On Tuesday February 11, 2014, Finance Minister Jim Flaherty presented the Canadian federal budget for fiscal year 2014-2015. The budget proposes to provide an additional $40 million over four years to the Canada Accelerator and Incubator Program (“CAIP”) starting in 2015-2016. The organizations that will receive the incubator financing will be announced in the coming months.
The Federal Government launched CAIP in September 2013 as part of the Venture Capital Action Plan. In last year’s budget, the government allocated $60 million over five years to CAIP. This brings the total federal funding for CAIP to $100 million.
The relevant portion of the 2014 federal budget can be found here.
Business accelerators1 and incubators2 provide startup companies with a range of support including mentoring, office space, and financing. They play an important role in assisting entrepreneurs to realize the business potential of their ideas and create new companies. CAIP provides funding in the form of non-repayable contributions to outstanding and high-potential accelerators and incubators that meet the required criteria.
More information on eligibility, selection criteria, and proposals to CAIP can be found here.
This support of entrepreneurship comes soon after the Ontario government, through the Ministry of Research and Innovation (the “Ministry”), committed to investing $190 million over the next six years to the Research Excellence and Research Infrastructure programs under the Ministry of Ontario Research Fund (see our blog post here).
1 Accelerators are generally for-profit organizations owned and operated by venture capital investors.
2 Incubators are generally not-for-profit organizations that provide similar services but usually for a longer tenure with broader services. They are often sponsored by colleges, universities or economic development corporations.