Business Owners and Government Funding Confusion
Just about a thousand times a week we here at CanadaStartup get emails, phone calls or text messages from readers like you (small business owners, entrepreneurs, business individuals). Those who always seem to say the exact same thing about government and funding.
I called the government for funding and they said…
We don’t have any funding…
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There is no government funding…
Government funding doesn’t exist…
We don’t fund that kind of business…
So at that time, these same readers come back to us and say what is going on here. You guys (CanadaStartups) are lying to us about government funding, about the availability of funding, you are nothing but liars.
On the other hand, we have hundreds of other messages, calls and members contacting us daily, leaving their positive reviews, sharing their success stories, sending us pictures of them with government cheques, funding approval letters and telling us how without our platform and our funding database they would be lost.
A Funding Reality Check
We had a chance to sit down with a group of small business owners (who tried to get funding and failed), and also a group of entrepreneurs (who were thinking of searching for funding). This group represents 120 unique individuals across the country who were willing to participate and who all said, “I called the government for funding.”
As you may know, a major component of our Small Business Startup Portal is the Funding Database, in which we provide our members with access to every single government funding program available. This means all available funding programs offered by the Canadian government are researched, compiled and listed by our in-house team into our funding database. The criteria is clearly listed, the qualifications, benefits and contact details for each program are noted, along with deadlines and potential funding amounts.
Why Do We Do This?
We do this so that we can help small business owners across the country locate funding for their small businesses. Not because the government does a bad job at promoting its funding programs, but because the government is not just one government and there is a massive amount of data. We try to help by putting it all into one place, along with many other tools and resources.
The Funding Search Test
So back to our group and what we called a true funding search test.
We asked every single business owner to write out their experiences of dealing with the government and how they heard a firm no, funding does not exist. Once this was done, we put it together and tallied it all up. Here are the results of those findings.
- 68 unique individuals said: Government said no funding exists
- 32 unique individuals said: There isn’t funding for that
- 12 unique individuals said: Government told me to go to the bank
- 8 unique individuals said: They couldn’t figure it out
Pretty interesting findings. It seems like there really is no funding available from the government.
Right?
Wrong
Unless hundreds of government agencies across the country and over 900 individual funding programs are just made up by the individual governments.
The next step was to turn to our own in-house funding database to do a search for each individual in our group. Based on our preliminary search, out of the 120 people, all 120 seemed to be able to find at least one funding program which may be available for them.
This did not mean that they qualify for the funding, nor that they will get it. It simply means that the program, based on the initial criteria, seemed to be right for them. The basic criteria reviewed included location of the business, the industry and funding needs.
One thing to keep in mind is that funding searches depend on a number of factors, as each funding agency and funding program is different. All of these factors and more have to be considered.
Common Funding Factors
- Location of the business
- Business industry
- Funding needs
- How much funding
- Your investment
- Business plan
- Credit score
- Time of year you apply
- And more
Our group of 120 was shocked and in disbelief to find that they all could potentially qualify for some sort of funding. We decided to take it to the next level.
A Live Government Call Test
We took a random individual from within the group, from Ontario, who needed funding to help him hire employees, purchase tools and equipment and improve cash flow. Without telling him much, we asked him to do exactly what he did previously when he called the government.
This was done live.
As expected, this individual called Service Ontario and spoke to Service Person 1, who transferred him to Service Person 2, then to Service Person 3 and then to Service Person 4. After 30 minutes of trying to explain, “I need funding for my business, who do I need to speak with,” a manager finally came on the phone and said there is no funding available to start a business in Ontario. After suggesting he go to a bank for a loan, the call ended.
So What Happened?
The government said no funding exists.
At this point, our group of business owners realized what the problem was.
- Why did we call Service Ontario?
- Why did we not explain what we needed funding for instead of only saying business funding?
- How knowledgeable was that service manager?
It was easier to understand these issues after going through our funding database and knowing what actually exists.
Basically, the business owner called the one government agency he knew about. In this case, Service Ontario.
The problem is that there are many different government agencies, departments and programs. A single person would not know exactly where to go unless they had spent a lot of time trying to figure it out, like we have with a full-time team.
You can call your local government, your provincial government or the federal government for business funding. But how do you know who to call and for what?
You may get lucky and call a funding agency in your city, but it is possible that the agency you contact only provides funding for certain industries.
Access to the Right Tools
We gave our group access to our funding database and tools and sent them home with a plan to contact the appropriate funding agencies and request funding based on their needs.
Within a few weeks of the initial meeting, we started hearing back from the group. Some individuals were successful at obtaining funding, others were waiting for a government response, some were denied and some could not find programs for their specific needs. However, everyone had the opportunity to speak directly with a funding agency or advisor.
What Does All of This Mean?
It is simple. If you are looking for funding, be sure you are asking the right questions, of the right agency and for the right purpose. Keep in mind that not every agency knows about every other agency. Break your funding search down carefully. Search for funding specific to your location, your specific funding need and your industry. Your odds will greatly increase.