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Financing

The success of your business depends on your having enough capital to purchase needed equipment, buy inventory, and pay overhead costs such as rents and salaries, plus additional working capital to enable you to take advantage of opportunities or survive temporary setbacks. Your financial requirements will generally fall into two main categories:

  1. Initial costs: land, building, fixtures, equipment, supplies, vehicles, pre-opening expenses and opening inventory
  2. Daily operating costs: rising inventories, payroll, rents, taxes, advertising, accounts receivable, etc.

Financing your business will come from a variety of sources. The guide to financing, prepared by Business Services at Ottawa Public Library, includes the titles of Iain Williamson’s annual series on financing a business in Canada.  Use these for finding specific contact information and unusual funding sources.

The following are government information and programs for financing business

  1. FedDev Ontario Small Business Services > Financing a Business Guide gives an overview of the sources of financing to explore.
  2. Innovation Canada's Business Benefits Finder is an interacitve tool allows you to explore options for government funding.
  3. Canada Small Business Financing Program (CSBF) The CSBF seeks to increase the availability of loans for establishing, expanding, modernizing and improving small businesses by encouraging banks to make financing available to small businesses.
  4. Business Development Bank of Canada (BDC) The Business Development Bank of Canada (BDC) is Canada’s bank for small and medium-sized enterprises (SMEs), delivering financial and management services, with a particular focus on the emerging and exporting sectors of the economy. The BDC has a number of financing programs for a variety of business needs. 
  5. Export Development Canada (EDC) For Canadian exporting companies, Export Development Canada (EDC) can help you access a performance guarantee for your contract without tying up your cash or operating line. Companies often need financing to support their international transactions:  to pay for the up-front costs associated with the production of a large export order, to expand into new markets or to respond to a buyer's request for financing.
  6. Community Futures Ontario (CFO) Community Futures Ontario administers local investment funds to help finance new or existing small businesses for start-up, expansion or stabilization plans that help maintain or create jobs in Ontario’s rural and northern communities. All CFO financing decisions are made at the community level by the local boards of directors.

Other types of financing

  1. Micro-Credit Ottawa Community Loan Fund (OCLF) and Alterna Savings, along with Caisse Desjardins, offer micro-loans.  These loans are typically for entrepreneurs who have not been able to secure financing through traditional lenders.  Microcredit lenders often offer assistance in conjunction with their loans.
  2. Youth Programs Summer Company is administered by Invest Ottawa and provides hands-on business coaching and mentoring, and awards of up to $3,000.  Futurpreneur loan program provides loans and mentoring to young entrepreneurs between 18 and 39.

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