Small Business Funding for Women

By Office Space TorontoIn standard25th May, 2015

funding-for-women-entrepreneursWhen starting a new small business finding and acquiring funding can be one of the toughest challenges. One of the obstacles women entrepreneurs face is their access to financing. Sometimes it can be harder for women entrepreneurs to get funding than it is for their male counterparts, but then there are alternative funding sources that many women entrepreneurs may not know about that are geared to helping women get their business off the ground.

WWW.canadabusiness.ca lists a number of government and private-sector sources of funding in Canada, including specific ones aimed at helping women finance their business. Some of the funding help is only available in specific provinces.

Alberta Women Entrepreneurs, as part of the Western Economic Diversification Canada program, offer women services to start, grow and give advice to their small business. Besides offering small business loans for up to $150,000, they also offer training, workshops and conferences. Another way that women can benefit from Alberta Women Entrepreneurs is through networking opportunities and mentorship through their Exelerator program.

Women’s Enterprise Centre’s Business Loans Program offers small business loans to women-owned businesses in British Colombia that can help then start, enhance or grow their BC business. The program offers loans up to $150,000 for women-owned businesses in BC. One of the great features of the Women’s Enterprise Loans Program is that it is bundled with free, ongoing, professional business advice. Another great feature is that they have lower fees and competitive interest rates as well as lower  requirements for security and equity than most other lending programs.

Through the Micro-lending for Women in Ontario program, woman entrepreneur in certain regions of Ontario, may be able to apply to a local program provider offering business training and micro-loans. Business start-up loans can range from $5,000 up to $15,000. The program supports low-income women who are seeking to start their own business by providing financial literacy training, entrepreneurial mentoring and skills development, and life skills support. These skills will ensure women’s success in starting and growing their businesses.

Micro-lending programs provide small loans to individuals to support personal entrepreneurship. Recipients of micro-loans are traditionally low-income individuals who lack the credit history, steady employment or the collateral necessary to obtain conventional forms of credit. Micro-lending programs are most successful when they provide or ensure that loan recipients also receive other required supports – such as financial literacy education, business development training, mentorship and access to childcare.

Women’s Enterprise Centre (Manitoba), as part of the Western Economic Diversification Canada Program, offers skills programs and loans of up to $150,000 to start, expand or to purchase an existing business. The business also gets advisory services as well as business and marketing training. The key requirements are a viable business plan and that the business must be at least 50% owned or controlled by a woman.

Women Entrepreneurs of Saskatchewan Inc., as part of the Western Economic Diversification Canada Program, offers skills programs and loans of up to $150,000 to women who are living in Saskatchewan and thinking of starting a business, purchasing a business or operating an existing business. Just like other similar programs funded by Western Economic Diversification Canada, participants are offered business development seminars and advisory services, as well as mentoring and networking opportunities. To qualify for this program the recipient must operate a business in Saskatchewan that is at least 51% owned or controlled by a woman.

In the USA, there are programs through the SBA (Small Business Administration). The Office of Women’s Business Ownership’s mission is to establish and oversee a network of Women’s Business Centers (WBCs) throughout the United States and its territories. SBA also offers a variety of loan programs for very specific purposes – from small business loans to micro loans.

Outside of government-run programs, there are also other sources of funding and resources for women entrepreneurs. Banks are also working more with women entrepreneurs. The Royal Bank of Canada has specifically developed advice and services that are geared to meet the needs of women entrepreneurs. Not only is small business financing available through the bank, its goal is to offer additional resources and expertise for women.

More and more women entrepreneurs are looking away from the big banks and are instead working with credit unions, simply because credit unions are member-focused rather than profit-focused. These cooperatives are owned and controlled by its members, as opposed to being stockholders. Once a small business is granted membership to the credit union and an initial deposit has been made,that small business owner is a part owner. That entitles them to vote on how the credit union is run.

More and more women start-ups are looking to an angel investor or angels (aka business angels or informal investors) that are affluent individuals or groups who provides capital for a business start-up, usually in exchange for convertible debt or ownership equity. There are also angel investor groups that are made of women.  37Angels, Golden Seeds and Pipeline Fellowship are some of the angel investment groups that Forbes.com mentions as the new wave of angel investors that are for women and by women.

There are other sources of private-sector financing to consider – including merchant bankers, international trade financing companies, and specialized financial institutions. Some women entrepreneurs and small business owners are getting funding for their accounts receivables. Accounting software companies like Intuit (makers of Quicken and Quickbooks) have other separate companies that offer loans and receivables funding.