You might have a great business idea, but do not have enough of your own money and capital to invest, so you will need to borrow money to get your business off the ground. This raises the question, where does someone look for funding if they are a small business in Canada?
Business Loans From Canadian Banks
Business loans are only possible if the company has been in business for some time, and even if you can get a small business loan, interest rates from traditional lenders such as banks can be high. Most new businesses are looking to expand and so business owners need other options to raise business capital.
Canadian Government Grants
Government grants are another possibility. However, the process of obtaining funding this way is notoriously difficult. The Canadian government does have grants available for small businesses that can boost the Canadian economy, but for the most part, the bar is typically set high, in terms of availability. Getting a grand from the Canadian Government can be a long drawn out process and not every new business is likely to meet the acceptance standards. However, it certainly worth investigating to see if your business qualifies. This can work if your business targets one of the growth industries, or sectors that meets the requirements of a particular Canadian government agency.
Seed Funding Options in Canada
If you're looking for a small investment to get your business off the ground, then you might consider friends and family as an option. This can work well for first time businesses, but if you've already borrowed money from friends and family in the past, and your business hasn't been a success then this line of investment may have already been exhausted.
Some entrepreneurs even start their businesses off of a credit card, but with the high interest rates and typically small credit card limits, this can be a high risk strategy and more trouble than its worth. If you have a business idea for a product or service that requires some early-stage business development investment, then another option is crowdfunding. This doesn't work for everyone, but for some ideas and markets this can work well.
Find Canadian Angel Investors
A more common options for business funding are angel investors and venture capitalists, both of which will invest significantly higher amounts in your start-up or small business. However, both angel investors and venture capital firms will want some control of your business and guarantees of a good return on investment in exchange for their money. But at the same time, they offer the experience which could be that factor which allows your business to succeed in the first place.
Remember, the potential investor is looking to make money just as you are, and so it will be a venture that both sides enter together as a partnership. This means that anyone who invests in a small business will do everything possible to ensure that they are making a sound investment to get a high return on their capital. They will check your business plans thoroughly, and make sure that they themselves believe in your business idea and future plans.
How the Canadian Investment Network Can Help
Finding funding for your small business or start-up can take a long time, but the Angel Investment Network can help you make vital contacts with experienced high net worth angel investors who are looking to make an investment. Alternatively, if you're an investor looking for Canadian businesses to invest in, then you can sign-up to the Canadian Investment network to search for businesses and entrepreneurs, across a wide range of industries.
You can find entrepreneurs and investors based all over Canada from Vancouver to Toronto. Moreso, since the Angel Investment Network is global, you'll also be able to find business ideas and investors from all over the world.
As with all business deals, you should carry out your due diligence to ensure that your business investment is viable.