Financing equivalent to SBA in Canada

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August 23, 2024

by a searcher from McGill University in Montreal, QC, Canada

Hi,

I'm looking to purchase an MSP/technology business in Canada. I was wondering if there is a financing option similar to the SBA loans available in the U.S. that I can explore. What kind of down payment would be required in Canada, is something in the 10% range feasible?

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Reply by a searcher
from Grenoble Ecole de Management in Vancouver, BC, Canada
I've seen discussion papers offering as much as 85% LTV - however, I wouldn't suggest that much leverage for the majority of deals I come across. This would also be subject to credit approval, which requires support from your personal balance sheet.

As mentioned above, BDC can be a good partner to help you structure mezzanine financing for the right deal. Generally also helps to have the seller's confidence by way of some form of deferred payment (i.e., rollover, earnout, promissory note, etc.).
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Reply by a searcher
from HEC Montréal in Montréal, QC, Canada
Nothing like SBA here. If you acquire in Quebec, Desjardins or BNC (can't remember) had a program to increase your down payment but the amount were quite small. Only thing I can think of that can help you financially is this program that covers a portion of the due dill costs: https://ctequebec.com/acces-experts/
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