In this series, we featured southerners who bought a cottage resort in Northern Ontario and have no regrets. After listening to these episodes, maybe you're ready to make the leap, in theory, but the actual dollars and cents are holding you back. If that's the case, tune in to this episode about one of the North’s best kept secrets: Community Futures Development Corporations. CFDCs are nonprofit funding organizations that offer sizable loans with generous repayment terms, even to businesses considered too “risky” by the banks.

Our guest for this episode is Ryan Raynard, the Chair of the Northwest CFDC Network and the Executive Director of the Lake of the Woods Business Incentive Corporation (LOWBIC).

Find a CFDC office in your community:

• Community Futures Ontario: Northwest Region 
• Community Futures Ontario: Northeast Region 

For more information about buying a cottage resort from a retiring owner, visit successionmatching.com.

Learn more about tourism investment opportunities in Northern Ontario at invest.destination northern ontario.ca. Follow us on Twitter, Facebook, Instagram, or LinkedIn.

About the Destination: Northern Ontario podcast

If you came across a real estate listing for an affordable cottage resort deep in the boreal forest, would you be tempted to buy it?

If the answer is yes, then the Destination: Northern Ontario podcast is for you. By the end of this five-part series, you’ll learn everything you should know before buying or starting a tourism business in the north, and hear stories from people who’ve walked the path before and would do it all over again.

The podcast is hosted by Michelle Samson and produced for Destination Northern Ontario by Storied Places Media.

I mean, I think, we're the best kept secret in our communities.

we don't always do a great job of, promoting ourselves, uh, telling

the great stories, but, each CF has done fantastic work within

I'm Michelle Samson host of the destination Northern Ontario podcast.

This series is for the dreamers who want to start a new life somewhere

simpler, somewhere that for the price of a condo in downtown Toronto,

you could buy a cottage resort.

That would be your business and your home.

The trail to your new life isn't necessarily paved and easy, but it has

been walked before with great success.

In the past three episodes, we featured cottage resort owners who

walk the walk and have no regrets.

Episode two featured a couple who traded their big house in Collingwood

for a fixer upper and Algoma.

In episode three, we talked to a couple of Northern Ontarians who

bought their favorite hunting lodge.

And episode four was about a newcomer family who had no experience

with cottaging, but are thriving.

We help.

These success stories have been inspirational.

Maybe you're ready to make the leap in theory, but the actual dollars

and cents are holding you back.

If that's the case, then this episode is especially for you.

Across Northern Ontario.

There's a network of nonprofit organizations called community

futures development corporations, which are sometimes called CFD CS

or shortened even further to CFS.

Their mission is to help small businesses start up and thrive

in rural and remote communities.

Like the ones across Northern Ontario.

One of the most special things about CFS is that they're willing

to offer loans to businesses that the banks consider too risky.

Plus they have flexible and generous repayment schedules.

I know what you're thinking.

What's the catch, right?

I sat down with someone who can explain.

Ryan Raynard is the chair of the network of CFS across Northwestern,

Ontario, and the executive director of an individual CF the lake of the

woods business incentive center.

To ease into this discussion, asked him to explain what his organization does.

Sure.

So we're a community future development corporation.

Uh, we're a nonprofit funded by Fedor.

and we're a business development and lending service.

So we provide, uh, business counseling.

We provide lending services to entrepreneurs and small business owners.

They also lead community development projects,

which we'll get into later.

But the core of what they do is business development.

They serve lots of different kinds of entrepreneurs.

We've seen, entrepreneurs coming through that are

just getting into business.

We've seen existing business owners that are looking for, maintenance

funding or expansion funding.

So, um, your local community futures office is there to help

the small businesses in, in the communities, we cover the gamut.

for those expansion projects, would they have to

be working with you beforehand or could they come to you fresh?

No, they can come to us fresh.

you don't have to be an existing client.

And as well, if they just wanna come and get some business counseling advice

from us, there's no cost to that.

we don't charge.

they can come in and get a little bit of advice and then work with traditional

lenders on, whatever their game plan is.

As mentioned before, one of the big differences between a CF and a bank

is that a CF will take on higher risk.

Startups that were rejected by a traditional lender can often still get

funding from the CF so long as they have a reasonable expectation of success.

This gives the startup an opportunity to get off the ground and prove their model.

Once that happens, they can transition to the traditional lenders.

CFC are able to take risks because they're a nonprofit funded by the federal

government for exactly this reason.

we're designed to take on that risk and develop our economies.

we wanna make sure that small businesses in our communities thrive.

that's Our mandate.

So we want to see, the small guys and the medium-sized guys as well.

succeed.

We wanna see them develop their business and, eventually move

on to the traditional lenders.

So it's a rotating, uh, pool of money, right?

Startups that we will develop.

