10 Unbelievable Stories Of Government Funding Recipients (the good and the bad)

The government of Canada provides funding to small business owners all across the country. Some of these government funding options come from the local government, while some from the provincial level and the federal government of Canada.

Government funding is often approved on specific funding need usage bases. This means that there are various government grants, government loans and tax break programs that business owners use to benefit from the financial support.

All government funding options are in place to help boost the economy and to help your small business grow. This ensures that the available government funding options are made available to startups as well as existing business owners as well.

With that in mind, there are certain rules that do need to be followed to ensure that the funds you obtain via the government are used properly – and not misused. While in most cases, applicants use the funds towards the proper needs, there can be some funny business.

In this article, watch us discuss 10 unbelievable stories of government funding recipients, some good; some bad – to learn from and to avoid.

Keep in mind that anytime you are ready to do a funding search, to see all government optionst that are available, the Funding Database can get you access to over 1,500 government grants, government loans and various funding options. You can be the next “good” success story!

$25,000 government grant

Cindy, from Oakville, Ontario has successfully secured $25,000 in grant funding to help with leasehold improvements required to get her flower shop up and running. Cindy has been refused 5 times over a period of 6 months for a grant which she desperately needed to make needed modification to her business, to allow for longer-lasting inventory and a better presentation of the interior and exterior of the business. What makes this an unbelievable funding success story is that Cindy has remained persistent with her applications, which constant updated to her business plan to accommodate what the grant agency focused on. 

$72,000 government loan

Bradley, from Hamilton, Ontario was successful at obtaining a $72,000 government loan, with a conditionally repayable term, allowing for no repayment for initial 12 months of business. The funds were approved to help Bradley and his construction company to pay for new staff and to cover various costs of sending staff for proper safety training. The funds were approved for wages support and training; however the funds ended up being used for purchase of equipment, including that of a used picku-up truck for Bradley himself. Once the government agency that approved the funds got word, the funds were sent to collection – as it is against the agency terms to fund anything but training and wage support.

Remember, if you apply for a certran funding purpose; only use the funds for this, otherwise risk a penalty and the risk of having your funds paid back.

$12,500 in tax credits

Charles, operating a successful web design business out of Richmond, BC was successful at obtaining a tax credit for his digital spend, after sharing his receipts and invoices of his expenses during the previous year’s budget. $12,500 in tax credits came in handy, as it has helped Charles advance his business further in the following year.

Tax credits are not unbelievable, but what makes this government funding success story an unbelievable one is that Charles has been in business for 16 years; this is also his 16th tax credit he has obtained – with a total of $186,000 start to date. 

Most business owners skip over tax credits as they first have to have spent the money – but Charles in this case received over $180,000 in tax-free, non repayable money back in his businesses pocket.

$100,000 government grant

Maureen and her wellness spa, out of Edmonton, Alberta succeeded at obtaining a $100,000 non repayable government grant after expanding her business and hiring multiple technicians to work within her 2 locations in Edmonton!

The non repayable government grants came in handy with the very much needed expansion as it enures that Maureen can payu her new staff a solid wage, while she boostys the bottom line with added new services and revenue growth.

What makes this unbelievable is that Maureen was initially approved for a $120,000 loan, which she desperately did not want – but accepted as it helped her grow – but continued to wait and to apply for government grant options, which ended up giving her the $100,000 grant that helped her succeed.

$250,000 in non repayable government grants

Vince, from Brampton, Ontario obtained a non repayable grant for $250,000 to help his transportation and distribution business move towards a greener emission focus. 

Vince has applied for the same grant multiple times over a period of 12 months; however kept getting denied due to lack of revenue to allow the modification to his trucks and warehouse; that would enable emission funds.  Vince, utilized private loans to bootstrap the business and obtain the needed certifications, which also allowed him to be approved for the next grant application and successfully obtain the $250,000 in funding!

$92,000 from multiple government grants

Pavel, from Montreal, Quebec was successful at obtaining 3 different grant programs over a course of 12 months, for a total of $92,000 in funding. Unfortunately, Pavels mission was not to succeed with his business, but to find a loophole that would allow $92,000 in “renovation and hiring costs” to be used for personal gain. At the time the agency requested receipts of Pavel’s investment, Pavel was unable to do so, causing a negative impact on the file, with a costly penalty being applied with a strict repayment and collection schedule on the funding obtained.

Lesson: Don’t borrow funds you don’t plan on using for your business – correctly.

$377,000 a government backed loan

Lesley, from Saskatoon, SK, obtained $377,000 in the form of a government backed loan to help with her purchase of a new franchise. The funds were used towards the purchase of the franchise, including her down payment, but also to help with development of the building space required to run the business. 

What is unique or unbelievable about this you ask? Lesley has a 400 credit score and on her own was unable to get approved for even $5,000 on a personal loan; however she managed to save $50,000 over a period of 3 years to use as her downpayment and worked extremely hard to find a business partner with a better credit rating, who in collaboration with, managed to obtain the backed loan of $377k with a 75% government guarantee!

$125,000 partial grant contribution

Jacqueline and Dino from Winnipeg, Manitoba were extremely over the moon when they were approved $125,000 from the government in the form of a grant to help expand their in-home nursing care service. The funds came in the form of a partial contribution, which required Dino and Jacqueline to come up with 30% of the needed funds of their own to be eligible. 

Dino, took on a second job, working nights to save the needed funds so they can be confident that once they apply, that one chance before the program deadline, that they stood a chance at securing the funds. The extra work paid off!

$500,000 in funding for equipment

Davel from Pickering, Ontario, successfully obtained a $500,000 grant from the government to help his farm lands with a new irrigation system, better equipment and improvements to his land structures however quickly the deal fell through when Davel was unable to provide documentation proving his ownership of the land/farm – instead, was found to be an employee of the farm trying to maneuver the funds into his own pocket.

And lastly $427,000 renovation grant and loan a bad situation where Michael, from Vancouver, BC was approved for a small grant of $27,000 and a government loan of $200,000 for a cannabis based business venture. After being approved, Michael was unable to provide the required legal documents to show the licensing and approval as initially “verified” and both options were refused in the end. Michael spent 6 months working towards the verification process and obtained the needed documentation; contacted the grant agency and the loan agency back – and after some negotiating, was re-enabled the funds.

This time around, Michael was provided with a double amount loan, totaling $400,000 as well as a $27,000 grant to help take his business forward.

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When dealing with the government, there are plenty of good and bad scenarios. The good thing is that there is a lot of potential to get your business funded, via many different funding sources and options. But, if you don’t follow the rules, you risk the potential of a downfall, and like some of these unbelievable businesses learned, a penalty can be that downturn your business really doesn’t want.

It is a crime to use government funds illegally. Using these funds incorrectly could also result in a massive penalty and a risk to your business.

The government funds approved should only be used for the specific purpose they were approved for.