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May 2009 - Richard Conley, Adam Hassett & Ian Longshaw
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May 2009 - Richard Conley, Adam Hassett & Ian Longshaw

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Entrepreneurs First - BDC Consulting

Entrepreneurs First - BDC Consulting

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  • Risk sharing : Allows you to provide more for your clients without having to take on risks that you deem too big.
  • Criteria for Working Capital (general) Not only an experienced management team but a solid profit history Projected sales growth and good profit potential Review engagement or audited year-end financial statements -------------------------------------------------------------------------------------------------------- SUPPLEMENTARY NOTES TO HELP YOU ANSWERING QUESTIONS Innovation Financing (max. $250K) Finance the growth of the business and development & implementation of innovation strategies Eligible businesses in all industry sectors Eligible projects examples: Management / staff training & development Adoption of industry standards Purchase of new technologies Marketing plans or development of export markets Working capital: to sustain activities or replenish W/C depleted by capital expenditures Fixed assets: leasehold improvements & specialized assets Change of ownership : all including MBIs/MBOs, refinancing of vendor take back if the VTB is the result of a prior change of ownership. Repayment period = 8 years Term debt to equity ratio: not exceed 4.1 when total commitment for authorization = or less than $150K and 3:1 if more than $150K.
  • Company needs : increased inventory for a greater demand from clients and addition of new clients. Solutions offered : increase line of credit in addition to BDC financing to bridge the gap in needs.
  • For clients whose company is growing and that want to: maintain cash flow, increase production, increase sales and profits. --------------------------------------------------------------------------------------------------------- SUPPLEMENTARY NOTES TO HELP YOU ANSWERING QUESTIONS PRODUCTIVITY PLUS LOAN (Max. $5M) Manufacturing & processing sectors Businesses in operation for at least 1 full year Refinancing : if it’s to obtain full control of fixed assets Working capital : replenish W/C depleted by the purchase (during the last fiscal year) Real Estate : could include a real estate component, which must represent less than 50% of the project
  • Repayment period: 12 years Security : Pari passu loan agreement with another institution. First mortgage on financed assets. RLV 40 %.
  • Repayment period: 12 years Security : Pari passu loan agreement with another institution. First mortgage on financed assets. RLV 40 %.
  • Business ownership transition: Creation of succession plan: Choosing the right successor, planning the transfer of expertise, Family businesses: assisting with internal conflicts and confusion
  • SR&ED: Scientific Research and Experimental Development tax credit program

May 2009 - Richard Conley, Adam Hassett & Ian Longshaw May 2009 - Richard Conley, Adam Hassett & Ian Longshaw Presentation Transcript

  • Presented to: Fraser Valley C.A. Association By: Richard Conley, Ian Longshaw & Adam Hassett
  • BDC Profile
    • Our mission: ‘Entrepreneurs First’
    • (To assist and support successful Canadian business’)
      • Long-term financial solutions for every stage of growth
      • The BDC Team offers:
        • Existing Business Financing
        • Change of Ownership Financing
        • Consulting Services
        • Subordinate Financing (mezzanine)
        • Venture Capital Financing
  • Complementary services
    • Risk sharing: to help provide additional support to businesses
    • A complementary offer: Long-term financing for additional working capital and acquisition needs.
    • BDC does not provide:
      • Bank accounts
      • Term deposits or investment certificates
      • Sale of RRSPs, insurance
      • Lines of Credit
      • Equipment leasing
      • Residential or non-commercial loans
    • Benefit from our focus in these markets:
      • Manufacturing and transformation
      • Exporters
      • Knowledge-based industries
      • Wholesalers / distributors
      • Construction
      • Business services
    • BDC does not provide financing:
      • To bars, nightclubs, gambling operations, activities of a sexual nature, privates clubs
      • To non-Canadian businesses
      • To companies that are in default of environmental regulations
      • and do not want to comply
    A complementary partner in key markets
  • Working Capital
    • Financing possibilities:
    • Increase inventory to boost sales and receivables
    • Replenish working capital depleted by capital expenditures
    • Explore new export markets or develop products
    • Criteria for financing:
    • An existing Line of Credit
    • An experienced management team
  • Working Capital Financing Example Manufacturer in business 2 years. 100% sales growth.
    • Benefits:
    • Support current operations and reduce pressure on account receivables.
    Project Financing Purchase of Inventory $250,000 BDC Working Capital $250,000 Total $250,000 Total $250,000
  • Equipment Financing
    • Objective: Helping your clients improve productivity
    • Financing possibilities:
    • Purchasing equipment (new or used) up to 125%
    • Purchasing a production line or automating current one
    • How BDC can help you protect your client’s cash flow?
    • Long-term financing up to $5,000,000
    • Additional working capital (up to 25% of the equipment cost) to cover soft costs (training, transportation, etc.)
    • Repayment period of up to 12 years
  • Equipment Financing Example 1
    • Secured by: GSA with first charge on the programmed equipment
    Project Financing Purchase Equipment $1,000,000 BDC $1,250,000 Soft Costs/Training 250,000 Total $250,000 Total $250,000
  • Equipment Financing Example 2 Benefits:
    • Higher percentage of financing for your client
    • Growth supported by the partnership of 2 financial institutions.
    Food manufacturer in business since 1 977. 175 employees and $ 64 M in S ales. Project Financing Purchase Equipment $6,000,000 BDC (pari passu) $3,350,000 Installation 700,000 Clients Bank (pari passu) 3,350,000 Total $6,700,000 Total $6,700,000
  • Land & Building Financing
    • Financing possibilities:
      • Purchase of land and building
      • Expansion or improvement of existing premises
      • Construction of new premises
    • How can BDC help you to offer more?
      • Non-demand long-term financing up to 30 years to help protect cash flow
      • Progressive or seasonal repayment options tailored to your client business' cash flow
  • Land & Building Financing Example
    • Industry: Metal Fabrication
    • Term Debt to Equity = 3.5 to 1
    • Good personal credit history
    • Security: mortgage & personal guarantee
    • Principal is experienced in industry
    Project Financing Purchase Strata Unit $480,000 BDC $360,000 S/H Injection 120,000 Total $480,000 Total $480,000
    • Increasing a company’s value while reducing costs
    • Operational efficiency – Helps your clients reduce waste/inefficiencies, improve profitability and become more competitive.
      • Increased productivity (15% to 35%)
      • Improved quality control and reduction of costs (10% to 30%)
      • Reduced inventory (30% to 80%)
      • Reduced setup time (30% to 90%)
    • Quality (ISO, HACCP) - Certification
      • ISO 9001 : 2000 (quality management)
      • ISO 14000 (environmental)
      • HACCP ( Hazard Analysis Critical Control Point ) for the agribusiness sector
    BDC Consulting
  • A vision to ensure continuity
    • Strategic/business planning
      • Positioning the company in the market
      • Setting future objectives and the resources needed to get there
    • HR management
      • Recruiting, training, retaining the right people
    • Business ownership transition
      • Creation of a succession plan
      • Family businesses
    BDC Consulting
  • Growth via development and innovation
    • Marketing and sales
      • Analysis of market and competition
      • Marketing plan and promotion
      • Sales strategy
    • Exporting
      • Training on promising markets
      • Export strategy and plan
    • SR&ED tax credits
      • Assessing eligibility and preparing tax credit application
    BDC Consulting
  • Thank you