There are close to a dozen US angel investors in a company I co-founded in Canada - to my knowledge (and I'm pretty sure it would have come up) none of them had to go through anything particularly onerous in order to give us money. Two of those angels also sat on our board, and were pleasantly surprised to find out the difference in liability as board members between Canada and the US.

Previous startups I have worked for in Canada have all gone south of the border to raise either VC or Angel funding, so I suspect that this problem is somewhat over hyped. That said, everyone likes to remove friction (and accounting/legal costs) from raising money, so the change in law is a good thing.

As another aside, a Canadian company can multiply investment (certainly at the level of Angel investment) by as much as three times thanks to various Canadian R&D programs (IRAP and SRED), and Canadian investors usually qualify for the lifetime capital gains exemption, which can make an exit even more appealing (who doesn't love a tax break?). So there are some good reasons to invest up here.

Really? Investing in Canada must be really bad then because moving to the US is not easy. (At least not if you aren't sponsored by BigCo whose large legal department will take care of the insane paperwork for you)

If you have a degree and a job offer, as a Canadian you can apply for a NAFTA visa at the border - it's not a sure thing, but it usually isn't that much hassle.