing office space and software sits differently from a bakery buying ovens. Start by costing the business honestly, then ask what proportion of that cost is already funded. Costing goes wrong when the purchase price is treated as the cost. Hypothetical example: a buyer of a small medical-device servicing operation prices the acquisition and omits the loaner inventory, the calibration equipment that must be recertified, and the insurance a service contract requires — three items that change the denominator materially. Cost what it takes to operate, not what it takes to sign.
Committed and at risk, not merely available
Money sitting in a personal savings account is not invested, however large the balance. Capital becomes relevant when it is irrevocably committed to the business and exposed to commercial loss — spent on equipment, paid under a signed lease, placed with a supplier, or held under arrangements that cannot simply be reversed. Escrow terms, contract conditions and refundable deposits need fact-specific review; none of them qualifies automatically. The commitment most often overstated is a transfer the buyer can still undo. Funds moved into an account the applicant controls have travelled, not committed; a deposit refundable at will is a reservation. Ask of each amount: who could return this money, on what terms, and what document says so. The answer, not the balance, is what the analysis turns on.
Non-marginality is about the business, not the reserve
Non-marginality asks whether the enterprise has the present or future capacity to generate more than a minimal living for you and your family, or will make a significant economic contribution. That is a question about the business's earning capacity, not about how comfortable the household reserve looks. Projections should rest on stated assumptions — pricing, volume, hiring — that someone else can test. There is no ten-job requirement. Projections come apart on an assumption nobody states: that the owner draws nothing. A plan showing a modest profit in year two while the founder takes no salary is describing a business that cannot yet support the household, whatever the bottom line says. Put the owner's compensation into the model as a line, and see whether the figures still hold.
Prudent reserves, and the foundations underneath
Keeping a living reserve is prudent household planning; presenting that reserve as invested capital is a different thing, and the two should never blur in the paperwork. Also confirm the foundations early: treaty nationality follows citizenship rather than Canadian residence, at least half the enterprise must be treaty-owned, you must genuinely develop and direct it, and you must intend to depart when your status ends. The foundation checked last is usually the one that decides everything. A household spends months on a business plan and then discovers the nationality question was never confirmed, because Canadian residence was doing the work in everyone's head. Confirm citizenship, the ownership percentages after closing, and who will actually direct the enterprise before the plan is built around them, not afterwards.
Sources reviewed 2026-09-07. This guide covers a preparation focus; it is not an individual eligibility assessment.