YOUR COMPANY IS LOOKING FOR BUSINESS FUNDING OPTIONS!
BEST BUSINESS FINANCE & FUNDING OPTIONS
You've arrived at the right address! Welcome to 7 Park Avenue Financial
Financing & Cash flow are the biggest issues facing businesses today
ARE YOU UNAWARE OR DISSATISFIED WITH YOUR CURRENT BUSINESS FINANCING OPTIONS?
CALL NOW - DIRECT LINE - 416 319 5769 - Let's talk or arrange a meeting to discuss your needs
EMAIL - sprokop@7parkavenuefinancial.com
"The best time to secure small business funding is before you need it. The second best time is now." - Attributed to Dileep Rao, Small Business Finance Expert.
SOURCES OF FUNDS FOR BUSINESS IN CANADA / SMALL BUSINESS FUNDING OPTIONS
Business funding options in Canada. And we have to say, this is starting to get embarrassing because suddenly, all the experts seem to agree with what we've been preaching all along.
And to prove it? ... There it was again - a significant article on financing a business just the other day in one of Canada's two best daily business papers entitled :
‘ CANADIAN SMALL BUSINESS FALTERING DUE TO LACK OF FUNDING ' -
Wow, is it just us, or is everyone finally catching on to the world of business banking? The gist of the summarized article is that there are fewer mid-sized companies today.
Competition and the ability to ' access capital ' were driving businesses to failure -
Sources of Cash Are Critical when access to a bank loan and support is unavailable - Knowing your financing options for business growth becomes job 1! Many mid-sized firms are getting smaller, not bigger!
The solution offered in the article is ' MORE RESEARCH’!!!!! - And let's not talk about the challenge of accessing funding sources for startup businesses or where to find sources of cash flow to achieve your business's growth potential.
Breaking Through the Funding Barrier
Finding appropriate funding for your Canadian small business can feel like navigating a complex maze. Limited access to capital continues to stifle growth potential, with rejection rates from traditional lenders remaining frustratingly high.
Let the 7 Park Avenue Financial team show you how today's financing landscape offers more diverse small business funding options than ever, designed to match your specific business needs and circumstances.
BUSINESS OWNERS WANT REAL-WORLD / REALISTIC FUNDING OPTIONS THEY CAN ACCESS IMMEDIATELY
We're all for academia but work in the real world daily. Let's discuss and offer real-world solutions around financing options and a way to get alternative funding sources / private lenders for small businesses on Canadian Business Financing!
We're talking about financing that you can be proud of, with high growth, profits, and costs commensurate with your credit quality and business funding source needs.
FINANCING SOLUTIONS ARE REQUIRED FOR LOANS TO START A BUSINESS, AS WELL AS GROW A BUSINESS
So, how do you access cash flow sources when assessing the need and availability of solutions for different types of business loans and finance methods?
Canadian business owners are looking for straightforward solutions to finding funding for short-term and long-term needs. Those funds can be used to start, fund, or grow their firm.
NO ONE SINGLE BUSINESS FINANCE SOLUTION MAY FIX ALL YOUR FUNDING CHALLENGES
Many funding sources for a business venture are overlooked or not even appropriately utilized. Oh, and by the way, there's probably no perfect solution for financing your firm - it’s a mix of pros and cons and risks based on the amount and type of business funding you're seeking, based on your business capital and working capital needs.
TWO KEY POINTS IN HOW TO GET FUNDING FOR YOUR BUSINESS
Critical to the aspect of sourcing funding for your firm ( that's besides some expert help!) is:
1. Ensuring you understand both warning signs of capital issues in your company
2. Criteria required for the solutions to business credit needs. Those two points can save you a lot of time.
As we have hinted, you will only find solutions to your financing needs when you recognize the proper warning signs and needs. Liquidity is very close to the top of the pile! Your ability to operate daily is key to satisfying senior lenders who have financed your firm.
HERE ARE SOME MAJOR FUNDING OPTIONS TO HELP YOUR BUSINESS SURVIVE AND GROW
In Canada, numerous business finance options are available via small business lending to bolster your firm’s success. They may involve one type of financing or a cobbling together of solutions—in many cases, they are small business financing options that bypass traditional banks.
10 WAYS TO FINANCE A BUSINESS: Additional Sources of Lending for Small and Mid-Sized Loans
A/R Financing Invoice Financing/ Factoring
PURCHASE ORDER FINANCING
Inventory Business Loans
Access to Canadian bank credit/lines of credit/term loans Traditional bank loans and financing offer the best interest rates and are a source of unlimited capital for qualifying companies needing bank loans. A good credit report on the owners is required.
