133: How the BDC Supports Canadian Entrepreneurs & Small Businesses with BDC's Amanda Price

00:00:00 Taylor Atkinson
All right, welcome back to the Kelowna Real Estate Podcast. I'm your mortgage broker host, Taylor Atkinson.


00:00:03 Matt Glen
And I'm your commercial broker host, Matt Glen. What's happening today, Taylor? Your kid's in day scare? Day scare. Yeah, nice one.


00:00:10 Taylor Atkinson
You've been using that a lot. Is that on the whiteboard there? Yeah. I feel like they're always in day scare, man. Yeah, it feels like we haven't recorded an intro for a while because,


00:00:19 Matt Glen
for a while because, man, there has been a lot going on. Okay, are we going to touch on the provincial election? We haven't even talked about the municipal election. So municipal, provincial,


00:00:27 Taylor Atkinson
Bank of Canada. Let's start with municipal. Yeah, Tom Dyas is continuing to be our mayor of Kelowna. I think it was the closest mayor race in the province.


00:00:34 Matt Glen
think it was the closest mayor race in the province. Kind of crazy. You know what? We've had them both on the show. Honestly, both good options. Like both have strengths. Yeah, we're fortunate in Kelowna. It was kind of funny with the election that like both of them were like such prominent on like the last council that like whoever lost was just not there anymore. It's not even like they're just going to be a councilor. So it's kind of interesting. Well, and quite a few new seats on the city council. Yeah, my man Davis Kyle. Man, at the top and then Lovegrove kind of took away the most votes. That was pretty good. And then Brady Rogers, like viral sensation from Kelowna. Viral sensation. Yeah. Yeah. It's pretty crazy that he's gotten so much attention and like, I think it's good for Kelowna, like for us to kind of see more behind the scenes once the thing's going with having such a prominent like social media presence on that.


00:01:24 Taylor Atkinson
Yeah. I'll be transparent on my view, like, you know, six, seven weeks ago when he kind of first started his campaign, saw it as more of a, yeah, social media influencer, like, you know trying to have some fun with it a bit of a joke and I was like I don't know if he's really going to take it seriously but as his campaign evolved and I think maybe it was like a bit of a pivot for him as well I'm just guessing is like once he started to see some traction he's like oh maybe I can actually make a difference here and add some value and a different opinion and yeah as the last couple weeks kind of came out for closing I was like you know what I think he'd be a pretty good counsel to be there and ask the questions that have maybe not been asked in a few years and provide some social media content to younger voters. So yeah,


00:01:39 Matt Glen
I don't


00:02:07 Matt Glen
I'm happy with him taking a seat. Me too. Also, it's kind of interesting because like he was viral, but he wasn't viral for like... doing crazy shit. Like he was viral because of the campaign and he got a social media attraction because of the issues he was bringing up on his social media, like all Kelowna issues. And like, he was kind of viral for the reason why he got elected. You know, it wasn't just like some random thing that he morphed into getting a seat just for that reason. So yeah, I think, you know,


00:02:29 Taylor Atkinson
we'll see how it goes.


00:02:30 Matt Glen
it goes. Two prong approach.


00:02:30 Taylor Atkinson
approach. Like some of his videos were hilarious. I love them. But the other side, like his interview with Tom Dias and Ron Cannon. Great interviews. Like if somebody didn't watch those prior to voting, I think they should have. Like it was awesome to kind of have those real conversations and ask hard questions. And even when he was kind of getting the political answers of like not answering it directly, he would just circle back and kind of ask it again and again. And yeah, from a city council mayor point of view, yeah, couldn't be happier. Kelowna is in a good spot. Provincial. Bit of a landslide by conservatives,


00:03:04 Matt Glen
of a landslide by conservatives, man. So, like, I just assumed, like, even before the election, my wife, Becca, was like, man, it seems like the conservatives are going to win. I'm like, yeah, but, like, Eby wouldn't call an election if he was just going to get absolutely cooked. Like, he must know something. And then, nope, didn't know anything, got absolutely cooked. Like, are you kidding me? I thought it was going to be tighter, for sure. Oh, my God. And then, like, that is... one of the biggest straw balls in BC political history. Like, it's got to be crazy. Yeah. Like, you have two more years of a majority government. Now you're not even, like, it was your dumbass decision, but everyone did. You know,


00:03:37 Taylor Atkinson
know, like, are you kidding me? I totally agree. And, like, honestly, when he called the snap election, I was like, even if you voted NDP last time, would this not kind of piss you off enough to go conservative even if you were on the fence before? Which I think is what happened.


