Canada’s technology startup ecosystem has changed dramatically over the past ten years and gaining an international reputation as a world-class technology hub. As a result, there is an increase in funding available for startups at all growth stages. While searching for startup funding options, there are many important factors that entrepreneurs must consider such as current growth stage and long-term vision.
There are generally two types of startup funding options: non-dilutive and venture capital. Non-dilutive funding is capital that does not require owners to give up a percentage of their company in return for financing. The primary non-dilutive funding sources are grants, subsidies and loans. Grants and subsidies do not have to be paid back. Loans are repayable, and interest rates can vary from 3-8%+ depending on the lending institution. Non-dilutive funding is a good fit for early-stage startups looking for capital to help with MVP research and development costs.
Venture capital funding (VC) is money provided by an investment firm in exchange for a limited partnership in the company. On average, investor equity ownership can range anywhere from 10-80%. It is based on factors such as the funding amount provided and projected investment returns. VCs are generally not interested in the day-to-day operations of the company, but may ask for a seat on the board of directors. VC funding is sought when companies are ready to expand into different markets or diversify product lines. Entrepreneurs will need to present pitch decks, business plans and budgets to potential VCs.
Angel investors are also an option and behave similarly to venture capital firms. An angel investor is an individual person looking to invest in viable companies rather than as part of an investment group. Capital is generally provided in exchange for equity ownership in a company. However, angel investors often prefer a more active role in the day-to-day operations of the business in comparison to VCs.
At StableHacks, we can help you jumpstart your business with ease. We will provide you with up to $25,000 of non-dilutive funds to help you launch your business after running an eligibility check to make sure you are qualified to receive the funds. You simply have to be a registered for-profit company in Canada. That’s it! StableHacks core mission is to help local businesses succeed and want you to retain 100% ownership of your company.
So what are you waiting for? Contact us to learn more!