Non-bank asset-based lines of credit: Alternative business funding options for business credit lines
Equipment / fixed asset financing
Cash flow loans
SR&ED Tax Credit Financing / Grant Finance - Small Business Innovation Research
Merchant Cash Advances / Business Credit Card / Online Loans / Business Funding Options - Good owner credit score/personal credit history required - online business funding options have become increasingly popular despite higher costs/interest rates, etc.
These solutions are not traditional loans - the financing formula on this loan option is based on your sales revenues and the credit scores of the business owner; they are easily accessible and provide maximum flexibility for financing up to several hundred thousand dollars.
Royalty finance solutions
Government of Canada Small Business Loan Program—The Guaranteed Federal Business Loan—The government small business loan for small and medium sized businesses is also used for franchise financing requirements.
When sourcing funds to start a business, government business loans are some of the best alternatives available for raising money. Funding options for a start-up are limited, so every solution should be explored to complement your own money in the business.
Typical loan terms are in the 2 two to 5 five-year payback range for amortization. Good credit is required, typically a credit bureau score in the 600+ range.
When looking for funding, it is important to investigate every option for financing your startup without a traditional bank loan, which requires significant guarantees outside collateral, etc.
The CSBF program, as it is called, is a government loan option with participating financial institutions in Canada, such as banks or credit unions.
The loans are term loan structures with longer amortization terms. Significant changes to the program in 2022 significantly increased the amount and type of financing provided under the loan guarantee with flexible monthly payments.
Traditionally, goodwill, working capital, credit lines, and franchise fees were not funded under the program—now they are!! Talk to the 7 Park Avenue Financial team to see if this program suits your business.
The Government of Canada Crown Corporation, aka Business Development Bank of Canada (BDC), is also an option for entrepreneurs seeking sources of finance and government loans.
Those are just some of the most solid and accessible business financing solutions for businesses in Canada.
BORROWER BEWARE!
When considering funding options for small businesses, remember that Venture capital and angel investors focus on equity financing.
This type of financing is available only for the smallest number of qualifying businesses in Canada. As you can imagine, books are written on how to target venture capital firms for business financing.
After you have exhausted your personal investments, such as' love money/friends and family, 'peer-to-peer marketplace lending, Angels, Small business development centers / Business Incubators, convertible debt, and government programs or grants, your focus becomes real-world finance solutions! These are typically not sources of business funding options for a new or early-stage business.
At 7 Park Avenue Financial, we focus on working capital and debt financing and asset-based lending and asset monetization strategies that make sense for funding day-to-day operations and ensuring the ability to grow your business.
START-UP FINANCING FOR STARTUP COMPANIES
Financing to start a business in Canada is very challenging. Along with a solid business plan and financial projections around your project, the ability to source financing is key, as is your personal investment/owner equity.
Entrepreneurs should also be able to demonstrate a good credit history and appropriate business experience. In some cases, additional collateral will also help their situation.
Bank financing is challenging for startups as Canadian banks, as traditional financial institutions, focus on a lending process and requirements that many entrepreneurs can't meet or qualify for.
The focus on track record, cash flows and profits is just some of those bank-type requirements. Banks always want to see a significant shared risk via owner equity contribution.
Many startups rely on so-called' love money ' from friends and family. Although venture capital is often thrown out as a potential funding source, 99% of start-ups in Canada don't qualify for anything remotely resembling venture capital investment.
High-tech businesses are often the most sought-after VC clients as venture capitalists seek hyper-growth situations with high returns to investors.
A closer solution to the VC option is local angel investors with similar industry experiences, solid contacts, and management know-how. The angel investor will always want a board seat or the ability to provide input informally or otherwise.
Many local business incubators, also called business accelerators, provide support for new businesses - that support might be in the form of talent, premises, tech resources, etc Firms typically ' graduate' out of that incubation period as they start to generate revenues.
Case Study
A Vancouver-based manufacturing company with 12 employees faced significant growth constraints despite strong customer demand. Traditional bank financing applications were repeatedly rejected due to limited operating history and collateral.
After consulting with a funding specialist, the company implemented a diversified small business funding strategy combining equipment financing, invoice factoring, and a government-backed working capital loan.
This approach allowed them to:
-
Acquire advanced production equipment, increasing capacity by 240%
-
Eliminate cash flow gaps by converting $175,000 in receivables to immediate capital
-
Hire five additional skilled employees to support expanded operations
-
Secure a $250,000 working capital cushion with favourable terms
CONCLUSION - BEST FUNDING SOURCES TO GROW BUSINESS?
Focusing on the type of business funding you need is all about the type of financing you require and the best source for that business funding, whether traditional or alternative.
Other challenges include under- or overborrowing. Understanding the credit requirements of a traditional financial institution or an alternative lender is key.
At some point, the business owner must decide on funding options and the optimal debt or equity solution. A business plan and solid, conservative cash projections are always a good start.