00:03:47 Matt Glen
if you were on the fence before? Which I think is what happened. A lot of the NDPers didn't vote. They're like, man, like, this is crazy. I've been voting. So like, I think that the votes were actually down and conservatives actually got less votes than they did the last election, but the NDP got way less.


00:04:02 Taylor Atkinson
Well, I mean, I think it also shows, we talked about this when Steve Johnson was on the podcast, like conservatives rallied quickly. They organized, like they were ready for this. I think in the back pocket, they kind of knew, hey, if this happens, we need to be prepared. But did you watch Lauren's speech? Like his acceptance speech was awesome. I loved it. It was just so like authentic. He's from the North. He like listed every community in BC. Like to me, it just seemed like it wasn't a politician type speech. He was just like excited. You know, he's like, I'm ready to shake everyone's hand in the room.


00:04:32 Matt Glen
ready to shake everyone's hand in the room.


00:04:33 Taylor Atkinson
I'm ready to get to work. Like, whereas, you know, Evie, I think honestly, man, he's just been run down the last couple of years. Like you see them side by side and one guy has like decent posture and is excited to get to work and the other guy's just slouched over like depressed.


00:04:48 Matt Glen
Well, he just made incredibly stupid decisions. Like the tax on unsold condos has got to be the dumbest decision. Even to make it as a proposal is just completely stupid. Well, yeah, every policy that they've come out with. Well, some of them I think can be defended, but that one is just like so outrageous. It's like, man, we need more housing. So what we're going to do is we're going to bring the hammer down on the only people building housing. You know, like, it's just like, are you kidding me? That alone is just such an irritant. Yeah, I think it was kind of just a little bit. It is kind of just to stay on this topic for a second, like the last two elections seem to be more lost than one because like the Kevin Falcon fiasco was just like also crazy right before the last election. And this one, it feels like both of the last elections were not as much won as in lost by the other party, right? Yeah. What do you think about that? Yeah,


00:05:42 Taylor Atkinson
no, that's fair. Especially the last one. Like how BC United did a name change, caused confusion, then folded, then like just an absolute disaster. And then same with this snap election.


00:05:53 Matt Glen
election. Yeah. So yeah, interesting times. And then yesterday, big news in real estate world is rates first time since 2023 on the way up again. Yeah, so 25 basis point increase.


00:06:03 Taylor Atkinson
so 25 basis point increase. Obviously, if you have a line of credit or a true variable mortgage product, there are variable products that have like a static payment associated to it. So in that case, your payment will not change, just more will go towards interest, less the principal. Like I've been saying this for the last six months, same when we're speaking with Brendan Augmentson, like, hey, in the next kind of 12 to eight months, we'll probably see that. quarter point to half a point rate increase. Bank of Canada has kind of been handcuffed, right? Economy is not strong. GDP is low. Job numbers are low. But inflation has just been like, not trending upwards substantially, but it's been on that upper end, especially because oil and gas, specifically with, you know, overseas conflict. So I think they maybe have been pressured to do this at almost the last couple announcements and just have held off because where we are at. economically. It is what it is. I'll air my frustration a little bit is I find for me, and maybe I shouldn't say this, but for me, some clients will get super frustrated. Like, oh my God, the rate's going up. It's just chaos. My payment, blah, blah, blah. And it's like, okay, take a breath. You also just had the lowest rate product for the last year and a half, two years. You rode that wave down. Just because the rates now going up, like you're still below a lot of the fixed rate products, like fixed rates are substantially higher. So again, if you're in that product, you just need to be able to like breathe through it, you know, take that little bit of volatility and know that, hey, you just had a lower payment for the last year and a half, two years. Like, so in those scenarios, I feel that.


