Innovation scene in Toronto’s on-demand app industry provides startups with the right ingredients for success: the government’s immense support, extensive collaboration opportunities, and qualified developers.
Still, having enough capital is essential to make your mobile app, serve it before the early adopters, and eventually scale up your business.
Plus, sufficient funding can protect your startup from unexpected downturns.
Luckily, Canada’s mobile app market continues to grow, attracting investors from all around the world.
As such, there are plenty of funding opportunities in Toronto for up-and-coming startups like you.
Source: Statista
Types of Funding Available for Mobile App Startups
App development is key for Toronto startups, but building one isn’t particularly cheap.
For starters, you have to hire a reliable mobile app development agency in Toronto. While you can outsource freelancers, which are usually more affordable, the speed and quality just won’t match established agencies.
Not to mention, the marketing budget you have to spend to promote your new mobile app. PPC ads, influencer partnerships, TV commercials, and the list goes on.
Needless to say, you need money to get your startup up and running.
Don’t know where to look? Here are several funding sources you can get for your project.
Venture Capital
Venture Capital (VC) is a kind of private equity funding for startups with high growth potential.
VC companies invest money to help startups grow in exchange for ownership shares. Oftentimes, they also offer mentorship and networks to help startups succeed.
Big Canada-based VC firms include Georgian Partners who backed the undeniably successful Shopify and Antler, which operate across different countries and industries.
There’s also ScaleUp. It’s quite young compared to the others, but it supports many local startups in Canada.
Angel Investors
Angel investors are always on the lookout for potential startups. They are individuals investing their own money in early-stage startups. In return, they receive equity in the company.
Aside from funds, angel investors usually provide the expertise and connections necessary for your success. If you can somehow convince them to invest in your project, that will be a major win.
Government Grants and Programs
The Canadian government supports tech hubs through direct financial grants, tax reductions, loans, networking, and mentorship.
App development talents throughout Canada can participate in Canada Summer Jobs and Canada Media Fund offered by the federal government.
Plus, the Toronto Regional Board of Trade’s Trade Accelerator Program, Toronto Innovation Hub, and the Ontario government’s Innovation Fund provide ample resources for mobile app startups.
Alternatively, many specific grants and programs are accessible on the Ontario Government’s official website.
Crowdfunding
This type of funding refers to a capital-raising act involving a large pool of people.
Platforms like Kickstarter and IndieGoGo facilitate the crowdfunding campaign by connecting creators with potential supporters.
Accelerators and Incubators
Incubators offer support for startups by providing workspace, mentorship, and required tools.
Meanwhile, accelerators are like bootcamp programs for tech startups, which cover short courses and investment for equity.
The most viable option is NEXT Canada, a national program focusing on mentorship, funding, and connections for early-stage startups.
You can also consider MaRS Discovery District’s program, which offers learning resources and funding opportunities.
| Funding Type | Description | Example |
| Venture Capital | Investment from professional firms in potential startups | Georgian Partners |
| Angel Investors | High-net-worth individuals investing in early-stage startups | Angel Investors Ontario (AIO) |
| Government Grants and Programs | Financial support from government agencies to enhance innovation | Toronto Innovation Hub |
| Crowdfunding | Raising funds from a large number of people through campaign platforms | Kickstarter |
| Accelerators/Incubators | Programs offering mentorship, resources, and funding to startups | MaRS Discovery District |
How to Prepare for Funding Applications
Develop a Solid Business Plan
A well-structured business plan helps investors assess the risks and rewards of funding your startup.
Thoroughly conduct market research and competitor analysis before outlining your app’s value proposition, market potential, business model, team expertise, product benefits, and financial projections.
Build a Strong Pitch Deck
Investors have seen many pitches, so make sure yours is quick and impressive. Keep your pitch deck concise, around 10 slides – it is different from a comprehensive business plan.
Most importantly, appeal with visual presentation, using clean design and quality images.
Remember to summarise important details from your business plan into your deck. Also, articulate the problems your mobile can solve through engaging storytelling.
Finally, specify funding needs and demonstrate your revenue model.
According to Kate Tomen, building a robust investor list and treating fundraising as a numbers game is key to securing startup capital.
Proof of Concept and Market Validation
Validate your app idea, before asking investors to believe you. To do so, build a prototype or a Minimum Viable Product (MVP).
While a prototype is a basic design and MVP is a working product with limited features, both can help investors see your app’s worth.
Tips for Navigating the Funding Landscape
Raising capital is an important step for any startup to launch a powerful mobile app. These strategies can help you secure funding:
Seed Funding: Initial capital to develop your initial mobile app, can be from family, friends, or angel investors.
Series A: First institutional funding for product development and market expansion.
Series B: This stage involves a larger investment from VC firms to scale the operation and enhance products.
Series C: The final stage focuses on fueling startups’ rapid growth and becoming an industry leader.
Conclusion
We’ve broken down different types of funding for mobile app startups in Toronto, including angel investors, venture capital, government grants, accelerators/incubators, and crowdfunding.
While securing funding can be challenging, understanding the process step-by-step, creating a compelling pitch, and building relationships with tech experts can help you succeed.
If anything, you can contact our app development experts in Canada for further guidance. Good luck with your mobile app startup journey!
