As you’re looking for ways to fund your small business, you’ve likely come across numerous suggestions and terms. Between loans, tax credits and other forms of financial support, Canadian entrepreneurs can explore a few avenues to help them take the next step in pursuing their dreams of business ownership. What about grants?
Also known as subsidies, rebates, nonpayable loans and awards, grants are a funding opportunity you can pursue to jump-start your small business. Unlike loans, which you have to repay, or tax credits, which you must qualify for through specific tax parameters, small business grants are dedicated funds entrepreneurs can apply for when they need support. While grants come with varying requirements, you rarely have to repay them — and that’s what sets them apart.
Below, you’ll find information about small business startup grants in Canada and how they work.
Small Business Funding Opportunities
No matter what province your business is in, you have access to several small business funding opportunities. You can explore three primary types of funding — government, private-sector and nonprofit. Within each category, you’ll find numerous grants.
Here’s a quick look at each source so you can better understand which suits your business’ needs best.
- Government funding: Through the federal and provincial governments, you can find funding for various applications. These grants focus on helping small businesses grow, so you’ll typically find opportunities for hiring, investing and more. Additionally, the government aims to assist multiple industries, so whether you’re involved with book publishing or international shipping, you can rest assured government grants are likely available to you.
- Private-sector funding: Pursuing private funding means you’re receiving a grant from an individual or a private company. This source could be an angel investor, an incubator group or a crowdfunding platform. If the money you receive doesn’t come with repayment requirements, it likely qualifies as a grant.
- Nonprofit funding: Multiple nonprofits offer small business grants across Canada. These organizations can be networks, foundations, counsels, universities and other structure types. Typically, a grant’s requirements will depend on the organization offering it. For example, a nonprofit focused on Indigenous rights may only accept applications from small businesses that share their goals.
Types of Grants to Start a Small Business
Among the avenues you can explore for grants to start a business, you’ll find general and specific options. While all awards and nonpayable loans come with some application qualifications, many are more particular than others. A general grant may offer funds to all businesses that have fewer than 500 employees. Alternatively, you may come across more specific grants geared toward women-led businesses in education.
Here are a few examples of Canadian small business grants that target different business owners.
Grants for Women Small Business Owners
Across Canada, governments, private companies and nonprofits provide small business grants for women. As of 2016, 85% of Candian women said they had entrepreneurial goals — and subsidies and rebates geared toward women help them achieve their dreams.
Private Grants for Small Business Owners
Often, individuals and companies will set aside money to help support startups in their communities. Note that grants may not only be monetary. For example, you may get a grant from an incubator that includes a small financial contribution and access to mentoring and office space.
Grants for Minority Small Business Owners
In Canada, minority small business owners are few and far between. As of 2017, just over 12% of small businesses in Canada were majority-owned by a visible minority. Because finances can be a significant deterrent to launching a startup, you can find an increasing number of minority small business grants. An example would be the First Peoples Economic Growth Fund: Business Contribution Fund, which provides grants for businesses owned by Manitoba First Nations peoples.
Grants Based on Industry
Depending on the industry you’re in, you can apply for specific grants to support you in that sector. Whether you work in apparel, technology or conservation, you can find sources that assist you in your particular field. For instance, Canada’s Music Incubator supplies up-and-coming musicians with various resources to build their brands and businesses.
Federal Government Funding Sources
For many businesses, starting with federal small business grants is the most accessible option. These nonpayable contributions assist businesses all over Canada. If you search the official government website for grants for businesses of all sizes throughout the country, you’ll find an extensive list of grants that may work for you.
Check out a few other examples of government grants for small businesses.
- Commemorate Canada Program: Funds initiatives that celebrate “historical figures, places, events and accomplishments of national significance” with up to $10,000 in grants.
- Strategic Innovation Fund: Funds businesses that positively contribute to a productive economy with up to 50% eligible costs of a $20 million minimum budget.
- NSERC Alliance: Formally known as the National Sciences and Engineering Research Council of Canada, the NSERC Alliance supports research and development collaborations between businesses and universities with up to $1 million yearly.
These three examples are only a glimpse at the plethora of funding opportunities the Canadian federal government provides. To find more grants that align with your business goals, look at the official government website and modify your search accordingly. The Business Benefits Finder tool provides the most comprehensive results.
Tips for Applying for Startup Business Grants
Before you send out multiple applications for awards, subsidies and other types of grants, you should remember a few tips. These applications can take time, so preparation is essential. The following are a few handy tricks for ensuring you and any business partners know how to get a small business grant.
- Finalize your business plan: Note that almost every grant you apply for will require you to submit a business plan so the grantor can ensure you meet their requirements. Check that your business plan aligns with the recommended parameters.
- Know your terminology: As stated earlier, grants go by many names. This style of nonpayable funding may also come in the form of subsidies, rebates, nonpayable loans or awards. By incorporating grant variations in your search, you can broaden your reach.
- Search based on specific criteria: Remember that grants depend on various qualifications. Do you plan to launch a health care startup? Are you a nonwhite entrepreneur? Consider your business’ unique characteristics to help you narrow down your search.
- Understand all requirements: Most grant opportunities are competitive. To ensure your application is correct and relevant from the beginning, you must understand the grant’s requirements. Do you have to submit a project proposal? Is the grant only available to a specific group of people? Be sure to read every fine detail.
With a broad search and thorough preparation, you can successfully apply for the maximum amount of small business funding.
Reach out to CPA4IT Today
Aside from grants and other kinds of nonpayable funding, corporate tax returns can help increase your finances. At CPA4IT, we help businesses correctly file their corporate tax returns, ensuring they get the most return with our experienced team’s assistance. To learn more about our services, book a free consultation today!
