According to Statistics Canada, in 2011, only 18% of all incorporated businesses in this country reported accessing any kind of government grant program, despite the many programs available. Some examples include support related to job-specific training to create new jobs, the development of new industries in single-industry regions, and innovation in production methods or research and development to reduce greenhouse gas emissions or water pollution, to name a few. These are all policy areas determined to be important to Canadians and the functioning of the Canadian economy.
Why isn’t this statistic significantly higher? Wouldn’t every CEO and business owner benefit from an injection of cash to undertake a special project or to help them expand in a certain area? Although the answer may seem obvious, there are hurdles to overcome for small- and medium-sized companies to access these opportunities.
First, it requires significant research to learn what grant opportunities are available. There is no one-stop shop. If you’re busy running your business and are tight on time and labour, you may not consider it an effective use of resources. When entrepreneurs become aware of available grants, deciphering the requirements and eligibility can often seem like an unsolvable puzzle.
I recently told a client about a program I had come across to improve her ability to sell online that I thought would contribute to her business. Her response after perusing it was, “Not for me, I’m already online.“ I explained how I had looked it over and had a similar reaction. However, after a conversation with the administrator, I discovered that I met their eligibility and went through the process to access the funds. I was quite sure there would be eligible expenditures to support her business too. She took another look and indeed she was, and she has received funding.
Sometimes, the language of a program, even with the government’s best efforts, is not obvious to those not familiar with grants. There are other factors too, like having a solid business plan already in place. Some worry the reporting and administrative burden may be too great for the amount of funding they are receiving. Some might prefer not to be involved with government grants at all, simply because they don’t trust the process.
Level of Funding Is Directly Related to Investment
Even for small grants of less than $10,000 the application process may appear time-consuming and complex. Many consider the process too lengthy for the funds available. There is an assumption that it is a competitive process and only the big operators with connections will be awarded the grants. If less than 18% of businesses apply for funding, the evidence points to it not being a very competitive process. What I know after 20+ years working in the development and delivery of government grants and loans, it is not a competitive application process. It is a fair and equitable process. Every region has an allocation of funds, and all applications are welcomed. The key is to know exactly how your business can deliver on the priorities of the grant.
As the business owner, you will have to demonstrate your ability to use the funds effectively and have a long-term vision in place. Applying for a Canadian grant is a strategic and long-term investment that requires careful planning, research, and documentation. Many larger grants will require details of your business plan, projected budget, market rationale, and possibly letters of support from potential partners or customers. There will be a time lag between when you submit your final application and when you hear back from them. Typically, the administrators will tell you upfront what to expect in terms of time—from a few weeks for small grants and longer for larger funding applications.
The last time I visited my local optician, I asked her during our chat if she had a business plan. Her answer was no—no new plans for her business, although every year there were important changes in how she did business. She talked about putting together a plan when she went for a bank loan to open her business but hadn’t touched it since. She is not alone. Why is it small business owners don’t consider their business plans annually?
There is a lesson we can take from companies with rigorous reporting requirements, such as publicly traded companies. They will have business plans updated annually and processes in place to measure and report on important performance indicators more frequently. This process is an important milestone for every publicly traded business. Therefore, these firms can demonstrate their stewardship over the use of funds.
If you are like my optician, a firm with few shareholders or maybe only yourself as a shareholder or sole proprietor, you can step up your game by taking time to review your progress, writing it down, adjusting it as you know what will work for the next few months and starting to dream into existence your business plan.
Start with a review of your financial statements. Tell the story of your past year. Dream in a way that you feel and sense the opportunities in front of you and bring into being your plan for next year or the next three months. Write about each of the categories within your profit and loss statement. Your taxation reporting cycle is a good marker to place on your calendar to do.
Find a mentor or someone who wants to see you succeed and tell them about your plans. Let yourself be supported by others. It’s time and energy well invested in yourself, your dreams, your business, and your community. Every business large or small will benefit from planning. It sets you up to take advantage of opportunities when presented.
Get Ready to Be Funded
Some suggestions to be ready to take advantage of a grant opportunity are:
- Write down and review your reasons for being in business, your mission, values, and purpose. Where are you now and where do you want to go next.?
- What is your business structure? Are you incorporated? Most government grants require that you be incorporated. If you are not incorporated, consider updating your business structure and recommit to the reasons you are in business in the first place.
- Are your personal and corporate taxes filed in a timely fashion? Are there other reports to the government that you need to complete?
- What needs your attention to get your business to your next level of growth and impact? Is it new product development, testing, implementing new technology, or labour?
- Have a draft project plan, including team, timelines, estimated costs, and suppliers needed.
- Do you have other shareholders to involve in discussions?
Researching Funding Sources
Now you are in a good place to find a grant to support your business direction. Some variables to keep in mind when researching funding:
- Each government department will announce the availability of grants and contributions. Start with the departments federally and provincially responsible for your industry. The ones you may already receive newsletters from.
- If you’re in a smaller community, there may be others; check with local government officials and representatives who might know about availability. There is region-specific funding that may interest you.
- Is there alignment between the fund objectives and your business plans?
- Review the eligibility criteria. It is often related to location, gross sales, or number of employees, and industry. If it is not clear, ask.
- Have a conversation with administrators before investing time and energy into an application to ensure your project and their eligibility are a fit. Get clear about their reporting requirements in terms of timelines and documentation, such as invoices.
Seldom Recognized Benefits from Receiving a Grant
As you work to implement your new plan after you receive the good news you have been awarded a grant, here are additional benefits.
You may find that:
- Your upfront costs and risks of undertaking the project are less or offset more than you expected.
- Other lenders are more willing to lend you additional funds. The government’s due diligence process signals confidence and support for the project, which in turn encourages banks, investors, or partners to support it too.
- Your information management system will improve as you track progress for your grant, which may extend to all your record keeping. After all, what gets measured, improves.
- Your business receives increased visibility and a heightened reputation. You may also develop a greater network and connections with other stakeholders in the industry or sector. That’s free publicity!
- You are smiling. In those glimpses of insight and reflection, you realize that you too are being supported by Canadian taxpayers. They want and need you to be successful. You are part of a new story about our identity—no longer a country that merely supplies raw commodities for others to process and benefit from. You are creating success stories of innovation, and technology improvements and offering goods and products that meet the needs of a large country with a small population. In your way, you are making history.
Join a Monthly Workshop
Beyond the Story Coaching offers a monthly workshop for women business owners with a specific topic each month. Email cynthia@beyondthestorycoaching.ca to learn more about upcoming workshops.
Special Message to Government Funders
How do you see your role? Are you encouraging economic development or reduced environmental impacts through funding projects and reporting to the Minister? Or are you in partnership and collaboration with proponents who submit proposals, supporting them to meet reporting requirements and having impactful projects? What are your assumptions about who the proponents are? Or are they data points to adhere to a strict set of rules because there isn’t enough to go around? What if you had a collaborative partnership orientation and got rewarded for having a fully subscribed program with measurable impacts that any Minister would be proud to report on? No spin masters required.
What if you created a culture or partnership with industry? Take a lesson from Farm Credit Canada. They have a deliberate culture of collaboration within the organization and with their clients. And that leadership started at the top with the CEO and the senior management team. It is recognized by everyone within the organization. Deputy Ministers in line departments have much to learn from other successful organizations. Why not reach for a significant increase in the number of firms accessing government support? It would require letting go of fears, finding new ways forward and being in a place of generative conversations while ensuring the values Canadian hold true for equality, autonomy, peace, order, and good governance.