My experience with small business grants agencies (member story)

Welcome to another great member story. If you follow CanadaStartups’s blog you know that one of the things we like to do is share our member’s success stories, experiences and challenges with our audience. This time we are sharing a member’s experience with a small business grants agency.

On a daily basis hundreds if not thousands of people across Canada apply for government funding. Not just government grants but government loans, tax breaks, incentives, subsidies and more. Joel Braden from Toronto, Ontario was one of these entrepreneurs who heard about government grants around the time he was thinking about starting his very own small business. In the below discussion with Joel, we share his answers to some of the questions to help you get a better understanding of Joel’s experience dealing with a small business grants agency and how he was able to get a government grant.

The below is a transcribed conversation between CanadaStartups.org and Joel:

Tell us about your small business:

We have been launched for about a year and two months and specialize in custom work wear and uniforms. More specifically we take existing uniforms that many working blue collar professionals wear on a daily basis and customize their appearance with different designs, colors, patterns and personalized logos or name tags – depending on the situation and the order request. We coffer the Greater Toronto Area for now but are looking to rapidly expand as business has greatly picked up since the launch of our website and mobile app.

How did you first hear about government funding?

During the first phase of starting up our business we looked at so many different funding options; banks; governments; private funding..pretty much everything and government funding seemed as if it would be helpful due to the whole idea of grants being non repayable. I did a search on Google actually and found more info about government grants and loans and all that stuff here on CanadaStartups.org

What made you decide to search and apply for government funding?

I actually read a few success stories here on CanadaStartups.org of local business getting funding and actually recognized one of them and wen’t in to speak to them. After I realized that “it wasn’t difficult” we wanted to apply ourselves. Even though we actually called the government first to see if they would help. My thought was why pay $297 to get access to this private company when the government has the information free. After speaking to the government agency they actually told me there is no funding. So we gave up right away and went to the bank to apply for a startup loan. But to make this long story short, they said they needed a business plan and we didn’t have one. The same night I looked up business plan advice on Google and how to create a business plan to get funding and guess what, CanadaStartups again. That’s how we registered and accessed all the tools and started to search though all funding.

How did you find the funding programs if the government said there isn’t any?

Funny right? Well we realized that there isn’t just one government but all of these agencies are offered by different governments and different agencies, so speaking to one agency about funding for something else, they just don’t know about it, or maybe they didn’t care to help. We used the Funding Database here on your website to find a bunch of programs which we were eligible for and we applied. Plus made our business plan.

Did you have any help?

From the government? No. But after we registered here with you guys we actually used a few of your services such as the business plan review, funding application review and your experts helped us a lot.

Did you apply for just grants or just loans or a combination?

We ended up searching for programs and not really focusing on grants or loans. That’s the thing, if you need funding you just apply for what’s available. In our case, a few loans and a grant.

What did you need the funding for?

We had the startup costs covered for most of the things but really we needed help paying for a few tools and a machine that would do printing. That machine alone was $23,000 which we didn’t have.  Marketing, advertising, hiring and a truck would be the other stuff.  Pretty much we needed money for everything.

What was the funding application process like?

The applications were actually simple.  I mean to a point. It wasn’t difficult applying but it was hard to find the programs which we were eligible for. This is where your team helped a lot. I remember after I registered with you guys I searched in the funding database for printing machine and found nothing, then I searched for embroidery, nothing, truck…nothing. I  was furious why I just wasted $300 for this. But I was doing it all wrong as your experts showed us. There is nothing specific to any industry or business but there is for general needs such as “equipment”, or “tools”, so that really helped us isolate programs. After that it was pretty simple, just a matter of providing what was asked of us.

What did you have to provide to the funding agency when you applied?

Each program we applied to asked for different things but generally it was provide us with a business plan, forecast of your expenses and revenue and some financial documentation along with our credit history. For one of the programs we had to show financial statement from our bank account to verify we have money in the account for a partial contribution. Business plan was needed for all programs we applied to.

How long did it take for you to apply and hear back?

After applying it took about on average 3 weeks to hear back from each agency. There was one program that called after the first week to let us know they received our application, one program never got back to us at all and most replied one way or another within that 3 week period. 

What were some of the challenges?

The challenge was finding the programs #1, and #2 was the waiting – the more time we spent waiting was the more time we were losing applying to other sources since we needed funding fast to get our stuff in order.

How much funding did you need and for what?

As mentioned we needed a total of about $75,000. To break it down $23,000 for machinery, $22,000 for hiring, $8,000 for advertising and rest was for a truck for deliveries and pickups.

How did you know what to look for in terms of funding?

The team at CanadaStartups helped us with the search. They guided us as to what to search for and what to avoid.

How did you know you were accepted for a grant?

The grant program, or the director of the program actually called us for a part two interview. So we actually had to go in to sit down with 2 of the folks associated with agency and sort of explain what we were doing, why we needed the funding and how we intend to use it. It was the program for hiring.

Did you get funding for everything you needed?

No we didn’t. We did however get funded in the form of a grant for hiring employees and to cover their wages as well as a low interest loan for the machinery we needed. The others were denied.

After your acceptance what was the process like?

After we were accepted it was a matter of doing some more paperwork for each of the programs. As I mentioned we had to do a sit down meeting for the grant program but that was it. After we confirmed all and signed everything, there was sort of a training program or more like a quick lecture about how to use the funds and that was it.

How long after did you receive your funding?

Once all was good, it took another 2 weeks to get get the grant in the form of a direct deposit and for the loan we were actually sent to a bank which helped us out the same week we were approved. All together from the application date to the money in the bank for the grant it was 8 weeks and for the loan it was 6.

What was the experience like after getting accepted?

It was smooth. We were able to get a few things of the ground and the extra funding really helped us. So it allows us to expedite our startup and get everything we needed. With the acceptance of our application to the grant program we were able to hire 2 employees for 3 months at no cost to us; which really helped us with cash flow and  pretty much made us successful within the first quarter. 

What would you recommend to other searching and applying for government funding?

Use a search tool such as the one offered by CanadaStartups.org, the Funding Database. Spend your time wisely and not on searching but on applying. Having access to such as tool helps you locate funding so much faster. Also be sure to have a business plan ready before you apply to any funding program as it seems that they all need a business plan ready.

What is one thing you would tell others as a must avoid situation when applying?

In our experience don’t be discouraged if you hear a no, or if you’re denied funding. A lot of these funding programs are not connected to one another and simply don’t know about each other. If you call for help, the answer is always “there is none”, but it’s clearly there as you just have to look in the right place. But most importantly when you do search for funding, avoid searching for very specific things such as “truck”, or “salary”, or “printing machine”, instead think big picture and broad search such as “equipment”, “tools”, “wages”..and you will be fine. 

If you are looking for government funding information or need assistance with funding your own small business in Canada, give our Funding Calculator Tool a try before anything to determine if funding is available from government funding sources and/or from private investors.