Frequently asked questions

What can the SDEVM funds can be used for?

Our funds can be used to fulfill different needs such as: long term assets acquisition (equipment, hardware, software, etc.), working capital, market development and exports, leasehold improvements, salaries, advertising and promotion, legal fees (strategic alliances, patents), etc.

What type of project is eligible for SDEVM financing?

In general, all kinds of projects are eligible, except for the following: retailers, franchises, import/export (wholesalers), restaurants, hotels and bars, real estate management, financial services and insurance brokerage, liberal profession recognized by a professional order (lawyer, accountant, architect, notary, engineer), unless the project deals with asset creation.

Does SDEVM finance enterprises that pursue R&D (Research and Development) activities?

In most cases, our financing assistance is provided to enterprises that are going through their commercialisation stage. Indeed, in order to meet debt requirements, the company has to generate revenues.

Nonetheless, the SDEVM can support innovative businesses that pursue R&D activities. However, those enterprises have to generate revenues simultaneously with R&D, either by selling other products it already developed, or by offering consulting services which can also help refine the R&D in progress. Depending on the financial capacity deriving from those revenues, an innovative business could certainly be eligible for SDEVM financing.

What type of assistance is available to help me write my business plan?

If you wish to write your business plan by yourself, there are different types of resources out there. You will certainly have to put in time and energy but the process will allow you to develop a real strategic vision about your project.

To use an existing framework is a good way to start. If you wish to get some training or coaching to help you out, contact the SAJE (Service d’aide aux jeunes entrepreneurs)

- BDC consulting group (Business development Bank)

-CYBF interactive Business Plan

Which CLD should I contact in order to get assistance for my business start-up?

The CLD network (“Centre local de développement” or Local Development Centers) offers front end services of technical and financial nature for entrepreneurs. Each CLD is responsible for a determined geographical area. Therefore, it is important to identify the one that corresponds to the area where you want to develop your business.

What is the difference between business registration and incorporation? Which one is mandatory to operate a business?

In Quebec, the majority of enterprises are obligated, upon their founding, to register with the “Registraire des enterprises” and to declare its legal form. Registration is indeed mandatory except for the following: individuals operating a sole proprietorship in Quebec under a name that includes both their first and last name, and that do not sell tobacco products (for instance, “Accounting services Jane Bell”). Registration has to be renewed every year.

Incorporation, which is not mandatory, is a legal structure of the enterprise which the entrepreneur may choose based on their needs and objectives. Amongst the various types of profit-making enterprises, there are three different legal forms: sole proprietorship, partnerships and legal persons (or incorporation). To incorporate your business does not exempt you from registering – these are distinctive steps although it is possible to do both at the same time.

Why should I incorporate? What are the advantages of incorporating my business?

Incorporating your business leads to various benefits, including:

- Limited liability: Potential losses are limited to the amounts invested in the company or to the personal guarantees, if applicable.

- Continuous existence: Unlike a partnership or a sole proprietorship, a corporation does not cease to exist upon the death of its owner(s).

- Lower corporate tax rates: Accountants recommend to incorporate your business when revenues reach a determined level.

- Greater access to capital: Raising capital is often easier for corporations since they are entitled to issue bonds or share certificates. In addition, corporations are often able to borrow capital at a much lower rate than other forms of business as financial institutions often perceive loans to corporations as being less risky investments.

For more information on the various advantages of incorporating, check out Corporations Canada website.