bizunplugged
Financing Canadian Startups
Filed in archive Startup by Greg Balanko-Dickson on July 28, 2006
Financing Canadian Startups
Solo-entrepreneurs often get started with $5,000 of self-funding and never employ anyone other than themselves. Whereas, many of the startups I see typically use an average of $50,000-$250,000 to start their business. The majority self fund from savings, corporate assets, or self-directed RRSP's and the remaining will use Banks and other financial institutions.

For example, research shows that 49% of the small- and medium-sized businesses in Canada rely on banks and other financial institutions to provide them with business debt financing (whether for start-up, expansion or ongoing funding). Other sources of financing include:
  • retained earnings (31%)

  • supplier credit (39%)

  • personal savings (35%)

  • personal lines of credit (37%)

  • personal credit cards (33%)

  • leasing (16%)

  • personal loans (14%)

  • business credit cards (26%)

  • government lending agencies/grants (7%)

  • loans from employees, friends and relatives (10%)

  • non-related private loans (5%)

  • public equity (2%)

  • venture capital (2%)*

  • * Angel Investment = 4% according to Statistics Canada Survey 2000. Venture Capital = 1% according to Statistics Canada, Survey of Suppliers of business financing, 2002.


Source: Statistics Canada, Survey of Financing of Small- and Medium-Sized Businesses, 2002.

Permalink: Financing Canadian Startups
Tags: financing  startups  Canadian  business  canadian  canadian+startups  financing+canadian  small+business 
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