Business Development Bank of Canada outlines 8 startup funding sources

The Business Development Bank of Canada (BDC) has published a guide outlining eight potential funding sources for entrepreneurs starting a new business. The bank highlights that combining various funding streams can strengthen a company's financial standing and demonstrate commitment.

Personal investment is identified as the primary funding source for many startups. This method avoids lengthy loan applications or the need to solicit external investors, allowing founders to retain full control. Financial institutions often expect entrepreneurs to invest their own capital as a sign of long-term commitment.

A second source discussed is funding from friends and family. While this can be a quicker way to secure initial capital, BDC notes that such arrangements come with specific considerations and potential risks that should be carefully managed.

The guide encourages new business owners to explore a diverse range of options, including bank loans, government grants, angel investors, and venture capital. By strategically blending these sources, businesses can build a solid financial foundation and enhance their credibility with lenders and investors.