They'll go to the bank.

The bank will pay us out, and how we have that money to, invest in a new business.

So how big of a loan could you get from a CF?

It varies.

There are offices across Northern Ontario, each one governed by a local board of

directors who decide how much the loan will be up to a maximum of $300,000.

However, there's a way to borrow more than that.

The CF offices can pool their funds with other offices in the region.

The Northwest region investment pool can lend up to $600,000 in the

Northeast where there are more offices.

That amount goes up to $750,000.

For the business.

This is money that can be leveraged for loans elsewhere.

We encourage, business owners and entrepreneurs to look

at other alternatives as well.

We partner with the traditional lenders, the credit unions, the BDC, NOHFC.

we'll work with anybody to make, deals work in our

Sometimes the investments from the CF can help make the calculations

work at the banks so it, counts as equity with Their lending, services.

So I would encourage, any business owner that's, thinking

about utilizing our services.

Just go talk to your local cf.

there's no commitments, there's no cost to it.

Just go have a conversation and they can explain how the CF can be

a part of that lending solution.

And will you facilitate that or will you just sort of

point them in the right direction?

Oh no, we've, sat down at the table with all the players and, have

an honest conversation on how we can help and how we fit into the puzzle

and making it work business itself.

Now that's service.

Maybe at this point, you're intrigued, but still a little unsure because you've

never applied for a business loan before.

I asked Ryan to demystify the process by walking us through every step.

Sure.

So, uh, each CF has a lending officer.

And the business, uh, or the entrepreneur can come down and just have a

conversation on how to get started.

The lending officer will sit and talk to them about what's required.

They'll talk about, all the documentation that might be needed,

and then, walk them through each stage.

the pre-application, it's just gathering all the information,

understanding what's needed.

The application stage where they fill out the actual forms, Once

that, uh, loan application is filled, depending on the, the CF office,

either the board of directors or staff will look at, the loan itself

and make a decision on, feasibility.

From there, it's, a yes or a no.

And if it's declined, they'll be given some reasons as to

why some of the deficiencies.

And in some cases, there's clients that will work on those and come up

with different solutions and they can reapply and they may get approved

or it's just outright approved and they're, given the money to, proceed

with their project and their dreams.

Could you talk a little bit about, some of the reasons why

you might, not offer for a loan

Yeah, so we have seen, um, cases where we will decline alone.

certainly don't want to set somebody up to fail we're professionals.

We're from the communities that we work with.

So we know, not everything, but we know a lot of what's gonna, be possible

and what's not gonna be possible.

So if there's unreasonable expectations as to the.

Revenues that they think they're going to make.

Maybe the individual, is not the right person for that business.

Or if somebody's maybe putting their house up for security and we just know that

this business is, not gonna succeed, and we don't wanna put them in a bad place.

it's, both a, a fiscal responsibility to the, taxpayer and the federal

government, because that's where our funding comes from.

And as well, it's to the individuals themselves.

We, we don't wanna see them get hurt.

And then what does, uh, repayment look like?

Yeah, so that's one of the other things that we can do.

we have flexibility with repayments, so depending on the situation, if it's

a seasonal business, like the tourism ministry, uh, we can set up seasonal

payments where in the summer where you're generating a lot of that revenue, we

can do principal and interest payments.

In the winter, when obviously things are a lot slower, we

can just go to interest only.

So there's these things like that.

Or we can do, know, interest only payments for a certain period of time.

We can delay.

obviously the interest is accruing, so you wanna be careful as to

how much you're delaying that.

But we have the flexibility to, work with the business and come up

with a solution that's best for them.

And as well with our program, the loan can be repaid at any

time without penalty . So if.

For whatever reason, you have an extremely great summer.

You've got a lot of cash sitting on hand.

You can make lump sum payments, or you can pay off the entire loan

. Michelle: And is there an upper limit

within the next X number of years.

Generally, 10 to 15 years is about, the max amortization,

timeframe that we will look at.

All right.

since this podcast is very much about tourism, I'd like to pick your brain

on what you're seeing in the industry.

have you noticed any trends in tourism?

development or expansion or, anything that's jumping out.

Yeah, so obviously with Covid we saw, some of the camps go to business.

there's a lot that still rely on the us especially up in our area, um,

There is a return uh, in our area we're seeing a lot of the, higher

wealth, US travelers still coming.

At a lot of the.

fly-in resorts.

So it's that higher end traveler that's, coming up.

Some of the rubber tire stuff, so some drive to camps.

I think some of those are struggling a little bit.

the market hasn't completely returned to the pre covid levels.

that's a challenge that, the camp owners are looking at how do they excite

Canadian travelers in terms of trends though, there's some, camp owners that

are approaching the retirement stage.

