FedDev steps up with $190MM for S. Ontario

Photo by anitakhart

The Federal Economic Development Agency for Southern Ontario announced a new Investing in Business Innovation program. The program offers matching for early-stage venture funding. This is a $190MM running from 2010-2014.

There are provisions for startups and angel networks. Since we’re StartupNorth, let’s try to deal with the startup side first.

Startups who receive a termsheet from a qualified angel investor (as defined by the Ontario Securities Commission) or venture capital firm (registered with the Canadian Venture Capital association) are eligible to apply for up $1MM in loan from the federal government.
Restrictions:
- Start-up businesses will be eligible for repayable contributions up to $1 million for no more than one third (33? percent) of total eligible and supported project costs.
- An angel and/or venture capital investor(s) must be committed to provide at least two thirds (66? percent) of the cash contribution toward eligible and supported project costs.
- In-kind contributions related to mentoring, networking, and other business skills cannot be considered as part of the angel or venture capital investor’s cash contribution.
- A maximum of one project per eligible start-up SME can be funded under the initiative.
- Direct eligible costs for start-up businesses may include:
  - Labour, capital and operating expenditures;
  - Materials and supplies;
  - Consulting and/or professional fees (limited to market rate); and,
  - Minor and non-capital acquisitions (e.g., software).
- All project activities must be completed by March 31, 2014;

Basically there is federal government matching loans up to $1MM for startups that are raising angel or venture funding in Southern Ontario. This is a fantastic start.

It’s great for startups in Southern Ontario, it’s curious that the program is only available in Southern Ontario. Why not all of Canada? How are the repayment terms set? Is this a zero percent interest loan from the Federal Government? Does the term sheet have to be equity investment? Is convertible debt eligible? How do startups “demonstrate they are using business mentoring, counseling, or related services”?

How to prepare for a C100 Mentoring session

We gearing up for the next 48 Hrs in the Valley here at C100 global HQ. We’ve learned a lot from previous 48 Hrs events so expect a few surprises, to be announced soon.

But in the meantime, a few dates for you to be aware of:

Sept 29: Drop dead deadline for companies to complete the application form
Oct 7: Selected companies will be notified
Oct 13: First draft of mentor deck due
Oct 27-28: 48 Hrs in the Valley

I know what you’re saying, “What the heck is this Oct 13 deadline? We gotta hand in drafts of our presentations??”

Short answer: “Yes!”

The upcoming 48 Hrs will be the C100’s eighth mentoring event and after each one the mentors always told us the same thing, “We wish the companies were more prepared.”

That is a strange coincidence, because the companies always tell us, “Damn, I wish we were more prepared.”

Well, the good thing about the C100 mentoring team is you only have to tell us something seven times before we start to take immediate action.

To make sure everyone feels they are properly prepared, we are asking… nay, demanding… that all companies complete their mentor decks and submit to us by Oct 8 for feedback by our crack team of mentor experts.

To help you out, here are some useful tips on how to prepare you 48 Hrs mentor deck:

Think of the biggest challenge facing your company and talk about it. What exactly do you want to get mentoring on? (In C100, we call this the “challenge statement” meaning, what is the biggest challenge facing your company right now)
Don’t get bogged down in technology: Mentors want to talk about business issues, not about speeds-and-feeds
Don’t talk history: Mentors want to discuss the here and now, the long road you took to reach your current destination probably isn’t relevant
Be specific: generic presentations get generic feedback. Drill down into one aspect of your business, describe what is going on, and ask for specific advice and feedback

Here is a deck template all companies should follow. Your deck shouldn’t be more than nine slides long:

1) Executive Summary: Short bullet points what your company does and what is your “challenge statement”

2) The Market: Give mentors background on the market your company addresses

3) What do you do?: How do you address your chosen market

4) Who are your competitors?

5) Short background on the team (emphasis on short)

6) Financial snapshot including funding, revenues and expenses

7) Challenge statement: This is the most important slide of the deck… what issue do you want mentoring on? Be very clear and specific here

8) Context: How did this challenge come about? How have you addressed similar challenges in the past

9) Importance: Why is addressing this challenge important? What would happen if this challenge was addressed? What would happen if it wasn’t?

Trust us, follow this template and your mentoring session will be way more valuable than if you didn’t.

The goal is always to make the mentoring sessions as useful and impactful as possible. So we at C100 will be asking the companies early and often to provide drafts of their decks so we can help ensure they are prepared for the mentoring session and ready to go.

Going global from day one

Arguably, two of the most important centers of innovation outside of Silicon Valley are in India and Israel. The reasons of why this is are numerous and could form basis of someone’s PhD thesis but for the purpose of brevity I’ll only highlight one: global from day one.

You talk to entrepreneurs from either India or Israel and they’ll surely weave great yarns about their companies (these are also two great storytelling cultures) but one thread that will be consistent is when the entrepreneur founded their company, they were immediately thinking of the global marketplace.

In Israel, it is because the domestic market is too small and there are limited opportunities to sell regionally. The story in India is that while population is huge, it is very poor so the actual local market for technology or technology services.

Faced with these challenges, Indian and Israeli companies would market to the US and Europe and often place key personnel in those geographies. Overseas became their across the street.

In the past year, Canada has been thrust upon the global stage several times. Whether it is praise for our banking system, our brave forces, our Gold-medaled athletes, or our ability to throw a party, Canada as a country has been seen as a global leader.

Will our entrepreneurs follow suit? Sometimes it seems that cross-cultural expansion from a Canadian perspective is an Alberta company selling into Quebec.

Unfortunately, as often as you hear of grand global ambitions from Israeli, Indian (and American!) entrepreneurs, you hear of relatively modest ambitions from Canadian ones.

All too often global expansion = US expansion. That is not the right formula.

Here’s a fact that is sometimes a bit uncomfortable, many American companies consider Canada as part of their domestic market. The effort and planning these companies put into Canada is the same one they put into Wyoming. (OK, maybe I’m overstating the point)

But here’s a suggestion, we should return the favor. Canadian companies shouldn’t think of the US as a “global” market but rather just an extension of the domestic one. When Canadian companies say global, they should mean it and have Asia, Latin America, the Middle East and Africa dead in their sights. These regions all have burgeoning and tech-savvy populations and are eager to get online.

So whether we’re talking about consumer, enterprise, SMB or SP services or products, let’s see Canadian entrepreneurs putting the “world” into their WorldWideWeb plans. Canada’s got the world stage for the moment. Entrepreneurs, make your entrance.