Partnering to Help Next Gen of Entrepreneurs
In 2010, there was a wildly popular and highly acclaimed movie about a young entrepreneur who turned a program he created while drinking in his dorm room into a billion dollar company. The film was called The Social Network, and it dramatized the creation of Facebook, providing an entrepreneurial narrative for many aspiring programmers and business students alike. Much of the story is pure fiction, but the central drama revolves around an all-too-real problem for young entrepreneurs -- finding financing.
SuccessionMatching’s Be Your Own Boss program is a youth engagement program designed to help young entrepreneurs turn their dreams into reality. By partnering with educational institutions in multiple provinces across Canada, as well as organizations such as the Business Development Bank of Canada (BDC), the program aims to bring the right people together at the right time to help young entrepreneurs succeed. As the list of partnering educational institutions and organizations continues growing, the program continues strengthening its capacity to tackle major barriers to entrepreneurship. One major barrier entrepreneurs run into, particularly when starting up their first business, is securing the financing they need.
One potential solution to this barrier is to talk to someone at BDC. “Our goal is to create and develop strong Canadian businesses, to make Canadian entrepreneurs the most competitive in the world,” says Candace Hrycan, an Account Manager at BDC. “We can offer our clients some flexibilities in financing that chartered banks and private lending institutions can’t because we are the only bank exclusively dedicated to helping entrepreneurs,” she adds.
Candace explains that BDC wants to be a member of an entrepreneur’s team, to support them, to provide financial advice, and to help them find solutions that fit their specific and sometimes unconventional problems. “We have a lot of experience, data, and knowledge. We can advise entrepreneurs in things like sales and marketing, human resources, and strategic planning in addition to financial management,” she says.
In fact, the partnership between SuccessMatching and BDC aims to help entrepreneurs in an unconventional way - by helping them meet with business owners looking to retire or transition ownership. Entrepreneurs don’t have to start from scratch by forming a startup. Instead, they can purchase an existing business and take over its existing operations. BDC estimates about 60% of small to medium sized business owners are at age 50 and over, meaning there will be hundreds of thousands of businesses looking to transition in the coming years.
Taking ownership of an existing business provides a lot of advantages over beginning a startup such as retaining knowledgeable staff, receiving mentorship from the exiting owner, and already having brand recognition and a strong community reputation. These can all be factors that a lending partner like BDC will take into account when working with an entrepreneur. But perhaps the most important advantage that purchasing a business has over starting one up is its existing cash flow.
“We want to see that the entrepreneur has done their due diligence and knows what their cash flow is going to look like,” says Candace. “We don’t want these businesses to cease – we want to help them transition! And after the transition, we want to make sure the business has sufficient working capital for continued success, including its operations, wages, capital expenditures, and so on.” Having that existing cash flow can help entrepreneurs figure out exactly how much capital they need, and how much financing they can secure, to make their first business venture a successful one.
Through the Be Your Own Boss program, alumni and students that qualify from participating post-secondary schools can have free access to SuccessionMatching. For more information, please the Be Your Own Boss program page.
If you or your institution is interested in getting involved with the Be Your Own Boss program, contact firstname.lastname@example.org for more information and help the current and next generation of entrepreneurs succeed.
SuccessionMatching is an online community that matches buyers and sellers of businesses. SuccessionMatching’s network and tools are perfectly suited to bridge the gap between business owners looking to retire and youth entrepreneurship.