Grants don’t come free; only a small number of them are actually untethered money.It’s challenging to come across legitimate government grants available for small businesses.
Lots of small-business owners desire government grants, which are funds offered to help them start or grow their qualifying small-to-medium enterprises (SMEs) without the requirement of repayment. It’s important to note that these grants differ from small-business loans, as the latter must be repaid.
Regrettably, the national government tends to favor providing support to small businesses through loan programs or assistance programs that involve some form of shared contribution, instead of implementing small-business grant programs.
Grants in Canada don’t come free, only a small number of them are actually untethered money.
When seeking a grant, most individuals hope to obtain free funds, particularly for entrepreneurial purposes. Regrettably, almost all available government grants come with certain conditions.
For instance, in many cases, small-business grants necessitate a financial contribution from the applicant. Therefore, although the grant itself is not repayable, you must initially invest your own money to secure the grant. The funders perceive this investment as a demonstration of your commitment, with a standard requirement ranging from 10% to 50%.
Furthermore, government grants commonly require the creation of job opportunities as a prerequisite for starting a new business. As an example, one of the criteria outlined in the Northern Business Opportunity Program—Small-Business Startup Projects states, “The proposed new business must be fully operational on a full-time basis and contribute to job generation in Northern Ontario.”
Government Grants Are Extremely Specific
The government offers grants to businesses with the aim of promoting the growth of specific businesses in specific locations. For example, they may focus on establishing a biotech center in Ontario or increasing the number of call centers in Nova Scotia.
This approach benefits those involved in the industries the government wants to encourage. However, the majority of entrepreneurs in Canada aspire to start small-scale retail businesses like bakeries, clothing stores, and bookshops. Furthermore, Small Business Grants often have eligibility criteria tied to a specific demographic and place of residence.
Here are a few examples of grants available for small businesses in Canada:
Grants for Particular Places and People
- Grants for Small Businesses in the Northwest Territories: The SEED Entrepreneur Support Program offers financial assistance of up to $25,000 per year to all businesses in the NWT to cover various expenses related to starting up, obtaining capital, sustaining operations, developing markets, and promoting products.
- Funding for New Farmers in Quebec: Individuals between the ages of 18 and 40 who aspire to become farmers and reside in Quebec can apply for a grant of up to $50,000 to support land enhancements, equipment purchases, and other relevant needs as they embark on their agricultural journey.
- Northern Ontario Heritage Fund (NOHFC): This fund facilitates grants and loans to facilitate employment creation in small to medium-sized businesses situated in Northern Ontario. Numerous programs are available to support business opportunities, growth, internships, and more. Specific qualifications vary depending on the program.
Grants for Particular Industries
Certain industries have an advantage when it comes to small business grants. For example:
- The AgriMarketing program has a Small and Medium Enterprise (SME) component that offers funding opportunities for SMEs engaged in the agriculture, agri-food, fish, or seafood sectors. The funding can reach up to $100,000 and is aimed at supporting projects that involve exploring new export markets or expanding existing ones. To meet the eligibility criteria, your company should have annual sales below $50 million, conduct market research, be prepared for export and market activities, and contribute at least 50% of the project costs.
On the other hand, the Centre of Excellence in Next Generation Networks (CENGN) provides technical and financial support ranging from $50,000 to $100,000. This support is intended for businesses and researchers who seek to accelerate the commercialization of their innovative communications technology, products, applications, or services. The eligible domains include software-defined network, network function virtualization, SD-WAN, internet of things/smart city applications, data center/cloud, network transport, applications, mobility, and security.
Partial Canadian Small-Business Grant Programs
You can receive “free” money through the grant programs listed below, but you will need to contribute some of your own funds:
- The Toronto Enterprise Fund offers grants ranging from $5,000 to $10,000 to social enterprises that aim to create employment and training opportunities for individuals facing difficulties in accessing the job market. These grants are designed to assist enterprises with promising social ideas in analyzing and testing the market.
For businesses in southern Ontario operating in the agriculture, agri-food, sustainable, or environmental technology sectors, the Bioenterprise Seed Funding Program provides an opportunity to receive up to $30,000 in seed funding. Additionally, participants in this program can access coaching and mentorship support services. It is important to note that applicants are required to contribute their own financial resources that match the grant amount.
Mtl Inc., an organization based in Montreal, focuses on supporting young and innovative businesses with high growth potential. They provide a grant covering startup costs of up to $30,000. To be eligible for these grants, applicants must be Canadian citizens or permanent residents between the ages of 18 and 35. They must also reside in Montreal and operate within the Island of Montreal or the South Shore.
Top Grants in Canada for Small Businesses
Small Business Grants that come without any obligations attached to them are rare and hard to find. However, there are alternative sources of financial support that are even more beneficial in the form of programs.
However, there is one condition you must fulfill. You need to be prepared to contribute in the required manner (often through your own effort and hard work) and show your dedication. If you meet this requirement, these programs provide funding for small businesses along with valuable guidance and support, which can greatly impact your chances of success.
- The Self-Employment Program stands out for its exceptional level of support it offers. Participants receive assistance not only in developing a business plan but also in receiving income support for a period of one year during the process. These programs are typically specific to each province, just like the example provided for Alberta. To be eligible for application, individuals must meet the requirements for Employment Insurance.
- In Ontario, the Summer Company initiative provides small-business grants, also referred to as awards, for students aged 15 to 29. The grants can amount to $3,000 and come with practical training and support for young entrepreneurs to operate their own summer businesses. Applicants should not be eligible for other self-employment programs, such as the Ontario self-employment benefit.
CBES is here to assist you; feel free to contact us for expert guidance.