FedDev formally announces new regional loan fund for small "knowledge-based" businesses

FedDev today officially announced the $12 million funding for the Western Ontario CFDC Association that I mentioned last month (see "Some FedDev fundings from January, February, March," June 5). The money is being used to create a new fund that will provide knowledge-based small and medium-sized businesses loans of up to $500,000.

All of Southwestern Ontario is in the region covered by the new fund. The Eastern Ontario CFDC Network has received $8 million for a similar fund for that region. Together, FedDev is calling the two new funds the Southern Ontario Fund for Investment in Innovation (SOFII).

Businesses can receive loans from $150,000 to $500,000. FedDev says companies will use the money for "all aspects of innovative SME growth challenges, including: late stage commercialization, new product or service development, new applications or markets, and development or implementation of new processes or technologies."

Although the core programs of CFDCs have focused on rural areas, when I talked to the WOCFDCA they said that, for this fund, they wanted to work with companies in urban areas as well.

On the SOFII website, it says that "knowledge-based industry includes, but is not limited to, firms involved in pharmaceuticals, health biotech, new materials, telecommunications, information technology, software, medical equipment and avionics."

Southwestern Ontario will be served through the office at the Sarnia Lambton Business Development Corporation.

UPDATE: This line from the SOFII website about eligibility was a little deflating: "Eligible organizations will: Employ 50 to 500 employees, or identify that there is a strong likelihood they will reach 50 employees within the term of the loan." Since there's less than two years left in FedDev's mandate, there aren't many early-stage tech companies that would be eligible.

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