How Business Grants Work: 4 Main Types of Business Grants
Why do governments, corporations, and non-profits have grant programs for entrepreneurs?
In other words, granting organizations have a goal in mind when they set up a grant program.
Grant programs can be grouped into the following categories:
In the following sections we describe each category:
ACTIVITY GRANTS
Activity grants do exactly as they say: they fund specific business activities.
The goals of activity-oriented business grants are to:
Let’s briefly cover the business activities that grant organizations typically support:

Hiring
Hiring: These grants are meant to encourage businesses to create new jobs or retain existing ones. This is done to increase employment opportunities for specific demographic groups (e.g., students, recent graduates, underserved communities), regions (such as rural areas), industries (e.g., cleantech), and activities (e.g., technology adoption).
Hiring grants can cover up to 80% of a new employee’s wages for a specific amount of time.
Training
Training: Grants for training are given to businesses to help them develop the skills and knowledge of their employees. This helps businesses to remain competitive and adapt to new technologies and changing market conditions.
Training grants typically cover 50% – 75% of training costs, but some grant programs cover fully 100% of training costs.
Research & Development
Research & Development: Grants for R&D are provided to businesses to support the development of new products, services, and technologies. This helps businesses to remain innovative and competitive in their respective industries.
Business Expansion
Business Expansion: Grants for business expansion are given to businesses to support their growth and expansion. These programs typically target specific types of activities to grow a business:
Equipment purchase
Equipment purchase (or lease) grants help businesses acquire the necessary tools and machinery to improve their operations and productivity, including the purchase or lease of new or used equipment, as well as upgrades to existing equipment
Technology adoption
Technology adoption grants allow businesses to purchase new technologies and digital solutions to improve their operations and competitiveness. Grants may cover the purchase of software and/or hardware.
Energy efficiency
Energy efficiency upgrades. Grants for energy efficiency upgrades help businesses reduce their energy costs, improve their environmental footprint, and stay competitive in a changing marketplace.
AUDIENCE GRANTS
Some grant organizations provide grants to support specific demographic groups. The main goals of audience-oriented business grants are to:
The groups that get the most grants include the following:

Artist entrepreneurs
Artist entrepreneurs: Grant organizations provide business grants to artist entrepreneurs to support the growth of the creative industry, which is an important sector of the Canadian economy. These grants are intended to help artists develop their skills, create new works, and promote their art to a wider audience.
Indigenous peoples
Indigenous peoples: Grants are provided to Indigenous peoples to support economic development in Indigenous communities. These grants are intended to help Indigenous peoples start or grow their own businesses, create jobs, and promote economic self-sufficiency.
Young entrepreneurs
Young entrepreneurs. Starting a business is challenging, and it can be even more challenging for young entrepreneurs who may have limited access to capital and business networks. Grants for young entrepreneurs can provide them with the support they need to develop their businesses and become successful entrepreneurs.
Student entrepreneurs
Student entrepreneurs. Like young entrepreneurs, student entrepreneurs face unique challenges in starting a business, including balancing their studies with their entrepreneurial pursuits. Grants for student entrepreneurs can provide them with financial resources and support to help them develop their businesses while still pursuing their education.
Women
Women: Grants for women are provided to address the gender gap in entrepreneurship and to support women-owned businesses. Women entrepreneurs face unique challenges such as limited access to capital, networks, and resources. These programs aim to provide women with the financial resources, mentorship, and training they need to start and grow their businesses.
INDUSTRY GRANTS
These grants are intended to help businesses in specific industries expand their operations and create jobs, which in turn benefits the overall economy.
Some busines grants support specific industries. Here are the most popular:

Agriculture/farming
Agriculture/farming. Agriculture and farming are important sectors in Canada, and funding organizations provide grants to support the growth and sustainability of these industries. Grants are often used to fund research and development, improve infrastructure, and promote environmentally sustainable practices.
Arts/media/entertainment
Arts/media/entertainment. Funders recognize the value of arts, media, and entertainment in promoting culture and diversity, and in creating jobs and economic growth. Grants are often used to support artists, cultural organizations, and festivals, and to promote Canadian content and talent.
Construction/Real Estate
Construction/Real Estate. Grants are typically given to construction and real estate companies to support the development of affordable housing projects, to support sustainable building practices and reducing environmental impact, and to conduct research and development projects related to their industry.
Manufacturing
Manufacturing. Manufacturing is a large part of the Canadian economy, and both the federal and provincial governments provide grants to support innovation, productivity, and competitiveness. Grants are often used to fund research and development, upgrade equipment and facilities, and promote exports.
Technology
Technology. Funding organizations recognize the importance of technology in driving innovation and economic growth. Grants are often used to support research and development, commercialization of new technologies, and to promote entrepreneurship and start-ups.
REGIONAL GRANTS
While most grant programs are either Canada-wide or province-wide, there are some regions in Ontario that have special programs set aside for businesses with operations in the region.
The goals of regional grants are to:
Northern Ontario is the region that has the most grants and other funding programs dedicated specifically to the region.
There are also specific government agencies and centres responsible for supporting Northern Ontario development:
If you live in a city in Ontario, these are the best organizations to ask about business funding:
If you live in a rural area of Ontario, the best organizations to ask about business funding are CFDCs (Community Futures Development Corporations), which offer loans, loan guarantees, contributions, grants, equity investments and in-kind support.