Funding for a Canadian-based business?

searcher profile

October 01, 2025

by a searcher from University of Texas at Austin in Leander, TX 78641, USA

After multiple meetings with the seller of a Canadian-based business (though it's operationally remote and has employees in both Canada and US), I'm nearing a signed LOI. Has anyone had success in either: 1) Working with an SBA lender to loan on a Canadian business 2) Successfully relocating a non-US based business to the US to then qualify for SBA lending? 3) Sourcing funding through alternative providers to SBA (SBIC, private funds, etc.) I've been pre-qualified through an SBA lender at more than enough to purchase this business, and have also run it by my current SBIC contact, though it's under their minimum threshold (purchase price for this likely around $4M). The Canadian entity is proving to be a bit of a challenge. Would be great to hear from others who've navigated this. Also very open to referrals to lenders outside of SBA, who are familiar with lending on similar geographic components. Thanks!
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commentor profile
Reply by a professional
from University of Saskatchewan in Calgary, AB, Canada
Hey Justin, I am a Canadian-based lawyer and have assisted US based searchers in the past, that tried to utilize SBA. There may be some nuance to your deal specifically, but if it has a physical presence in Canada you will not generally be eligable for SBA. You may however be eligable for a BDC loan, or traditional bank financing infrom a Canadian domiciled bank, depending on your plans for the business - I have seen US based searchers obtain Canadian bank financing in the past. Happy to chat further - redacted
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Reply by a searcher
in Austin, TX, USA
I don't believe the SBA lends to foreign companies, so private investors or lenders are likely your best option. You should also consider the cross-border tax implications of the acquisition. For instance, will you shut down the Canadian operations, or will you structure the deal as a U.S. company acquiring the Canadian business and maintaining it as an operating subsidiary in Canada? Check for Exit tax if it is applicable to Canadian companies like it is for individuals.
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