How Early Stage SMEs Can Qualify for Investing in Business Innovation (IBI)
In the winter of 2013, FedDev Ontario announced the launch of the Investing in Business Innovation. The goal of the program is to assist early-stage businesses in addressing challenges to growth and product commercialization. Funding from IBI is dispersed as a 0% interest loan and supports projects up to two years in length. Projects should be aimed at early-stage product or process commercialization, business development, late-stage product development, and marketing or distribution strategy.
Investing in Business Innovation for Early Stage Businesses: Company Eligibility
IBI is specifically for early stage businesses that have been incorporated for less than three years and headquartered in Southern Ontario. Companies must have less than 50 full-time employees. Applicable business also needs to have two-thirds of the project costs covered with committed investments. As this is an early-stage business focused program, business can be pre-revenue but must demonstrate cash flows to support the project for two years post-completion.
IBI Canadian Small Business Grants: Funding Details
Companies can apply for up to $1 million in funding to cover 33% of eligible non-capital costs. Companies can receive up to 25% for capital equipment costs. In-kind contributions are ineligible for this Ontario government funding program.
IBI Canadian Grants for Small Business: Eligible Projects
Investing in Business Innovation funding is provided for the following:
- Early-Stage Commercialization of innovative and unique products and processes
- Business Development of early-stage businesses, including building high-performance teams, adopting best management practices, processes, and systems, and improving governance and investment readiness
- Late-Stage Product Development geared towards market diversification and growth or customer and market development
- Developing and Implementing Marketing and Distribution Strategies
Costs Eligible for Funding through Small Business Grants Canada
The following costs are considered eligible for Investing in Business Innovation:
- 33% of direct project labour costs
- 33% of consulting and contractor costs
- 25% of capital costs directly related to the project
- 33% of non-capital costs directly related to the project
Please Note: In-kind funding is ineligible for this Ontario government funding program, however applicants can stack their funding up to 75% with other government funding sources.
The Investing in Business Innovation for Early Stage Small Businesses: Application Details
Applications for Investing in Business Innovation are accepted on an on-going basis, however projects must be completed by the end of the 5-year program in 2018. Once an application is submitted, it takes approximately 90 days for FedDev Ontario to assess the application and provide a consensus. Applicants should outline a project that is approximately 18 to 24 months in length for this program. Successful IBI businesses are reimbursed for their expenses upon submission of invoices to FedDev Ontario, who requires a minimum of two expense submissions per year and a maximum of one per month. Companies will need to submit periodic progress reports demonstrating the project’s progress to-date. The scope of the project can be re-evaluated based on performance.
Attend a Free Canadian Government Funding for Small Business Workshop or Webinar
Mentor Works offers free workshops and webinars for owners and leaders of established small to medium-sized businesses. Visit our Mentor Works Events Page to register for an upcoming workshop or webinar today.