At 7 Park Avenue Financial, we prepare customized funding requirement business plans at a reasonable cost for financings that require these two items for a bank or financing company.
A focused and realistic business plan for a source of funding is a key requirement for successful funding. Lenders want to see how they will be paid back, and financial statements, cash flow projections, and executive summaries should demonstrate that.
A proper loan package is always key to the best funding option for a business. Funding options for business expansion or scalable business growth must demonstrate repayment from the lender's viewpoint.
Small business owners are always looking for sound advice and solutions. Your ability to manage and finance asset turnover is key to being proud that you have accessed options that make sense for funding the business.
Call 7 Park Avenue Financial, a trusted, credible, experienced Canadian business financing advisor who can assist you with cash flow sources, business funding options, and the best small business funding sources.
Let our team show you how to finance your business needs best and grow sales of your products or services with all available solutions, including the benefits of alternative lending.
We'll work with you to identify the right financial solution for your business's success and the right source of business financing to achieve your growth potential goals.
FAQ: FREQUENTLY ASKED QUESTIONS / PEOPLE ALSO ASK / MORE INFORMATION
What are the three main types of financing for businesses?
The three types of finance solutions available to small business owners include debt financing via traditional or alternative loans, equity financing via personal investment of the owners, or combinations of the two that might consist of alternative non-bank finance solutions or government-guaranteed small business loans for business loan applicants. Venture capital funding & venture funds are appropriate for raising capital for some high-growth companies, but not all businesses. Government grants may be applicable for some projects.
Do banks give loans to start a business?
For starting a business via a bank loan, traditional bank lending requires evidence of cash flow to support payment, which is often a challenge if personal assets and savings cannot be collateralized. Other sources of financing are frequently explored, including alternative lending, business credit cards, and home equity lines of credit.
What role do small business funding options play in managing seasonal cash flow challenges?
Specialized funding solutions directly address seasonal revenue fluctuations through flexible repayment structures. Options like business lines of credit provide on-demand capital during low seasons without forcing unnecessary borrowing during peak periods. Additionally, invoice factoring and merchant cash advances adjust payment schedules proportionally to incoming revenue, adapting automatically to seasonal patterns.
Why do alternative small business funding options charge higher rates than traditional loans?
Alternative funding sources charge premium rates because:
- They accept higher-risk profiles traditional lenders reject
- Many don't require collateral or personal guarantees
- The approval process is typically faster and less rigorous
- They often base decisions on future potential rather than past performance
- Operational costs for specialized lending are higher
- Risk pricing reflects actual default rates in underserved segments
What are Business Grants, and are they appropriate for my business
Grants are lump sums of funds for businesses that are usually at the federal, provincial, or, in some cases, local level of the company. A grant, of course, does not require repayment ! .. That, though, comes with the challenge of accessing small business grants and determining your qualifications.
Business owners and entrepreneurs need to understand the criteria for any specific grant they feel they might qualify for. Government of Canada websites do a good job of itemizing grant programs and identifying qualifications,
It's important to remember that due to limited funds, there is often a lot of competition for grant money. It's typical for a grant to be a matching funds program, which requires your business to assume a portion of the cost of your project. The good news is that grant financing is available to accelerate that funding. Talk to the 7 Park Avenue Financial team about grant finance solutions based on matching funds criteria.
When applying for grants, one option is to hire a grant writer who has experience clarifying your project, its benefits, and key background on yourself and your business. Grant providers are looking for significant projects and your level of expertise in the specific area.
Grant applicants should be aware of the amount of funds that need to be matched and the need for strong proposals relevant to the grant. Nonetheless, grants and grant financing are solid ways to access an alternative source of capital if you can meet the prerequisites.
Citations on Small Business Funding Options
- Business Development Bank of Canada (BDC). (2023). "Canadian Small Business Financing Landscape Report." BDC Research Department.
- Industry Canada. (2024). "Small Business Access to Financing: Annual Report on Government Programs." Government of Canada Publications.
- Deloitte. (2023). "Alternative Lending Landscape in Canada: Market Analysis and Trends." Deloitte Financial Services Research.
- Statistics Canada. (2024). "Survey on Financing and Growth of Small and Medium Enterprises." Government of Canada.
- Canadian Federation of Independent Business. (2024). "Banking on Entrepreneurship: Small Business Financing Challenges and Opportunities." CFIB Research Foundation.
See
- Business Development Bank of Canada (BDC): https://www.bdc.ca
- Industry Canada: https://www.ic.gc.ca
- Deloitte Canada: https://www2.deloitte.com/ca/
- Statistics Canada: https://www.statcan.gc.ca
- Canadian Federation of Independent Business: https://www.cfib-fcei.ca
