AFO · Construction & trades
Equipment, holdbacks, and the working-capital squeeze.
Construction and trades businesses share a tough working-capital profile: equipment-heavy balance sheets, long holdbacks on completed projects, and lumpy payment cycles tied to the general contractor's release schedule. The right capital stack matches the structure of those cash flows, equipment finance on the asset side, factoring or ABL on the receivables side, and CSBFP underneath both when the business qualifies.
What makes this industry vertical distinct
- Equipment finance + CSBFP equipment stream sized together.
- Factoring vs ABL chosen on deal size and AR-ageing profile.
- CSBFP real-property funds the shop, yard, or warehouse purchase.
How the capital stack works for construction & trades
Construction & trades, in practice.
Equipment is the first capital conversation. CSBFP funds equipment + real property up to a combined $1,150,000 at Prime + 3%, usually the cheapest dollar for an owner-operator buying trucks, machinery, or a shop building. Above the ceiling, conventional equipment finance and leases handle the rest at 75 to 90% LTV on the asset itself. Mixed-fleet operators (trucks, trailers, attachments, light equipment) often run a single equipment line with the equipment lender rather than collecting separate facilities per asset class.
Receivables and holdbacks are the second. Sub-trades waiting 60 to 90 days for progress draws (and another 30 to 60 days for holdback release) are a clean fit for invoice factoring, 1 to 4% per invoice, cash in days rather than weeks. ABL revolvers work for larger contractors with strong AR ageing and inventory of materials, advancing 85% on eligible AR and 50 to 65% on materials inventory. The choice between factoring and ABL is driven by deal size and customer-credit profile, not by the trade itself.
CSBFP real-property handles owner-occupied real estate (the contractor's yard, the shop, the warehouse) up to $650,000 of the combined $1,150,000 ceiling at Prime + 3%. Above that, conventional commercial mortgages take over at 65 to 75% LTV with coverage tested on the combined property + operating business cash flow. Regional development agencies fill the local-economic-impact layer where a project (a new shop, an expansion into a new town) qualifies under the agency's program criteria.
6 programs in the catalog · 5 live
Programs that fit construction & trades.
Curated by underwriting profile, not by tagging, each card links to the program profile. Coming-soon programs are surfaced honestly: the screener routes there with a consultation CTA instead of a self-serve apply link until the integration is wired through.
Government-backed term loan for equipment, leasehold, and real property. Up to $1,150,000.
Equipment-specific term loan or lease at 75 to 90% LTV on the equipment.
Immediate cash against outstanding receivables. Suits B2B businesses with long DSO.
ABL Revolver (Asset-Based Lending)
Coming soonRevolving line tied to eligible receivables and inventory. Scales with the business.
Cash-flow-underwritten facility from a chartered bank, credit union, or Schedule II lender.
Interest-free repayable federal funding for scaling businesses, delivered regionally by ACOA, FedDev Ontario, PrairiesCan, PacifiCan, CED-Q, and CanNor.
Common stacks for this vertical
The combinations a CPA usually assembles for construction & trades.
A stack combines two or more of the programs above into a single capital-structuring answer, equipment + working capital, non-dilutive R&D, grant + debt. Each card names the programs AND the role each one plays.
- 3 layers
CSBFP + working-capital line
The single most common owner-operator capital stack in Canada layers a CSBFP equipment + leasehold loan with a conventional working-capital revolver. CSBFP covers the asset purchases at the cheapest available rate (Prime + 3%, government-guaranteed); the revolver handles the AR + inventory cycle. The two facilities never compete for the same dollar, they fund different parts of the business, but the package needs to be designed together so the lender sees a coherent overall ask.
Read the stack
- 8 layers
Manufacturer growth stack
Manufacturers carry hard assets, long working-capital cycles, and a programmatic R&D spend, three traits that open distinct funding pools in the Canadian system. The default growth-stage stack layers equipment finance (the asset side), ABL or senior revolvers (the working-capital cycle), and the non-dilutive R&D layer (SR&ED + IRAP + Clean Tech ITC where applicable). Each piece is independently underwritten but designed against a single business case so the lenders and the grant programs see a coherent overall plan.
Read the stack
Other industries
Different industry, different stack.
Each vertical has its own structuring conversation. A manufacturer’s balance sheet drives a different mix than a SaaS company’s payroll-heavy R&D, the programs that fit each shouldn’t be the same.
- 6 programs
Professional services
Professional-services firms (accounting, law, engineering, consulting, design, healthcare practices, agencies) share a hard underwriting profile from a conventional lender's perspective: low hard-asset coverage, payroll-heavy fixed cost, lumpy project economics. The right capital stack works around that profile rather than against it: leasehold financing where the asset is the office build-out, equipment finance for tech and infrastructure, and structures that underwrite on cash flow rather than collateral.
Explore the vertical
- 12 programs
Manufacturing
Manufacturers carry hard assets, long working-capital cycles, and a programmatic R&D spend, three traits that open distinct funding pools in the Canadian system. The hard assets unlock equipment finance and asset-based revolvers; the working-capital cycle drives the ABL or factoring conversation; the R&D spend pulls SR&ED, IRAP, SIF, and Clean Tech ITC into the stack.
Explore the vertical
- 8 programs
Technology & SaaS
Tech and SaaS businesses have an inverted balance sheet: little hard collateral, lots of payroll-heavy R&D, recurring revenue that scales faster than the company can self-fund. Most conventional debt structures don't fit. What does fit is the Canadian non-dilutive stack (SR&ED, IRAP, SDTC, digital media credits) followed by revenue-based financing on the working-capital side and equity only when the round is the right use of capital.
Explore the vertical
Match the structure to the industry, not the other way round.
Twenty-minute call. Bring the business profile and the project; we’ll walk through which programs in this vertical fit, which grants and credits stack underneath, and how long the engagement takes.