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Too much government.

August 11, 2009

Did you know that the federal government gives grants and low/no cost loans so that businesses can market themselves?  They do.

A lawyer got one.  Bad Ass Jack’s got one.  A beauty shop got one.

You can get them for other purposes as well.  Some companies even double dip.

Sweet Grass Records got three — to establish a business, to market the business, and to market the business on the internet.

The Small Business Finance Centre makes accessing all of this easy and they have helpful advice.

When you receive this money, you don’t have to pay it back. It’s yours to use under the terms of the grant. The federal and provincial governments know that it’s tough for small businesses like yours to bring new products to market, make your company more efficient, or hire employees. So they provide billions of dollars a year to aid Canadian product innovation and grow small businesses.

Isn’t that nice?  Free money to start a business.  Plus it gets even better after you’ve received your grant.

Small businesses accessing grant programs enjoy a bonus benefit: once you’ve successfully received funding, you’re more likely to get additional grants from the same agency because you meet their program requirements.

So, after you receive some government money, you’re more likely to get more money.  Shouldn’t it be that after you’ve received some money, you should be more likely to succeed on your own since you had a headstart?

This is the kind of thing that I sort of knew before but, now that I really know, I wish that I didn’t know.  You know?

8 Comments leave one →
  1. August 13, 2009 12:04 pm

    *sigh* Misleading sites like this are the bane of my existence … check out my post here


    • Michele permalink*
      August 13, 2009 3:59 pm

      Are those lists of companies which have received government funds wrong?

      They look very much like one I read from the Canadian Taxpayers Federation (only that one also had huge amounts given to large companies).

  2. August 14, 2009 9:07 am

    It’s not free government money … it depends on the program … and a good portion of the ones on this site, for instance, are loans/financing programs … and repayable.

    It’s misleading to promote small business grants as the majority are loans/alternative financing programs – NOT free money. Why would organizations or the government give you free money for your biz if you are not putting funds into it yourself?! And again, grants that are available to businesses are often quite targeted as to their industry.

    It’s also questionable as to how many of their “success stories” actually accessed (and paid for) their information … for example, one of their “success stories” I KNOW accessed a widely available government-sponsored loans program – fully repayable – WITHOUT purchasing their information.

    So the information is not necessarily wrong … it’s how it is presented that’s misleading, especially to small biz owners, whose money could definitely be put to better use.

    • Michele permalink*
      August 14, 2009 4:38 pm

      Okay. Maybe a lot of those are some type of loan. What percent do you think are actually repaid?

      On a related note, what do you think about this list of Industry Canada subsidies? I was shocked.

  3. August 17, 2009 9:16 am

    Percentage of loan repayment depends on the organization doing the lending … although since the risk tends to be higher, loan security is taken into account, etc. etc. My org. has a pretty good track record.

    Re: the subsidy list, I’m not sure what to make of it … the bulk of the funds come from aboriginal-based programs (e.g. ABDP, ACC) although it’s not stated what the “contribution” is used for … so I couldn’t say for sure!

  4. Michele permalink*
    August 17, 2009 5:20 pm

    An unpaid loan is effectively a grant.

  5. August 18, 2009 9:04 am

    Not if the loan security agreed upon was, say, your home, vehicle(s), or business … which are then liable to be repossesed upon default and applied to the balance outstanding … defaulting on a loan or financing agreement is not fun, and can seriously damage one’s credit and banking reputation for life … the best indicator of the future, however, is one’s past actions! 😉

  6. Harry permalink
    October 19, 2009 5:20 am

    I have found this blog by coinsidence, and I am glad I did! I would like to put my story to paper: Just a couple of weeks ago, I stumbled onto an advertised site, which sounded similar as the first story on this page. I could not belive, any Government would hand out money (to give grants) to practically anyone ! It made me curious to find out the truth. I was reading many comments of people, who said, they had applied and they all were paid a “Government Grant” which was absolutely non repayable ! Again, I wanted to know, what was behind this sceme. So I clicked where it said and I should make a test first, to see if I was eligible. So I clicked on this “test button” filled in my age, name and location. I submitted this and the answer was: You are eligible, click and go to the next step. The next step asked me to pay a very small “Processing fee” of US $3.95 and once payment was received, (visa card payments only accepted) I will be able to download those forms necessary for my application. I had second thoughts, I did not want to waste my money on an “almost unbeliveable offer”. So I clicked “exit” to close this page. Immediately, another window poped up, saying, don’t leave, as you can have it all for just US $1.- as a special offer. I thought, 1$ is not much wasted, if I find out who is silly enough to give away “FREE” money. I clicked again, entered my Visa card details and paid US $1.- Within a few minutes, I received a return email- receipt, including a username and password to log into their website. The email receipt also showed on the header, a very fine print, barely 2 mm tall (1/16″) in lightly grey colored print, where I was informed, under their terms and conditions they will from now on have the right to charge my visa card an ongoing monthly charge of US $ 79.86 unless cancelled within one day. I was shocked, I felt I was fallen victim to a scam. Immediately, I used the email-receipt for a reply and wanted to cancel my account. Bad luck, my reply email I had sent, was returned to me straight away, undeliverable it said ! So I tried to ring their customer service, one of several Phone numbers. The first number dialled, was answered with; check the number and dial again. I checked, dialled, and same answer. I rung the 24 hr service line, and after several attempts, I got an automated answer, to ring back in business hours. At 9 AM (next morning) I rung again. I was put on hold, finally after some 12 Minutes somone spoke to me. I explained, I wanted to cancel my account. Again I was put on hold, a minute later or so, the person said, o.k. the account is cancelled ! I did asked to have a reference number and to have this confirmed in an email. Sorry, he said we don”t send emails, but your cancellation number is xyz xyz
    I figured out, if anyone wants to see if the government is “handing out grants” don’t get caught like stupid me, ring your Gov.Department and ask if there is such a thing like “free money”
    I will find out, hopefully in a few weeks, if I got out of this SCAM without further charges to my visa card.
    My advice is: do never ever pay just $1 to apply for Info. Once they have your card details, you are lost to them. There is nothing much you can do, to stop them making charges to your card ! You may cancel your card, but they will get you, they are Experts in Scam-systems. I hope, you the Reader, can see how easily you can become a Scam victim

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