Many startup companies fail within their first two years for a whole host of different reasons. When you’re running a start-up company, it can seem like you’ll need every possible government agency or policy’s assistance to succeed. While this isn’t really true, the relationship between business ecosystems and the government is very important.
The Canadian government is very business-friendly on both federal and provincial levels. The country is consistently ranked as one of the top start-up ecosystems in the world. Often known as the ‘engine of Canada’ – Ontario, Canada’s largest provincial economy, recently received the Canadian Competitiveness Award for the 6th time in 7 years. Ontario’s startup ecosystem is very forward-thinking. The province invests well in education, innovation, champions its quality of life, and welcomes the best talent from all over the world, and takes good care of its start-ups.
Types of Business Financing Support for start-ups in Ontario
Entrepreneurs looking to start a business in Ontario can enjoy a host of financing support for their businesses. The government encourages the start-up economy through resources, knowledge-based tools, grants, loans, tax breaks, and credits. The business community here is heavily supported by many other stakeholders, besides the government, like banks, not-for-profit organizations, industry-led organizations, and many more.
This guide provides an overview of grants and financing programs available for entrepreneurs who want to start a new business in Ontario.
As a Canada-based start-up, we also insist you familiarise yourself with the Business Benefits Finder. You can find hundreds of relevant funding options, loans, tax credits, wage subsidiaries, research, facilities, and more tailored to your province, goal, project area, and stage.
Government Start-Up Grants in Ontario
Government grants available to start-ups in Ontario come with individual sets of eligibility, terms, and audiences. Before applying for a grant, ensure that you fit their eligibility criteria because start-up grants are created for very specific purposes. A mismatch can lead to precious time lost for you as an entrepreneur and the funding agency.
If you are eligible, the next step should be to prepare all the required material and documents; your business plan will be crucial in this case. And finally, keep an eye on the last date of applications.
Here are the most popular grants for entrepreneurs looking for start-up capital in Ontario:
1. Starter Company Plus
By: Government of Ontario, Ministry of Economic Development, Job Creation and Trade
Brief Description: Business advice, guidance, workshops and funding to start a new company, expand an existing company or buy a business in Ontario.
Available Financing: C$5,000
For eligibility and financing terms, visit the program website here.
2. Industrial Research Assistance Program (NRC IRAP)
By: National Research Council of Canada Industrial Research Assistance Program
Brief Description: Start-ups that need research funding for developing and commercializing innovative, technology-driven new or improved products, services, or processes in Canada.
Available Financing: Contributions of up to 60-80% of internal technical labour and subcontractor expenses towards a specified innovation project.
For eligibility and financing terms, visit the program website here.
Government Financing (Funding, Loans, and more) for Ontario start-ups
Ontario start-ups can choose from various financing solutions tailored by the government and their partners for aspiring entrepreneurs who want to start their own businesses. Financing solutions can be low-interest loans, micro-loans, financial aid, access to capital, and more!
3. Canada Small Business Financing Program
By: Government of Canada, Innovation, Science and Economic Development Canada
Brief Description: Small businesses can get financing/loans from financial institutions by sharing the risk with lenders. Through this program, 53000+ businesses have received loans totalling over $10 billion in 10 years.
Available Financing: The maximum loan amount for a borrower is C$1.15 million:
- Up to C$1,000,000 for term loans for any one borrower
- Up to a maximum of $150,000 for lines of credit.
For more financing terms, visit the program website here.
4. Women Entrepreneurship Loan Fund
By: Government of Canada, Innovation, Science and Economic Development Canada
Brief Description: Microloans to start or grow your business if you are a woman entrepreneur, particularly from an underrepresented group or a sole proprietorship.
Available Financing: Up to C$50,000
For eligibility and financing terms, visit the program website here.