00:06:40 Matt Glen
because oil


00:07:39 Taylor Atkinson
If we didn't just spend the money and people either took the extra savings and put it in their TFSA or prepaid their mortgage down, then this wouldn't be such like a frustrating shock. And obviously the conversation is if people cannot handle that volatility because they want that lower rate product to begin with, then obviously go with a fixed rate product. But most of the conversations I had were like, Hey, you can either go with a variable rate that's about half a percent to like 0 .7 % cheaper than most fixed rates over the last few months. And even now the spread's still quite big. So yeah, anyways, long story short, I think just we can't get caught up in the hype of the media and there's a bit of a clickbait behind it. Obviously you have to be comfortable with payments shifting, but I would suspect like we might see another quarter point rate increase over the next little bit. It really just depends where we are. you know, economically and how inflation is being treated. Yeah, makes sense. Okay, well, today's show to talk a little bit about, you know, Canada's economy. Getting things going. We had Amanda Price on from BDC, so Business Development Bank of Canada. It's a federal corporation that supports Canadian entrepreneurs and small business owners. So basically, it's backed by the Canadian government. Their policies are really just to help small business owners and entrepreneurs drive business by funding. So they provide capital to those ventures and they also provide advising and coaching. So really cool job. Like I was super interested by the conversation because she gets to. analyze people's business ventures and see if they think they're viable or not and invest in them and help them grow. So yeah, really cool conversation. If you have any questions, if you're an entrepreneur, a tenant looking to do like lease improvements or just, you know, start or grow, expand a business, awesome resource. Buy real estate too. Like they can do up to a hundred percent financing in certain situations.


00:09:24 Matt Glen
Buy real estate too. Like they can do up to a hundred percent financing in certain situations. So it was great having Amanda on. Like I met her a few times before the show and she's good to talk to, but Matt, she is a wealth of knowledge. It's wild.


00:09:34 Taylor Atkinson
Yeah, I think especially in your world, right, where you have commercial tenants looking to try and secure a lease and start a business, but they may not have the history or a financial institute that's willing to back them. This is just an awesome resource.


00:09:49 Matt Glen
Yeah, like a government -backed bank for small business. Yeah, man, it was awesome to talk to you too about it. So this was a very informative episode, especially for what I've been doing. So it was a good one for sure.


00:09:59 Taylor Atkinson
Yeah. And I mean, relevant if... Like we just had municipal election, provincial election, lots of changes with policies. There's going to be different programs coming out, different economic directions we're going. So yeah, good timing for us. like we planned it. Obviously, we want to highlight one of our newer sponsors, ARG. Yeah, we're happy to connect with them and work with them on this project. So if you're looking for a home builder that brings inspiration, honesty, craftsmanship, reach out to Adam at ARG or go to ARGHomes .ca. They're looking to transform your vision into reality today. And our other new sponsor is my brokerage,


00:10:34 Matt Glen
our other new sponsor is my brokerage, Venture Commercial. We are the biggest commercial only brokerage in town. Retail, industrial, office, like do all the commercial land acquisitions, obviously all that kind of thing. Like we mentioned our last show, our signs are everywhere. Increasingly more of them have my name on them, which is fantastic. But yeah, it's a great brokerage. Everyone here is awesome. It's a great environment to be a part of. And like, just, I feel like also doing right things in the community. Like we're involved in so many events. We have Christmas events coming up and yeah, it's just been an awesome experience for me, but also for what I've noticed. The client's coming in here too. So Venture's on the right track. Super happy to have them as a sponsor of the pod.


00:11:14 Taylor Atkinson
Yeah, I love it. Well, I'm still waiting for my, you said there's a Christmas event. Do I get an invite to this? Yes, you do. Yes, you do. All right. Well, this is a long intro, but there's a lot to cover. Yeah, we're getting older in life. So we're super excited about political stuff now to talk about. But enjoy the show, guys. Amanda's an awesome resource. Reach out if you have any questions. Enjoy the show, you guys. It's a good one.


00:11:40 Taylor Atkinson
Okay, Amanda Price, welcome to the show. Thank you for coming.


00:11:44 Amanda Price
Thank you very much for having me.


00:11:46 Taylor Atkinson
We've been trying to get you on for a while, juggling schedules. I was introduced to you maybe six or seven months ago. You were extraordinary in helping a client do a shareholder buyout in a company that I was working with. And yeah, I thought it would be awesome to bring you on the show. So can you tell us a little bit about yourself and the company you're working with? Sure.


