As a small business in Canada, a lot of opportunities are given to you to support entrepreneurship. One of these opportunities that the Canadian government offers is government funding in the form of small business grants and loans. But what are small business grants and loans? Who are they for? How do you you get them?

These are the typical questions that a small business owner may have when talking about starting a small business, expanding one or searching for funding. So let’s take a few minutes to answer these questions together.

What are small business grants?

Small business grants are programs offered through the various levels of the Canadian government to small business owners. These funding programs are provided to help to stimulate the economy, to create jobs and to support entrepreneurship across Canada.

Small business grants often come in various forms and are often considered to be “free money” that a business owner or entrepreneur can apply for. However this is one of the general misconceptions about government grants that most have.

Government grants for small business owners come in many forms; and while some can be non repayable funding options, there are different types of grant programs.

What are the different types of small business grants?

Government grants can be a great way for a small business to startup or an existing business to advance and grow. The different types of government grants that a small business may apply for include:

Non Repayable Government Grants

A non repayable government grant is one of the most preferred types of funding that a small business owner would want to obtain. Why? Well because it’s non repayable. Meaning that once you obtain the funding of this nature, the money received does not need to be paid back.

Partial Contribution Grants

Partial contributions are also government grants, however in many cases the government agency that provides this small business funding will require the business owner to contribute either a percentage or to match the funds. For example: the govenrment may give a business owner $25,000 towards certain business expenses if they invest 20% of their own funds towards the same. These grants are also non repayable, however as mentioned they may require a percentage to be put up by the owner.

Conditionally Repayable Grants

Conditionally repayable grants are still considered grants, however they do come with conditions. When you apply for a conditionally repayable grant, you are applying to funding that sort of a loan (however with no interest) and only repayable based on a condition such as “when you start becoming profitable” , or  “repayable in your 3rd year of business”..etc

When it comes to these types of small business grant programs, each program or agency that hands out this funding has it’s own conditions.

Subsidies

Small business subsidies are often grant style programs that provide funding towards hiring or training employees. There are certain programs that will allow you to hire employees and the government wage subsidy provides you “non repayable” funding, or a contribution towards your employees pay.

While these 4 are the top grant programs, there are often programs that may not have the title of “grants” but often act as a grant. For example tax breaks of tax credits are often similar to grants and money that you don’t have to pay back (except it’s based on your spending).

Who are small business grants for?

Small business grants offered by the government are made for small business success and to support entrepreneurship. Each funding program and each funding agency has it’s preferred applicant, and this is something that you would be able to find out based on the program criteria.

Certain things to keep in mind when trying to figure out if funding programs or small business grants are available for your small business include:

• Knowing if the programs are available in your location
• Knowing if the programs are available for your industry
• Knowing if the programs are available for your specific funding needs
• Knowing if you meet the eligibility and qualification requirements set by the program

Small business grant programs are mainly focus on helping companies startup, to hire and train staff..etc; and less likely for purchasing business, advertising costs, equipment costs..etc

How do you get small business grants?

To get a government grant or funding for your small business, it’s as simple as searching for the programs, making sure that you meet the criteria, developing your business plan and completing he funding applications.

While it sounds easy, it’s a pretty difficult task. The toughest being the search for funding.

Since the Canadian government has hundreds (nearly thousand) different funding programs, to find the one you may be eligible for, it’s pretty difficult. Especially since they are scattered by various agencies across Canada.

Many small business owners turn to the Funding Database to locate funding, instead of trying to research and dig for programs wasting weeks upon weeks.