You’ve most likely seen the ad’s all over the web showing you government checks with thousands of dollars on them and happy individuals holding them. While some of these are real, the majority you will see are fake stock images that are used to attract and fool unsuspecting startup entrepreneurs and business owners. In fact, the Canadian government warns people of such websites guaranteeing government funding in exchange for a percentage or a dollar amount to register.
The fact is though, the Canadian government actually hands out Billions, that’s right billions with a capital “B”, to small business owners and entrepreneurs across Canada. The only set back that we as entrepreneurs have is that the government of Canada is not just one government agency. This means that the government funding for small business owners actually comes from multiple levels of the government (local, provincial and federal), and through multiple funding agencies. In fact, there are nearly a thousand government funding programs for small business owners available.
We here at CanadaStartups took some time to create this guide to help you with your small business government funding search.
What is Government Funding?
Government funding is a broad term that is used to explain what the different levels of the Canadian government offer as a form of assistance and support to startup and existing small business owners across Canada. As a Canadian citizen, one that pays taxes, you are entitled to apply to and benefit from potential funding for your own business if you meet the criteria by the funding agencies.
The Canadian government created these assistance programs in order to actively stimulate the economy, create jobs and to support small businesses and entrepreneurship. In other words, as you pay taxes, a percentage of your taxes are taken and given to thousands of businesses across the country in order to improve the overall economy, so more money can be put back into the country and ultimately you have a better life.
Types of Government Funding:
When we talk about government funding, it doesn’t always mean that it has to be offered in a monetary form. In fact, the Canadian government and it’s multiple agencies offer government “support” in the form of government grants, government loans, tax breaks, tax credits, consulting services and support. Not all business owners applying to the various government agencies are in need of financial support, but some benefit from the various mentorship programs, training programs, consulting services…etc. While others benefit from the one time grant contributions, low interest or no interest loans, government guaranteed loans and tax breaks or credits. Each situation and business is unique.
Who Can Benefit From Government Funding?
Usually those who apply to the various government funding programs are the ones that are benefiting. However on a larger scale, those who benefit the most are individuals looking to start a small business and those who are looking to expand their current/existing small business. The government of Canada provides funding programs and assistance to help you start your small business, conduct research and development, to help you create your business plan, to hire and train your employees, to help you pay for marketing and advertising, to help you purchase tools and equipment for you business, to help you with day to day cash flow and much more. If any of these situations apply, you are more then welcomed to look for potential funding and seek assistance.
Why Apply for Funding?
Why apply? It’s easy. If you need funding or support, you need to apply, otherwise it won’t just come to you. As much as the government of Canada and it’s various funding agencies want to help and support entrepreneurship, they won’t just come and hand you a check unless you make your self known and apply.
If you need to start your business and you need funding for any of the above mentioned funding purposes, applying to the various government funding programs could help you get funded.
The Usual Funding Requirements:
Since there are so many (nearly 1,000) government funding programs available from many levels of the government and different agencies, there are no “usual funding requirements” in order to be successful with your funding application other then the regular business requirements.
You should probably have a business plan ready. Don’t waste your time or the funding agency’s time by applying without having a business plan ready. At the same time, be sure to read the program requirements and all of the criteria. Be sure to meet all that the funding agency asks for, otherwise you are simply wasting each others time. And most importantly, be clear as to what it is you are looking for (if money – how much and what for).
One important thing to remember is that each government funding agency gives it’s program directors a set budget for the program. This means that the program director has to “spend” or “allocate” that money for the year/term in order to get that much or more the following year/term. It is important to apply to the funding program on time (meet the deadlines), and it is as much important to ensure that you don’t ask for too much, or that you ask the wrong place. So, be sure to have contacted the right funding agency, about the right funding requirement and ask for the right amount of money in order to be most successful.
The Search for Funding Process:
The search process, or the reason why we created this quick little funding search guide for our audience is because the search process for government funding is extremely complicated. Here’s why:
- The government funding programs are not all offered by “the Canadian government”, but are offered through multiple levels of the government
- The funding comes from hundreds of different funding agencies
- There are location (city, province) specific funding programs
- There are industry specific funding programs
- There are funding requirement specific funding programs
- Majority of the funding programs aren’t promoted (or extremely hard to find)
- The information available on funding programs is limited
- The information available on funding programs is scattered all over the place
- It is very time consuming to research and find government funding programs
- You probably have better things to do…
As you can see, we aren’t lying. If you’d like to try it out for yourself, we suggest 1) visit the various government sites to find the information you need, 2) if you find a funding program, try to find the application criteria and see if you understand how to apply…if you are successful, we applaud you. However since the above list of 10 issues when it comes to searching for funding stands in your way, it is often beneficial to get a little bit of help.
After all, focusing on your small business and ensuring that the rest of the steps are taken to ensure successful startup or expansion is key. Don’t waste your time doing the research and trying to figure our where to find the right programs, instead take advantage of sources that are available to you, that have already done the work and are here to present you with the right programs, the right criteria, leaving you with 2 main responsibilities, to complete your business plan and to apply for funding.
Remember when searching for funding, start with your location first. As many funding agencies are location specific, be sure to search for programs or program agencies that only focus on your target area. This will narrow your search from thousands, to hundreds. The next step is to cut that number down further to the more specific programs that only fund the industry or industries you may be in may be targeting with your small business. Step closer to success by narrowing your funding search even further and focus on funding programs or funding agencies that fund business owners with specific needs such as marketing/advertising, improving cash flow, purchasing tools/equipment, hiring/training staff..etc. This will take you to a few programs which you may be eligible for.
The next step is to apply.
One thing that the government of Canada warns individuals is to stay away from websites selling government funding information, as it is free information that you shouldn’t be paying for. There are some exclusions to that, for example consultants, grant writers and funding experts. They will not only find the programs for you, but will help you apply. However, they are usually pretty expensive, ranging anywhere between $2,000 to $5,000+, and not to mention that they often seek a percentage of the total money awarded.
So is it a scam? If you do your research right, and if the consulting firm/grant writer or the funding experts are able to provide you significant documentation that they are able to do what they ask, it’s not a scam – however it is pretty expensive. And still be sure to remember that no matter who applies for you (you, a funding expert, a consultant, lawyer, accountant or a dog), there are no guarantees of any funding. Only the government, or that funding agency is able to give the Yes or the No to you being funded. So be sure to keep that in mind.
Our platform can be of help. CanadaStartups has created the Small Business Startup Portal which helps small business owners with the exact problem. Our platform is a one time fee of $297 to join and become a member and with that you are given access to our Startup Guide, Interactive Startup Timeline, Investor PitchDeck, Business Plan Builder and the Funding Database. Our Funding Database has nearly 1,000 funding programs offered by the government of Canada (along with all of the details you need), plus nearly 900 private investors that could be your alternative.
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