Canadian businesses who need funding may balk at the traditional route that involves giving up equity ownership of their company. Perhaps the most common example is when shares are sold in an effort to raise the money needed to expand or scale up the business. Non-dilutive financing provides you with an alternative.
1. Non-dilutive financing lets you keep ownership
Non-dilutive financing, however, offers you a way to gain access to money without giving up control of your business. After all, it’s your business and you want to be able to run it the way you feel that works best. Having to answer to investors could lead to unforeseeable issues in the future.
2. Non-dilutive financing can increase your company’s value
While many companies turn to dilutive financing first, doing so can tap into the equity of the business. Using non-dilutive financing as a first option could mean that the valuation of the shares increases, providing more options for financing in the future.
3. Non-dilutive financing comes in many forms
If you’re like many business owners, loans come to mind as the most common non-dilutive financing option. Whether it’s a loan from a friend or from a financial institution, there are other options available that don’t have to be paid back. Government grants are another source of funding that many businesses fail to explore as fully as they should.
4. SR&ED refunds can be turned into non-dilutive financing
Canada offers a generous government program that is known as the Scientific Research and Experimental Development Tax Incentive Program. Often shortened to SR&ED, this incentive targets Canadian businesses that perform research and development by offering tax credits and refunds based on the amount spent.
5. Getting non-dilutive financing doesn’t have to be difficult
When it comes to tapping into government programs like SR&ED, many Canadian businesses think that the time and effort it takes to do so simply isn’t worth it. This means that you could be leaving thousands of dollars worth of free funding on the table. Partnering with a company that has experience with securing SR&ED funds allows you to concentrate on your business while reaping the benefits of extra money when you need it. It’s a winning solution for infusing cash into your business for expansion and other needs.
Contact Easly if you have questions about non-dilutive financing or getting an SR&ED-based loan.