1. Lockheed Martin Canada’s SMB Mentoring Program
Economic Development Opportunities (EDO)

2. EDO and Government Assistance
SMBs often have access to enhanced economic incentives over and above large businesses in Canada
Federally
Provincially
SMBs often have more flexibility to consider different types of funding than larger companies with stricter policies
Grants
Low-cost Loans
Forgivable loans
Leverage these tools in order to supplement your R&D resources and make yourself more competitive.
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Definitions
EDO = Economic Development Opportunities which are equivalent to Government Incentives
SR&ED = The Canadian Scientific Research and Experimental Development Tax Incentive which supports corporations, partnerships or individuals who conduct scientific research or experimental development in Canada
SMB = Small and Medium Business
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Types of EDOs
EDO opportunities for SMBs are funded by:
Federal Government
Provincial Governments
EDO opportunities typically take the form of:
Tax credits
Grants
Loans
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5. Select Examples of EDOs
Tax Credits
SR&ED tax credits
Significantly enhanced tax credit rate for SMBs performing qualifying work in Canada: 35% cash refund federally plus provincial tax credit rate
Federal tax credit rate for large corporations is 15% plus, in some cases, a lower provincial rate
Digital Media Tax Credits
Provincially administered credits in NS, QC, ON, BC with similar philosophies but different criteria & administration
Loans
SADI – Strategic Aerospace and Defence Initiative
Federal program that provides repayable contributions to support research and development (R&D) projects in the aerospace, space, defence and security (A&D) sectors. SADI is available to firms of all sizes to support product, service or process innovation
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6. Select Examples of EDOs Cont’d
Grants
IRAP – Industrial Research Assistance Program
Federal Program providing technology assistance to small and medium-sized enterprises (SMEs), at all stages of the innovation process, to build their innovation capacity and successfully take their ideas to market.
OCE – Ontario Centres of Excellence
In partnership with industry, OCE co-invests to commercialize innovation originating in the province’s publicly funded colleges, universities and research hospitals. Also supports and invests in early-stage projects, where the probability of commercial success and potential total return on innovation are substantial.
TDP – Technology Demonstration Program
Federal program that provides non-repayable contributions to support one or more large-scale research and development (R&D) projects per year.
Mitacs
Federal program that manages and funds research and training programs for undergraduate, graduate students and postdoctoral fellows in partnership with universities, industry and government. Also supports two-way research collaboration between Canada and international partners.
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EDO Considerations
Cannot be the sole reason for doing business
EDO should complement the engagement … not drive the engagement
Many forms and sources of government assistance
Focus on ones with good net value (amount of the incentive minus the effort to apply/report/defend)
You don’t have to be an expert in all incentives; but you should have some base level knowledge
There are free experts (government employees)
There are paid experts (e.g. accounting & tax firms)
PLAN!
Often a long lead time process; don’t expect quick turnarounds
Typically months to work through applications, approvals & agreements
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8. Why EDOs are Important to Large Businesses
Lowers the cost of an investment
Government assistance direct to large organizations lowers costs
Government assistance to an SMB lowers the cost of a large organization’s investment
Increase the scope of work based on investment
Leveraging government assistance could lead to increased scope of work/more capability or functionality for the same level of large organization investment
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Conclusion
SMBs have access to (and the versatility to apply) EDOs that may not be available to larger companies
SMBs can leverage these EDOs to:
Lower their own costs
Work in partnership with larger businesses who may not be able to apply these EDOs directly
SMBs don’t have to be experts in all EDOs, but should:
Become aware of Federal EDOs and determine which provide the ideal ROI for their particular business
Become aware of all EDOs within the provinces in which they do business
Hire a consultant to ensure you are maximizing your opportunities and to develop in-house expertise
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Helpful Links
Scientific Research and Experimental Development Tax Incentive Program (SR&ED)
Sustainable Development Technology Canada
Build-in-Canada Innovation Program (BCIP)
Digital Media Tax Credits:
Nova Scotia
Ontario
Quebec
British Columbia
IRAP – Industrial Research Assistance Program
OCE – Ontario Centres of Excellence
TDP – Technology Demonstration Program
SADI – Strategic Aerospace and Defence Initiative
Mitacs – National, not-for-profit that has designed and delivered research and training program in Canada
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