1 Commercialization Support for Business Program Guidelines. Introduction. Eligibility

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1 Introduction This document is to assist you in completing the application form under the Commercialization Support for Business Program (CSB). This is a general guide and the information is being updated on an ongoing basis. Because of the unique nature of each project the guide cannot take every potential scenario into consideration. The CSB Program targets Manitoba entrepreneurs and businesses seeking to develop and commercialize innovative products, processes, and expand into new markets outside of Manitoba. The objectives of the program are to: Commercialize innovative products or processes; Leverage private sector investment; Create economic growth Create jobs Grow exports The CSB provides financial assistance to cost share eligible expenses on a 50/50 basis. The Government of Manitoba s total contribution will not exceed 50 per cent of approved costs. Total government support from all levels of government (federal, provincial, municipal), including tax rebates, cannot exceed 50 per cent of total costs. Depending on the nature of the project, companies which qualify for assistance under other Manitoba financial assistance programs are required to apply under those programs first. Eligibility Eligible recipients are: Individuals (sole proprietors) Business Entities For-profit Canadian Controlled Private Corporations, business co-operatives, partnerships, joint-ventures (both corporate or individual), that had: o For the immediately preceding calendar year, less than 50 full-time equivalent employees: or o Gross revenue of the corporation and its affiliates (determined on a consolidated basis, where applicable) for the most recently completed fiscal period is less than $15,000,000. At least 25% of the full-time equivalent employees of the corporation and its affiliates reside in Manitoba. Ineligible recipients are: Not-for-profit organizations; Business Entities, or Individuals principally engaged in: Real estate, local retail, restaurant, hospitality, natural resource exploration, primary farming, fishing, trapping, or logging activities; Professional practice which is regulated by a governing body of the profession; 1 Commercialization Support for Business Program Guidelines

2 Insurance or financial services, or Crown corporations, municipalities, towns and cities, consulting based companies. Funding The CSB Program provides cost shared assistance through three streams. 1. Product Development (up to $50,000) The purpose of the stream is to assist Business Entities or Individuals developing their product or process. Funding will be disbursed based on the achievement of agreed upon outcomes stated in the application. The project outcomes for Stream 1 include: registration of intellectual property, obtaining product certification, completion of a working prototype or finished good and delivery of a market validated study that includes third party verification of the core results. This stream does not support basic research and development activities, and applicants must demonstrate that the concept is feasible prior to applying to this stream. To prove feasibility of the market, the entrepreneur/management team should make extensive use of secondary research about the market from standard industry publications and analyst reports. These are typically available from the major brokerage houses and major players in the overall market. This research can also involve industry specific reports prepared by third party consulting firms that are available for sale. Primary research using a convenience sample of identified potential customers can also be used, especially if the underlying concept is based on the work experience of the lead entrepreneur. Applicants should refer to the Market Validation Guidelines for more detail. Applicants may also refer to an example of a completed application form for Stream Commercialization ($50,000 - $250,000) The purpose of the stream is to assist Business Entities commercialize their product or process and move towards becoming a fast growth, scalable venture. Business entities must apply to and achieve the outcomes of Stream 1 of the Program in order to be eligible to apply to Stream 2. Business entities applying under this stream must demonstrate the opportunity exists via a thorough market validation study and include a business plan. Entities must also demonstrate they have a functional beta version of the product. The project outcomes for Stream 2 include: beta trials, completion of a finished good, production of a marketing and sales plan for the product launch, or activities as recommended by the Advisory Council. Applicants under Stream 2 must be working full time on their venture. 3. Market Access Program (up to $30,000) The purpose of the stream is to assist Business Entities to design marketing materials and engage in activities that will enable them to enter new markets outside of Manitoba. This stream has two components: Trade Show Assistance and Marketing Materials Design. Trade Show Assistance This component supports companies who want to participate in trade show events outside of Manitoba. Companies may receive assistance to attend up to two trade shows in one fiscal year (based on the Department s year end of March 31), but not to attend the same trade show more than twice. Financial 2 Commercialization Support for Business Program Guidelines