00:12:06 Amanda Price
So my title is a senior account manager. I'm a CPA by background, so I was in public practice before. I worked as a CPA in industry, in building development, and a few other realms, hospitality as well in Kelowna here, and decided I wanted to get back into, I guess, more of a client -facing role, something with a few different growth horizons there that I can work with, and other kind of mentorship and coaching opportunities as well. beyond what necessarily an in -house business could provide. So I guess five years ago now, I ended up over here at BDC in my first kind of jump into the banking arm of things. And that really brought together a lot of my background. So from the financial statement analysis and preparation side of things, working with business owners. back then. Tax preparation, all of that, kind of understanding how all of those things work together and then having been in businesses before, looking at the financing side, trying to get that and then developing businesses from there and building and doing capital assets and all of that. That's really kind of honed in what I'm able to offer over here at BDC. So BDC is Business Development Bank, Bank for Entrepreneurs. It's an arm of the Canadian government, Crown Corp wise. And that's what we're here to do. We support entrepreneurs in Canada. financially, from an advisory perspective, as well as sometimes from like a venture capital and growth perspective as well. We have a department for that.


00:13:29 Matt Glen
Wow. So is your whole career based in Kelowna? Have you been in Oakland? It is, yeah.


00:13:33 Amanda Price
It is, yeah. Yeah, I actually, I moved up here right after graduating from SFU. I did accounting finance down there. And then when I went to seek my CBA designation and start down that path, I did all my recruiting efforts up here. I've been employed here ever since.


00:13:48 Taylor Atkinson
What a cool... To be able to see all these companies acquiring, being bought, sold, financing, what assets they're scaling in, what's working, what's not. You just get to connect with entrepreneurs on a daily and see what businesses are flourishing. Yeah, to me, that's super exciting. Definitely.


00:14:07 Amanda Price
And that was part of the draw really is the diversity of what you'd be looking at. So whether it's the type of client and individual on a personal level or the industry itself. And then you mentioned the different financing types. So, you know, are we buying a building? Are we buying a business? Are you starting a business up? Do you need a new piece of equipment to grow and scale? What does that look like? Is it just working capital where we're coming in and partnering with your primary lender? as a financial institution and topping some of that up and figuring out how we can be supportive there. So we really see it all and see all sides. And often we work with businesses, you know, I run into people around town all the time and they find out I work at BDC. They say, oh my God, BDC did my first loan back in, you know, 1998. And I always recommend them to people and we wouldn't be here without you. And like, that's a really cool feeling to have and a seat to be in when people feel that way about how you've contributed to their, business life.


00:15:05 Taylor Atkinson
Totally. Yeah. So with that, like what niche is BDC in? Like where do you guys excel in terms of helping clients?


00:15:12 Amanda Price
Yeah. I mean, I guess the first thing I would say is that we identify as a complimentary lender. So we only do term loans and the financing arm that I'm in. Growth and transition capital, you get into some equity and messaging financing as well, but let's say primarily. term loans with us. Shortest is a five -year, you can kind of extend from there, maybe 10, 15, and then 25 on property. So we always need any business we work with to have a primary lender. They're going to work with a credit union, they're going to work with one of the primary banks, and they will hold the banking relationship, your bank accounts, your credit cards, ideally a line of credit that they can utilize for their working capital, but that's not always the case. So oftentimes that's where we come into the conversation. That could be where a business is maybe too young to access the capital they need from one of those other institutions just based on their credit risk and guidelines. Or maybe they have been around for, you know, five to 10 years. But if they're with a credit union, often they're capped out at 50 ,000 working capital line of credit. And maybe they need 200 to keep things revolving. Maybe they need more than that. So we don't have line of credits, but we would. Do a term loan for working capital and expect that you can revolve that yourself. Other times, you know, Matt, we've talked about this before, but like loan to value side of things. So if they're looking to purchase a building, the owner occupied building, maybe the one that they're in, maybe they're shopping for something new. Often banks, they like a 75 % number, sometimes it's lower, sometimes it's getting a little bit higher lately. But if we can look at 80 to 100%, that is a good reason to kind of... shift to us or maybe we work together and often we do that and share the security on that building where let's say a bank can do 60 and we're going to do another 25. Now that client gets up to 85, still within everybody's risk guidelines, but they're able to make a better business decision for their business and for their capital needs.