5. Community Futures Ontario – Access to Capital
By: Community Futures Ontario
Brief Description: Through Government of Canada funding, Community Futures Development Centres provide access to funds to help finance new/existing small businesses and social enterprises for start-up, expansion or stabilization plans. Find a local CFDC near you here.
Available Financing: C$150,000 or more on commercial terms through loans, loan guarantees or equity investments
For eligibility and financing terms, visit the program website here.
6. Futurpreneur Canada Newcomer Program
By: Government of Canada, Business Development Bank of Canada
Brief Description: Young immigrant entrepreneurs can avail of business loans without having an established credit history.
Available Financing: Up to C$25,000
For eligibility and financing terms, visit the program website here.
7. INVEST North Program — Investment — Launch Stream
By: Government of Ontario, Northern Ontario Heritage Fund Corporation
Brief Description: Get financial aid to start a new, full-time business in Northern Ontario.
Available Financing: Contribution of up to $200,000 to cover 50% of the costs
For eligibility and financing terms, visit the program website here.
8. Community Futures Network of Canada
By: Community Futures Development Corporations
Brief Description: Financial assistance for businesses located in a rural community that don’t qualify for federal wage subsidies or other support.
Available Financing: Financial assistance
For eligibility and financing terms, visit the program website here.
9. FCC Women Entrepreneur Program
By: Government of Canada, Farm Credit Canada
Brief Description: Access to capital and resources to help women start or grow agriculture, agribusiness and food and beverage businesses
Available Financing: Venture capital, line of credit, and more.
For eligibility and financing terms, visit the program website here.
More Start-Up Financing Programs in Canada
Canadian organizations like Futurpreneur, Rise, and BDC are fuelling entrepreneurial passions with their business support tools. Start-up entrepreneurs can make the most out of their resources, mentoring, business advice, access to capital, financing programs, and more!
10. Futurpreneur Canada Start-Up Program
By: Futurpreneur Canada, Business Development Bank of Canada
Brief Description: Futurpreneur is a national, non-profit organization that helps aspiring business owners aged 18-39 with financing, mentoring and expertise.
Available Financing: Collateral-free loan of up to C$20,000 from Futurpreneur + C$40,000 from BDC
For eligibility and financing terms, visit the program website here.
11. Futurpreneur Canada Side Hustle
By: Futurpreneur Canada
Brief Description: Young professionals between 18 to 39 years old with a full-time job can get loan financing and mentoring to launch or grow a side business.
Available Financing: Loan financing of up to C$15,000
For eligibility and financing terms, visit the program website here.
12. Small Business Lending
By: Rise
Brief Description: Aspiring entrepreneurs who have experienced mental health and/or addiction challenges can access low-interest loans.
Available Financing: Up to C$10,000
For eligibility and financing terms, visit the program website here.
13. Futurpreneur Canada Newcomer Program
By: Futurpreneur Canada, Business Development Bank of Canada
Brief Description: Young immigrant entrepreneurs can access loans without having an established credit history.
Available Financing: Up to C$25,500
For eligibility and financing terms, visit the program website here.
BDC Start-Up Financing and Capital for Ontario start-ups
BDC, or Business Development Bank of Canada, supports small and medium-sized businesses in all industries at every stage. They have been working with business owners for 75 years and have tailored financing and capital funds ready to be disbursed to eligible entrepreneurs. Here are some of their financing and funding options for new start-ups or aspiring entrepreneurs in Ontario:
14. BDC Financing – Newcomer Entrepreneur Loan
By: Government of Canada, Business Development Bank of Canada
Brief Description: Immigrants who have moved to Canada can access start-up loans and business advice within three years of the move.
Available Financing: Loan access of up to C$50,000 to grow your company
For eligibility and financing terms, visit the program website here.
15. BDC Financing – Business Transition Loan
By: Government of Canada, Business Development Bank of Canada
Brief Description: Get access to a repayable loan to buy a company, merge or acquire a competitor to expand your operations.
