Putting Millions Into the Hands of Women, Indigenous, and Black Entrepreneurs

Canada’s Business Development Bank Commits More Than $750M to Inclusive Entrepreneurship and a More Resilient Economy

This article was created with BDC, a B Lab U.S. & Canada partner for Champions Retreat 2024.

What does it look like for a bank to prioritize supporting entrepreneurs? How can programs and resources prioritize their success? These are some of the questions that the Business Development Bank of Canada (BDC), a federal crown corporation wholly owned by the Canadian people, has pursued as part of its mission to support small businesses and grow the economy.

“We provide financing, advisory services, tools, and resources to help businesses succeed, and we do it in a way that generates modest profits that we can reinvest in our goals,” said Sandra Odendahl, Senior Vice President and Head, Sustainability, Diversity & Social Impact, at BDC. “The people of Canada are the beneficiaries of the work we do, and we’re financially self-supporting.” 

Sandra Odendahl, Senior Vice President and Head, Sustainability, Diversity & Social Impact, at BDC

In recent years, BDC has expanded its focus on inclusive entrepreneurship to help address systemic barriers to funding for Indigenous, women, and Black entrepreneurs. They represent some of the fastest-growing groups in the Canadian workforce and can play important roles in building a more resilient and inclusive economy. The 2022 Canadian Entrepreneurship Census shows some of the challenges and opportunities:

• Women represent half of the Canadian population, but less than 20% are majority owners of businesses. As more Canadian women become entrepreneurs, programs for equitable financing and support are becoming more crucial for their growth and long-term success. 
• Indigenous people remain underrepresented among entrepreneurs. In 2023, 4.4% of Canadians aged 15 and over were Indigenous, and their entrepreneurship rate stood at 1.1%, well below the 2.3% rate for all Canadians.
• While Black people represent approximately 4.3% of the Canadian population, only 1.6% of small businesses are majority-owned by a Black person.

Addressing these demographic and financial gaps requires new ways of thinking about the role of finance in creating positive change. As a Certified B Corporation and national partner for the Canadian B Corp community, BDC operates with a governance framework that incorporates benefits for customers, employees, community, and the environment. 

BDC’s B Corp values are evident in their new initiatives to connect diverse entrepreneurs with capital to address social and environmental challenges, including: 

• A $50 million program for women, Indigenous, and Black entrepreneurs, offering loans up to $350,000 along with training.
• A $100 million fund to support Black-led businesses. 
• A $100 million fund to support Indigenous-led businesses
• A $500 million commitment to the Thrive Platform for women-led businesses. 

“It is baked into our strategic mission and business plans that we want to support entrepreneurs and would-be entrepreneurs from underrepresented communities with expanded opportunities,” Odendahl said. “We want to support their ability to deliver social impact. We also have programs to support their well-being and ensure that they are feeling equipped and resilient.”

Providing Entrepreneurs with Peer Support, Mentors, and Capital

Serving entrepreneurs where they are can be a challenge in a nation that spans 3.8 million square miles. Partnerships help BDC expand its geographic and demographic reach, especially in underserved communities. A coast-to-coast network of 50 trained champions at BDC business centers helps spread the word about its recently launched $50 million inclusive entrepreneurship program for businesses owned by women, Indigenous, and Black entrepreneurs with annual revenue under $3 million.

In addition to providing entrepreneurs in the program with loans of up to $350,000 with favorable interest rates and the option to postpone principal payments up to 24 months, BDC seeks to create lasting connections with them through its business centers and an online Entrepreneur’s Learning Center. “We want to make sure that those entrepreneurs have what they need to thrive, which is money,” Odendahl said. “But a lot of the time, they’re looking for more information, education, peer support, and mentors.”

To build knowledge and confidence, loan recipients can join cohorts that provide peer-to-peer and expert learning opportunities. They are also encouraged to opt into an online training and education program that includes a financial incentive. “They’re going to get a really great foundation in financial management,” Odendahl said. “Upon completion of the program, they also benefit from a better financing rate.”

Other partner-powered programs include a collaboration with Canada Post, the Canadian national postal service, focused on BDC’s small business loan program. “Canada Post has the largest retail network in the country, with post offices everywhere,” Odendahl said. “They are well-positioned to help us reach people in remote communities and spread the word about BDC’s financial offerings.” 

Community Futures offices also serve as partners in remote communities. This network of nearly 270 nonprofit offices across Canada provides small businesses with services and resources, primarily in rural and remote communities. “We direct clients to them and vice versa,” Odendahl said. 

One example of BDC’s fund innovation is Mélanie Paul, an Innu entrepreneur from Mashteuiatsh in Quebec, who has two businesses rooted in community and impact. In 2016, she launched Inukshuk Synergy to develop the market for wood biomass pellets, which are produced by a subsidiary of the ADL Group that has BDC’s Indigenous Banking Services as a partner. With her cousin Suzie, Paul started Akua Nature, which produces herbal teas, spices, and cosmetics that use native medicinal plants gathered by First Nations people. [Photo courtesy of Claude Mathieu (pubphoto.ca)]

Taking a Collaborative Approach for Women-Led Entrepreneur Funding

Beyond the $50 million Inclusive Entrepreneurship lending and training program, BDC is creating two $100 million funding platforms to support Indigenous and Black-led businesses. “We are consulting with entrepreneurs and community members to determine the best ways to provide them with investment and support,” Odendahl said, noting BDC is taking a collaborative approach with the funds and hiring lead roles from Black and Indigenous communities.   

The funds in development will complement the $500 million Thrive Platform for Women that BDC launched in 2022 to help women entrepreneurs, including Indigenous and Black women entrepreneurs, overcome barriers to funding. “We want to make sure they have access to everything they need to thrive and have a lasting impact,” Odendahl said. It includes three components:

• Thrive Venture Fund, a $300 million investment commitment that is an extension of BDC Capital’s Women in Tech fund. “We invest in seed stage and women-led technology companies across a range of sectors,” Odendahl said.   
• Thrive Lab for Women, a $100 million commitment to women-led companies looking to create positive social change. Through this fund, BDC and partners invest in the Canadian impact ecosystem. “We’re investing in companies at the earliest stage of development,” Odendahl said. “These women-led companies measure success not only by financial growth, but also by the significant impact they are making with solutions to social and environmental issues.”  
• Thrive Indirect Investment Envelope for companies led or co-led by women. To date, $34 million of this $100 million initiative launched in 2023 has been committed to six women-led funds.  

Building the Canadian B Corp Community with Education and Collaboration

Being part of the B Corp community is another way that BDC is helping to build a more inclusive economy. As a national partner and advocate for the B Corp community in Canada, BDC encourages business owners to use the B Impact Assessment to measure and manage their impact. 

Odendahl said BDC’s belief in the B Corp community is reflected in almost $200 million in financing committed to 133 B Corps in its portfolio. “More than a quarter of all Canadian B Corps are BDC clients,” she said. BDC’s support for the organization includes featuring B Corp entrepreneurs like Jenn Harper of Cheekbone Beauty and Anie Rouleau of The Unscented Company in its introductory B Corp 101 workshops. “We use these as an opportunity to highlight great entrepreneurs in Canada,” Odendahl said. 

As it aims to expand its reach and relevance for entrepreneurs, BDC continues to develop resources. These include a DEI Toolkit with templates for reporting and policy, guides for inclusive writing and hiring, and other implementation strategies, and well-being information that includes access to support. “We look at all of these as wraparound supports, so that entrepreneurs can enhance their business growth and personal development,” Odendahl said.