00:17:10 Taylor Atkinson
Yeah, cool. And like geographically, are you based mostly financing, working with entrepreneurs like in the Okanagan or do you scale out externally in the province?


00:17:18 Amanda Price
Really just the Okanagan. Sometimes we'll get referrals here and there for other regions, but we try to hand them off to local branches because there's local expertise to be had there that makes sense to keep that relationship local.


00:17:29 Taylor Atkinson
So yeah, what business is locally do you see like the most growth in the last few years? Like where? Where are the opportunities and like what companies are kind of the most successful right now? We're seeing a lot of growth on the manufacturing side of things,


00:17:39 Amanda Price
seeing a lot of growth on the manufacturing side of things, certainly. There's a lot of sneaky sleeper businesses here in Kelowna that you wouldn't necessarily think of that are really expanding and finding a niche space nationally. And a lot of that scales really fast. Once you're kind of getting in with a national distributor or something like that, then you have production levels to meet. You have different certifications that you need for your manufacturing facility. All of that. So that's where we can come in and we might help on an advisory side to make sure that they have the certifications necessary and kind of take that off their hands from managing themselves. Or, you know, working capital side or equipment. So if they need bigger pieces of equipment, I have a client that I just visited this morning. She's distributing nationally to different grocery store chains, Loblaws, Sobeys, etc. And they're moving into a second manufacturing space. And they just moved into this one like a year and a half ago. So they're kind of blowing out the doors on that. We need to do more equipment, more freezers, more mixers, all of that, right? So we're helping support that growth for sure.


00:18:42 Matt Glen
That's fantastic. So would you help like a tenant looking for to open a new business or they'd be reaching out to you or you want to? focus on people looking for expanding businesses, second locations, or trying to buy real estate along with their business? Who and when should they reach out to you?


00:18:54 Amanda Price
You know, we do it all. So we do have a bit of a reputation as kind of being, you know, one of the only institutions that can help a startup. It's not really the ideal scenario all the time, but given the right background of somebody, the right personal net worth and degree of investment and experience. So maybe they're already... doing something and working as an employee and they want to go off on their own, that can definitely be something that we can help support. Beyond that, you know, we see tenant improvements all the time. I also just talked to a client this morning about that. So they are an existing longstanding business. My borrowers bought it four years ago. They inherited that business. Now they're expanding into a second location. So we're going to help their expansion there and finance the tenant improvements for them. So we look at things like that on a forecasted basis, which I think is also what makes us unique. So something like a startup, another bank isn't going to look at it until you have two years of financial statements, right? Two years of proven revenues, proven cash flows. We are able to look at a reasonable pro forma story. So we're going to look at your income statement forecasts and say, all right, what is this business actually going to do? How are you going to get there? What level of comfort do we need over some kind of a cushion to be able to repay back our debt, essentially? And then what kind of personal net worth and credit history do you have that would also support that narrative, right? It's not that we necessarily need to take any of that. It's just that we are going to use that, you know, similar to how Taylor is going to look at something on the personal mortgage side and say, all right, what's the story of this person here? Are they a reasonable person to do business with and to give money to, right?


00:20:35 Taylor Atkinson
Yeah. I mean, from an underwriting point of view, if there's no assets, no equipment and not a startup, like they've been in business, they just need that growth. How do you kind of underwrite it? Like if someone's looking for, hey, I need a couple hundred thousand dollars because I have a new idea or new location that I want to branch off on this business. We need more employees, et cetera. What do you look for in terms of analyzing that?


00:20:57 Amanda Price
That's a really good question and a great point. So that kind of speaks to the complementary lender relationship. So your primary bank, let's call it RBC or CIBC or whoever you're with. If you have a line of credit there, they're usually going to have a general security agreement as their security with you. That's their GSA. They're laying first claim over your accounts receivable, your inventory, all of that. We often, under a certain threshold, so typically $350 ,000, we're operating on an unsecured basis, depending on what it is. If it's a big piece of equipment, we're securing that specific piece of equipment. And the rest of it, we're going to do a subordinated GSA. for that. So we are fine to subordinate behind your primary lender. Everybody works nicely together. Everybody holds hands and is happy with that arrangement. And I think that's the piece where we're really able to come in and be friendly with others and kind of playing the same pond. So we'll do that. And then we'll also do personal and corporate guarantees. So the personal guarantee side of things is not registering anything against your personal assets. So if you have a home, we're not registering against that specifically or any of your investment accounts. We are essentially having you sign a piece of paper that is, you know, upholdable, but it is a little bit less serious. It's not going to show up on your credit the same way that registering against Title would. So that's essentially a promise to pay from a personal perspective. And then it would also maybe be a corporate guarantee if we're bringing in a corporate shareholder to that arrangement as well.