So we're starting to see some of these camps transition that have been with

the same owners for many years good in one way because we've got some new

people coming in with fresh ideas and looking at what markets they can attract

Through their free business consultations, the CS can offer insights

and advice to keep occupancy rates high.

And all of the owners that we profiled in episodes, two, three, and four

of the series have been examples of applying fresh ideas to an old camp.

They upgraded the resorts, made them Airbnb ready and invested in

social media to reach new markets.

So go and check those out for some ideas.

That to the point on camp owners approaching retirement.

It's a big issue for Northern Ontario tourism because it means that those

accommodations could disappear and visitors who want to spend a

night or a week up here might have trouble finding a place to stay.

To make sure that doesn't happen.

The CFS are helping these owners prepare for and sell to buyers.

In some cases, they get involved in the transaction itself to help close the deal.

I'll just give a generic, example, but, for instance, uh,

there's a camp owner that, maybe is looking at selling their business.

So they've got a potential buyer, that buyer can't quite get all of the funding

that they need from a traditional lender.

That's where we'll step in and we'll take a second or a third place on security.

We'll work with the traditional lenders and even if we can't come up with a

full amount, then we'll facilitate with the seller and the buyer.

we may have the buyer, agree to take a vendor, takeback.

So that's where they would provide a small loan to the

purchasers to help close the deal.

To further support these kinds of transitions.

The CFOs across Northern Ontario have partnered with succession matching.com.

An online community of business buyers, sellers, and succession

planning professionals.

One of its key features is a platform where you can browse

businesses that are for sale.

But it offers much more than that.

They provide a lot of information on, the process.

They've got webinars and a big part of their website as well as

there's an online marketplace.

You have to pay for a membership to get on there.

So it's not just, random people browsing through the businesses that are for sale.

you're vested and you, have a reason to be on that, marketplace.

So far, most of the focus has been on recruiting sellers.

we're putting on a series of events, that provide business

succession planning information.

it's, designed to just get them thinking about the process because

far too often, succession plan is something that's forgotten.

It's not really thought about until, oh, I need to sell my business right now.

Or, unfortunately, if, an owner gets sick and, there's, a need

to sell that business very quick.

Well, a lot of things, can get missed in there and you're not maximizing the

value that you can get for your business.

it's been a, a very good, uh, process so far.

It just started, in January of this year.

And, we've already gone to 15 communities.

we've had nearly a hundred participants come out.

And there have been some, successful purchases of businesses.

So that's been, very positive.

So that was about getting sellers on board.

If you're thinking of buying a business in Northern Ontario,

Ryan definitely still recommends checking out succession matching.com.

it will allow them, an opportunity to see all of the businesses that

are for sale it's not a lot of cost and it, gives them, outstanding.

Selection in terms of what's out there.

And again, I think the folks at succession matching have done a great job of, working

with both buyers and sellers to help facilitate and make those deals happen.

are there any properties that are listed there that wouldn't be on

like the general real estate websites?

Possibly, what we've seen with some of the business owners that, have come

out to our events is they may not wanna list their business for sale publicly.

they don't want people in their community to know they're for sale just yet.

so there's different security levels, so it can be posted, as.

anonymous business almost.

And, that allows that they can continue to operate in their community without

fear of, people thinking that they're closing down or something like that.

so yeah, there are businesses that could be for sale on the marketplace

that, necessarily for sale in the paper

So that's what community futures, development corporations are

all about and how they can help you buy and expand your very own cottage resort.

Are you surprised that these non-profits exist or that

they offer all these services?

You aren't alone.

I mean, I think, we're the best kept secret in our communities.

we don't always do a great job of, promoting ourselves, uh, telling

the great stories, but, each CF has done fantastic work within their

communities, and I would, guess that probably half the businesses in each

community have probably, touched on the CF services at some point.

throughout their life.

again, if there's anyone that could potentially, utilize the services

of the Community Futures programs, I would highly recommend that

they go in and just have a chat or email or, text their, local office.

and again, there's no obligations.

Uh, they can just have a conversation about what they're looking for and whether

or not the CF is, able to help them.

we're there to help and, we're excited, anytime that we get some new folks

interested in Northern Ontario.

Having a chat with any of the community futures development

corporations is a great idea.

If you don't have a particular property or community in mind yet.

Then a great place to start for pan regional advice is

destination Northern Ontario.

Look them up at invest dot destination, Northern ontario.ca.

Well, that concludes our podcast series for now.

Anyway.

What did you think?

Was it helpful?

We'd love to know.

Leave us a rating or review or reach out to DNO directly.

New episodes could appear in the future to make sure you don't miss them subscribe or

follow on your favorite podcast platform.

I hope we meet again.

The destination Northern Ontario podcast is produced by storied places,

media and hosted by me, Michelle Samson.