Business Development Bank of Canada (BDC) Growth & Transition Capital
Description:
The Growth & Transition Capital provides a full range of financing options such as mezzanine, cash flow and quasi-equity financing, all designed to keep vital cash flow in their client’s rapidly-growing company, without diluting ownership.
Their Growth & Transition Capital team offers financing solutions on flexible terms to both mid-market and high-revenue Canadian companies. These solutions allow businesses to raise capital when they have insufficient tangible assets to pledge for security and don’t want to dilute ownership.
Comments on Funding:
Funding ranges from $250,000 to $35M.
Funding terms and conditions:
- Security is subordinated to secured lenders.
- Limits dilution of ownership and offers an affordable alternative to equity financing. In most cases, BDC will require no shareholder agreement, management rights and no board of directors representative; this ensures that your business stays in your hands.
- Personal assets are not taken as collateral.
- There are customized financing solutions:
a) mezzanine financing customized to applicant’s needs: It is a hybrid of debt and equity financing—similar to debt financing because you need cash flow to repay the loan but the terms of repayment are more flexible than conventional financing. It’s also associated with equity financing because BDC can participate in your company’s growth and seek a variable return on its investment.
b) cash flow financing for growth projects: This financing is designed for companies that have a consistent track record of positive and strong cash flow and want to plan large-scale projects with the cash they need in hand.
c) quasi-equity financing to share the risk with BDC: BDC shares the risks with businesses that are in the commercialization phase and have not yet reached positive cash flow but forecast that they will generate strong cash flow in the near term. This solution allows you to raise capital and repay your loan at the end of the term in order to keep cash in your business for daily operations.
d) Monthly Recurring Revenue solution: A one-of-a-kind solution for unique businesses: This solution is designed specifically for sticky, high margin, subscription revenue companies such as SaaS (Software as a Service) businesses. BDC offers growing companies the opportunity to invest in sales and marketing to acquire more customers and generate further growth.
e) unitranche financing: A one-stop solution to simplify transactions: Unitranche financing is an attractive solution for acquisition or change of ownership transactions over $5 million. BDC offers unitranche loans to simplify and speed up the process by combining senior term debt and subordinated debt into a one-stop solution.
Eligibility:
Applicants must:
Program Contact:
When It Ends:
Ongoing
Deadline:
Rolling deadline