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GTAN|EDUCATION FOR ENTREPRENEURS - Government Funding for Start-Ups

April 2, 2019 / Source: GTAN

On Tuesday, April 2nd, Gerry Fung, CPA, CMA, Group Manager of Business Services at NorthBridge Consultants, hosted GTAN|Education for Entrepreneurs - Government Funding for Start-Ups.

When funding growth, start-ups should always look towards non-dilutive funding sources to preserve a larger share of control over the company. One of the main advantages of situating your start-up in Canada is the many federal and provincial funding programs accessible to start-ups that can total over $20 billion each year. This workshop addressed non-dilutive government funding, SR&ED Tax Credits, and government grants, loans and funding.

Government funding exists to close a funding gap. There are both direct and indirect government funding options.

Indirect - historical costs - tax credits

  • No limits in overall funding
  • Non-discriminatory and widely available across firms, sectors, fields and activities i.e. the government does not “pick the winners”
  • Less amenable to being steered toward specific area

Direct - future costs - grants and loans

  • Limited overall funding
  • Targeted to specific areas
  • Inherent project, regional, or sector bias
  • Ability to focus support on activities considered more likely to achieve high social returns
  • Generally involves more rigorous selection and evaluation process, i.e. the government will “pick winners”

SR&ED Tax Credits (Scientific Research and Experimental Development)

Administered by the Canadian Revenue Agency, SR&ED Tax Credits encourage Canadian businesses to conduct R&D and help offset risks and encourage economic development as all work must be conducted primarily in Canada.

To be eligible, a project must meet the following criteria:

  1. Technological Uncertainty: What was the obstacle that had to be overcome, or what was the concern that couldn’t be solved based on current industry knowledge?
  2. Technical Content (systematic investigation): Is the work evident of investigation, experimentation, and/or analysis by qualified personnel?
  3. Technological Advancement: What did you do that was above and beyond standard knowledge in your field?

Government grants and loans

The Canadian government also offers hiring and training grants:

  • ICTC Career Focus (The Information and Communications Technology Council)
  • Youth Employment Fund
  • Canada Job Grant

Other Government Funding Programs include:

  • IRAP (Industrial Research Assistance Program)
  • Ontario Centres of Excellence (Non-Repayable Contributions & Investments)
  • Innovative Solutions Canada (New program under Innovation, Science and Economic Development - ISED)

NorthBridge Consultants can help you identify eligible projects, collect and organize documents to support projects, assist with project management, narrative writing, expense allocations, assist with the review process and on-going tracking.

Do you have a fresh, new idea and are looking for investors? The next GTAN|RAW event is on Tuesday May 7, 2019. Learn more about pitching at GTAN|RAW here.