Most Canadian startups cannot rely on just one funding source. Grants often take time to secure. Venture capital (VC) is competitive and requires giving up ownership. Non-dilutive funding comes with specific rules. Founders who grow quickly use a mix of grants, VC, and non-dilutive funding. This strategy supports growth and protects ownership.
In Canada, this blended approach is common. Government programs encourage private investment. For example, the TELUS Pollinator Fund for Good has supported companies like Flash Forest, which first received grants from Sustainable Development Technology Canada (SDTC) before attracting VC investment. This shows how grants can help reduce early risk and attract impact funds and VCs.
Non-dilutive funding includes government grants, wage subsidies, and repayable contributions. These do not require you to give up equity.
A repayable contribution is a type of funding where you receive money you must pay back later, often based on your future revenue. This is different from a loan, as repayment usually depends on your business doing well.
Canadian founders often use non-dilutive funding to:
Why it matters:
Every dollar of non-dilutive funding increases your available cash. You keep more ownership. This makes your company more appealing to investors.
Common examples include:
GrantHub’s eligibility matcher can help you find programs by province and industry in seconds.
VC funding provides more money and can help you grow faster, but it also means higher expectations from investors.
The TELUS Pollinator Fund for Good is an impact-focused investment fund. It has invested in Canadian startups that show both purpose and growth.
TELUS Pollinator Fund for Good – Key Details
VC funds often favour founders who use grants to show they are making the most of their money. Using grants before or alongside VC shows careful financial management.
Canadian startups often combine these sources in different stages.
A common sequence looks like this:
Key rule:
You cannot claim the same expense from both a grant and an investor. Most programs require you to report all other funding sources.
Many first-time founders worry that grants make them look “too government-dependent.” In reality, the opposite is true.
Investors see grants as:
For example, the TELUS Pollinator Fund for Good supports companies that can scale impact and revenue. Grant funding often helps companies reach that stage.
Founders who plan both together raise less equity and keep more control.
VCs expect transparency. Not disclosing grants can delay or end a deal.
Grant audits are real. Misuse can lead to repayment or losing future funding.
Many grants have long approval times. Apply early—before you need the money.
Q: Is the TELUS Pollinator Fund for Good a grant?
No. It is an equity investment fund, not a non-repayable government grant. Startups give up equity for capital.
Q: Can I combine VC funding with government grants in Canada?
Yes. Many Canadian startups use both, as long as they follow the rules and do not claim expenses twice.
Q: Do I need revenue to qualify for the TELUS Pollinator Fund for Good?
Yes. Companies must have a product in-market and show growth and revenue potential.
Q: Does non-dilutive funding scare off investors?
Usually no. Most investors see grants as a positive when used carefully and openly.
Q: Are these funding strategies only for tech startups?
No. Health, agri-food, education, and climate-focused companies often combine grants and VC successfully.
Strong Canadian founders plan funding in layers, not silos. Grants reduce risk. VC helps you grow. Non-dilutive funding protects ownership when used well.
To find grant programs that fit your business, try GrantHub’s matcher before your next funding round.
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