Available Financing: Loan amount based on your needs
For eligibility and financing terms, visit the program website here.
16. BDC Financing – Buying a Business Loan
By: Government of Canada, Business Development Bank of Canada
Brief Description: To acquire an existing business or the business of a competitor or supplier, you can get access to an asset-based loan.
Available Financing: Loan amount based on your needs
For eligibility and financing terms, visit the program website here.
17. BDC Financing – Start-Up
By: Government of Canada, Business Development Bank of Canada
Brief Description: If you’ve been in business for at least a year, you can get loans to help get your business off the ground, finance operations, and replenish working capital.
Available Financing: Up to C$250,000
For eligibility and financing terms, visit the program website here.
18. BDC Financing — Small Business Loan
By: Government of Canada, Business Development Bank of Canada
Brief Description: 15-29-year-olds can access start-up funds, business advice, and mentorship from local business leaders to start a new summer business.
Available Financing: Up to C$3000For eligibility and financing terms, visit the program website here.
19. BDC Capital – Growth & Transition Capital — Buying a business
By: Government of Canada, Business Development Bank of Canada
Brief Description: Access to the repayable financial support of up to $35 million to buy an established business.
Available Financing: Up to C$35Million
For eligibility and financing terms, visit the program website here.
20. BDC Financing – Newcomer Entrepreneur Loan
By: Government of Canada, Business Development Bank of Canada
Brief Description: Immigrants who have moved to Canada can access start-up loans and business advice within three years of the move.
Available Financing: Loan access of up to C$50,000 to grow your company
For eligibility and financing terms, visit the program website here.
Global Innovation Clusters Program
Canada’s Global Innovation Clusters are a new government funding format. This program aims to help strengthen Canada’s most promising economic clusters and accelerate growth in highly innovative industries. If your start-up fits in any of these clusters, you could have access to multi-million dollar grants.
The Global Innovation Clusters program will invest $2 billion in Canada’s five clusters over 10 years, to be matched dollar-for-dollar by industry. The five clusters are:
- Digital Technology (British Columbia)
Augmented reality, cloud computing, and machine learning to improve service delivery in natural resources, precision health, and manufacturing.
- Protein Industries (Prairies)
Use plant genomics and novel processing technology to increase the value of key Canadian crops, such as canola, wheat and pulses, satisfy growing markets for plant-based meat alternatives, and make Canada a leading source of protein.
- Advanced Manufacturing (Ontario)
Build next-generation manufacturing capabilities, incorporating technologies like advanced robotics, 3D printing, training and technology adoption, making “Made in Canada” synonymous with “innovative” and “value-added.”
- Scale AI (Quebec)
Bring retail, manufacturing, transportation, infrastructure, and information and communications technology sectors together to build intelligent supply chains through artificial intelligence and robotics.
- Ocean (Atlantic Canada)
Harness emerging technologies to strengthen Canada’s ocean industries—industries like marine renewable energy, fisheries, aquaculture, oil and gas, defence, shipbuilding, and transportation.
The clusters are led by ISED (Innovation, Science and Economic Development Canada), but each cluster is an independent, not-for-profit entity with its own industry-led board of directors. The cluster is expected to spur collaboration, strengthen competitiveness, and drive innovation and investment in each industry.
If your new start-up is a part of any of these industries or can add value to them, becoming a member could be a significant game-changer. Businesses can come together from across Canada to be eligible for grants under any cluster.
Funding flows into Canada’s clusters through co-investment by the government and industry. Each cluster has its own model for membership and benefit structures. Membership is open to any size of organization – small, medium, large, and even individuals like researchers from any industry to participate in the cluster.
Want to start up in Canada?
The Canadian start-up economy is thriving! As an immigrant entrepreneur, you can access startup loans, financing, tax credits, and so much more. Our Global Entrepreneur Incubation Program is specifically designed to help international entrepreneurs start up and scale to international markets. Reach out to us to book a call.