3 assistance for each show is up to a maximum of $10,000 per show. The application should be submitted as early as possible but a complete application must be received no later than four weeks prior to the show. Applicants wanting to apply under this component need to provide: Event information name, location, date; Purpose of participation in the event; Products to be promoted at the event; Breakdown of the costs for the event including quotes Eligible expenses that may be covered at 50%: Two economy class airfares for company employees Trade show space Onsite translator Rentals of equipment for booth (furniture) Electrical hook-up for the booth Tents (for outside shows) Reimbursement of gasoline expenses, when it is shown to be less expensive than flying Renting turnkey booths (where a company obtains a booth that includes lights, power, walls, etc) Ineligible expenses: Company labour at the booth Accommodations Ground transportation Per diems / food / meal costs Costs of goods or samples Costs of shipping Costs of extra baggage Sponsorship Conference Registration Marketing Materials Design: This component supports companies who want to engage 3 rd party consultants to design marketing materials to assist the company to enter new markets outside of Manitoba. Financial assistance targets design costs covering 50%, up to a maximum of $10,000 per new market and fiscal year. Each request under this component needs to include: The 3 rd party proposal or statement of work, outlining the work being done with breakdown of activities identifying design costs of the marketing materials. The proposal must be on vendor s letterhead containing full contact details. Purpose and scope of the proposed marketing project with start and finish dates. Eligible expenses that may be covered at 50%: One time third party booth development Translation of marketing materials 3 Commercialization Support for Business Program Guidelines

4 Design of digital marketing materials Ineligible expenses: Branding activities Advertising Printing of marketing materials Costs of marketing giveaways and samples B2B Consultants Web page development and upgrades Marketing strategy development Ineligible Costs Streams 1 & 2 Costs and activities not associated with the project or reaching agreed upon milestones will be ineligible for reimbursement. These are: Advertising Land and buildings Equipment Inventory Research and Development Travel and entertainment expenses Financing charges and taxes Website development Business plans Activities relating to productivity improvements Application Evaluation To be considered for funding, eligible applicants must: Meet the definition of a sole proprietor or business entity; Demonstrate the presence of an unaddressed market problem via market research and how the product or process solves that problem; see the Market Validation Guidelines. Demonstrate their proposal meets one or more of the following Program objectives of being innovative: o Something that is new and disruptive in the market place (not currently manufactured in Manitoba); o The process of turning new ideas into new products, processes, or markets that create commercially viable opportunities; o Improvement to a product or process that the market did not anticipate; o The introduction of a product or service into a new market; o New ways of doing things that add value to the user. If determined eligible to enter the Program, all applicants, regardless of stream, are required to submit the necessary information, as per the requirements of each funding stream. Merit of each proposal will be based on the following criteria: 4 Commercialization Support for Business Program Guidelines

5 Meeting one or more of the above Program objectives; Evidence of financial capacity to cover the proposed activity costs; Soundness of the business case Financial Capacity: At the time of application, applicants must demonstrate their ability to fund the project. In addition to providing the company year to date financial statements (income statement and balance sheet), applicants will need to provide information to support their ability to fund their project. This may include; company or personal bank records, letters from financial institution confirming loans, lines of credit, or other forms of proof of financial position. Application Process: The program provides one time support to companies under 1, 2 & 3 up to the maximum of each stream. Total funding is capped at $250,000 per company. For example if a company received $30,000 under Stream 1, it may only receive $220,000 under Stream 2. Each request will be evaluated against Program criteria. Only complete applications will be considered. Incomplete applications will be returned to the address from which the application was submitted. A complete application must contain the information required in the application form. The applicant will be notified by of the Department s receipt of the complete application. The date of the will serve as the beginning date of the application review. Submit only one application indicating which funding stream(s) you are applying for. Stream 3 is a standalone stream and may be applied to separately, or in conjunction with Stream 1 or 2. You must apply to and achieve the outcomes of Stream 1 of the Program in order to apply to Stream 2. Applicants will be notified regarding the status of their application within 3 business weeks of the submission of a completed application. Completed applications must be ed to csb@gov.mb.ca. Funding Disbursements: Reimbursement is based on invoices and proof of payment in full (cancelled cheques, credit card statements, bank statements, etc.) incurred in accordance with the terms of the Contribution Agreement. Information on the reimbursement process will be included in the Contribution Agreement. Reimbursement under the Program is not retroactive. Applicants whose projects are approved will be able to claim expenses back to the date of receipt of their completed application. Applications under Stream 2 will be evaluated for scalability by an Advisory Council and in some cases these contributions may be repayable as per the Innovation Act. Funding recipients under Stream 3 will be provided with a trade show outcome questionnaire at the time of funding approval. The questionnaire can be found here as a word document. The questionnaire must be submitted with the reimbursement documentation mentioned above for the claim to be processed. Funding 5 Commercialization Support for Business Program Guidelines

6 recipients need to also provide pictures of their booth at the tradeshow and provide a copy of the marketing materials developed with the funding assistance under the CSB Program. Reporting: Recipients of funding under Streams 1, 2 & 3 will be contacted annually for a period of five years as part of a longitudinal project review. The review will be in the form of telephone or in-person interviews to follow up the project and measure overall company growth by using such methods as financial statement reviews and collection of company issued T4 s. Details on what information will be collected will be outlined in the Funding Contribution Agreement. 6 Commercialization Support for Business Program Guidelines