FINANCE GROWTH

HOW TO FINANCE PROJECTS

By Frederico Panetta – CEO, Gould Industries

Every business owner, builder, and visionary hits the same critical point — the moment where capital must meet ambition. Whether it's a new factory line, a facility expansion, or a product launch, financing your project correctly is often the difference between scaling with confidence or drowning in obligations.

Let’s break it down: What’s the best way to finance a project?

Is the Bank Always the Best Option?

Not always — but banks do remain one of the most accessible and regulated sources of capital. With clear guidelines, historical lending patterns, and set repayment structures, banks provide predictable debt financing. But remember:

Banks don’t fund dreams. They fund stability.

This means they’ll analyze your project with cold calculation: credit score, cash flow, assets, ratios, repayment capacity. If you check the boxes, great. But innovation, risk, or early-stage ventures often get pushed aside.

That’s where negotiation comes in.

How to Negotiate with Banks

Banks aren’t there to say “yes” or “no” — they’re there to evaluate risk. Your job is to de-risk the conversation:

• Prepare a complete package: business plan, cash flow projections, project ROI, timeline, and contingencies.

• Show historical performance: not just revenue, but margin consistency, supplier contracts, and customer retention.

• Negotiate the terms, not just the amount: amortization period, grace period, balloon payment options, interest type (fixed vs. variable). This is where leverage is born.

🔑 Longer terms = lower monthly burden. This helps soften the pressure on early sales and protects cash flow in the ramp-up phase.

If you structure it right, your bank debt becomes an accelerator — not a straitjacket.

Recommended read:Business Development Bank of Canada (BDC) – Guide to Project Financing

Does It Make Sense to Give Equity?

Equity is powerful — but expensive.

When you give away equity, you're not just sharing profits — you're giving away control, decision-making, and sometimes, identity. That said, equity capital (from investors, venture funds, or private equity) can be the right tool when:

• You're scaling faster than debt can support

• You have no collateral for loans

• You're in a high-growth or high-risk industry

• You want smart capital: partners who bring more than just money

Just remember: equity is forever. Choose wisely who you let in.

When Is It Time to Open Up the Pie?

The pie — your ownership — should only be shared when:

• The value brought in exceeds the value you give up

• You’re bottlenecked without new capital

• The investor brings strategic partnerships, not just funding

• You’ve hit a leverage point — where growth will multiply returns

🧠 Rule of thumb: If $1M in equity funding helps you build a $10M business in 24 months, it’s worth considering.

Also consider convertible debt or SAFE agreements — flexible equity-linked tools that delay ownership decisions while injecting cash now. These are common in the U.S. and Canada for startups and early-stage ventures.

Credible platforms to explore equity funding:

• Angelist Canada – Early-stage investor network

• FrontFundr – Equity crowdfunding platform

• BDC Capital – Canada's venture capital arm for growth financing

• Inovia Capital – Montreal-based VC for scaling businesses

The Financing Mindset

Financing a project is not just about “getting the money.” It’s about structuring growth. Every loan, line of credit, or equity share should be viewed through this lens:

• Does this help or hurt my cash flow?

• Is this capital flexible or restrictive?

• Does this investment open new revenue or reduce future margin?

In our 70+ years at Gould Industries, we’ve used every tool in the financing playbook — from classic commercial debt to strategic partnerships. And I’ve learned this:

Capital is not just money. It’s trust. It’s alignment. And it’s timing.

Use it wisely, and it becomes your fuel. Use it recklessly, and it becomes your anchor.