00:22:24 Taylor Atkinson
And then revenue per like debt associated to it? Are you underwriting it based on, you know, we have like 100 ,000 NOI or retained earnings moving forward? Like what's the debt capacity that they would generally be allowed for that?


00:22:38 Amanda Price
Yeah, there's not really specific thresholds on that. Like you could be a startup warranting a certain level of initial lending. Ideally, we're looking in the 500 ,000 to, you know, 15 million range in branch for the most part on the revenue side. But the loan can really be of any size. So primarily, we're looking at the debt serviceability, the net operating income, your EBITDA, really. And if there's any other debt arrangements and how those kind of term out to support that. So we would look at that as well as projections, because the projections, especially when you're growing and scaling and improving your business or you're buying a big piece of equipment that's really going to potentially double your revenues or increase your margins. 35%, that's meaningful. And we can create a story around that. So it doesn't necessarily have to be on the historical basis. But that's not really a minimum.


00:23:30 Taylor Atkinson
If I was in your position, my wheels would be spinning all the time, like driving around town. I'd be like, I know how much that company makes and like where the profit margins are. Because that's essentially what your job is then, right? Is the customer facing business development.


00:23:34 Amanda Price
I'd be like,


00:23:39 Amanda Price
what your job


00:23:43 Amanda Price
Yeah, it's really fun to get a peek in there. And I guess I have a bit of that mindset as well. And I remember... Probably the first week I started, you know, there's six other account managers here and branch managers and regional managers. And I just kept asking everybody, I'm like, do you guys own businesses? Do you want to share some businesses? How are you not doing that all the time? And the answer was always no. Nobody does, which is crazy to me. But it presents a lot of really interesting opportunities for sure. There would obviously be a conflict of something coming to us, but it does get like the wheels turning, like you said. Oh, wow. doesn't look so hard. You make it look easy.


00:24:22 Taylor Atkinson
Yeah. There's gotta be like a business in the back of your mind and we'll talk off air. Cause I don't want to, you know, just go golden ticket, but like, there's gotta be an asset or a company that you're like, yes, this is like, you just walk in, say the magic words and you get approved. Yeah.


00:24:27 Matt Glen
know, just go golden ticket, but like,


00:24:33 Matt Glen
you just walk in, say the magic words


00:24:37 Amanda Price
You know, that would be really fun, but no, there's definitely some almost like too easy kind of businesses out there. Right. And, you know, where they're getting their revenues from and how secure and reliable those are and how recurring they are is a really big part of that story.


00:24:54 Matt Glen
Yeah. Just talking about how this works practically, like if you have a tenant looking for a space, you find a space, you negotiate an offer to lease and you negotiate a $25 per square foot tenant improvement allowance. How do you come up with a value to lend the company for your build -out? What contractor quotes? Do you take the negotiated allowance into what you approve? How do you look at that?


00:25:15 Amanda Price
Yeah, all of those things. So really, when you first come to us, if we're trying to get to a term sheet stage and figure out how much you could potentially borrow from us, we'd look at something like a budget. Depending on your qualifications, can you put that budget together? Or do you need a general contractor to come in? Do you need the quotes to substantiate a bit more of that?


00:25:36 Matt Glen
Yeah.


00:25:36 Amanda Price
And so let's say we're coming up with $200 ,000 on that. And let's say the landlord is going to provide 50, that's $150 ,000 gap. If you have equity in the business already, we might consider that and do 100 % of the 150. If you don't, we're going to look to share some of that. So let's say you do 50 and we do 100 of that. Now the landlord's done 50, you're doing 50, we're doing 100, you get to your $200 ,000 to spend. And then we would disperse it based on the invoices. So you kind of batch together some invoices as things get built out, we would deposit funds into your account and then you pay the invoices accordingly.


00:25:51 Matt Glen
you don't,


00:26:15 Matt Glen
And then the landlord's like tenant improvement would just get allocated to you when it gets paid out? It wouldn't come to us.


