Pathways to Financing Black Entrepreneurs

Small and medium-sized enterprises (SMEs) are central to the Canadian economy, driving job creation, innovation and economic growth. For Black Canadians, who make up 4.3% of Canada’s population, entrepreneurship represents an opportunity for economic independence, community development and generational wealth accumulation. Black self-employment increased from 3.16% in 2024 to 3.53% in 2025, but this is still below the Black share of the Canadian population. Despite the increasing number of Black entrepreneurs, they still face numerous challenges, especially barriers that limit access to financing. Lack of financing limits the growth of Black-owned businesses at each stage of their development and limits the participation of Black entrepreneurs in Canada’s business ecosystem.

Black entrepreneurs face numerous barriers in accessing financing, which results in Black entrepreneurs using on average 67%, or $72,000, less start-up capital compared to white entrepreneurs ($35,000 vs. $107,000). The gap in funding widens as their business grows in subsequent years. Financing is similarly limited for scale up; recently published data by a Black-led Canadian venture capital (VC) firm, suggests that Black led businesses receive approximately 0.8% of Canadian VC funding.

There are encouraging signs that Black entrepreneurs are receiving greater support. In 2025, the Government of Canada announced a five-year extension of the Black Entrepreneurship Program with $189 million in additional funding. There are increasing numbers of programs and initiatives meant to address barriers to funding that Black entrepreneurs face.

Read this short report for insights into the continued barriers to financing alongside success stories to suggest pathways to making financing more inclusive for Black entrepreneurs. Addressing these barriers is more essential than ever given the economic uncertainty that Canadian businesses face. Providing better access to financing will support not just Black entrepreneurs but all Canadian entrepreneurs — who are increasingly diverse — as they try to adjust to the rapidly changing economic conditions.