00:26:19 Amanda Price
wouldn't come to us. So it'd come to the tenant. So one of the scenarios I was looking at actually last week is they're going to get about an $80 ,000 credit back from the landlord for their improvements, but it's not going to come until they get occupancy until they're open. So really they need to front load some of that working capital and deploy it accordingly, right? So they need that up front. So we actually shifted our loan structure a little bit because their total project needed tenant improvements and working capital components. And we're basically saying, we're going to do 100 % of the tenant improvement side of things. When you guys get the 80 grand back, just keep it. That'll be the working capital side. You kind of cycle that through later. Because we knew the timing difference. Like you could account for that, but they're not going to be able to pay any invoices with that for the next nine months. So it's not particularly helpful right now. Like I have these conversations all the time when I'm showing a place and it's just like all the hard work in negotiating the tenant improvement,


00:26:57 Taylor Atkinson
kind of cycle that through


00:27:06 Matt Glen
not particularly helpful right now. Like I have these conversations all the time when I'm showing a place and it's just like all the hard work in negotiating the tenant improvement, how it actually works. Like, well, the landlord's going to pay, like you said, 50 grand or whatever it is. Yeah. Don't get paid that until after it's all done and your business is running. And like a lot of times they need it before then. So it's interesting to hear that.


00:27:26 Amanda Price
Yeah. So that's when we were able to kind of figure that one out for them. which seemed, you know, acceptable to everybody.


00:27:33 Taylor Atkinson
Yeah. Yeah, you're kind of like working in the bridge loan space of,


00:27:36 Matt Glen
space of, you know, bridging that gap. So you buy a commercial strata unit that's a shell condition needs to be built out. So you got to buy the unit and the improvement. Like how would you typically structure something like that? It would probably depend on if the business that's going in there is already operating somewhere else. So to what degree can we rely on those business operations to continue once they're in that new space?


00:27:48 Amanda Price
would probably depend on if the business that's going in there is already operating somewhere else. So to what degree can we rely on those business operations to continue once they're in that new space? What does that change to them? Does that expand their debt capacity as well, right? You know, we've talked about this before, but we could look at up to 100 % of loan -to -value for an owner -occupied space where it makes sense. So that's going to be the debt servicing. That's going to be the equity in the business, staying in the business, whether that's the retained earnings, not getting paid out 100 % as dividends, you know, keeping some of that hauling in and accumulating.


00:28:20 Matt Glen
of that


00:28:22 Amanda Price
Or it could be shareholder loans. And so if we're mutually investing in a project, you could be contributing more on the shareholder loan side of things. And then we're going to ask that some of that stays there on the balance sheet for a couple of years before it gets repaid back to you. So that really it is a shared risk project and not just kind of you're being perceived to contribute and then pull it all out again. So we would look at the building purchase on its own and then we would look at the leasehold improvements. say what budget makes sense here and kind of do the math for both loans in terms of what the business can afford.


00:28:41 Matt Glen
not just


00:28:56 Amanda Price
What makes sense. Yeah.


00:28:58 Matt Glen
Yeah. Interesting.


00:28:59 Amanda Price
We do that all the time though, for sure. Cause when you're right, there are so many industrial stranded units around when you're occupying them. Every business that goes in needs something different and they're going to build it out in a different way for themselves. So.


00:29:11 Matt Glen
Yeah. Like I actually have like a. Decent amount of those listings myself right now, the newest ones in Kettle Valley, 5 ,300 Kettle Valley, three strata units, shell units, they're for lease and for sale. And like they're shells. So like they're going to need a significant tenant improvement. Just like for me to talk to a client, I'm going to tell them what's up, but I'm probably just going to tell them to come listen to the show because it's explaining it super well.


00:29:32 Amanda Price
it super well. Well, I'll ask you, like, what has been the plan so far when tenants are coming to you and they're saying, here's what I want in this space. How can I get there? What is the plan that they're going in with? Are they thinking, all right, I have 250 grand in my back pocket and I'm going to pay for these and maybe get funding later. Or we're just going to knock down all the doors and see who can give me this money so I can get going.


00:29:54 Matt Glen
So I think there's a huge gulf between like. people that are not sophisticated and people that are. And I feel like there's a lot of new businesses that I deal with that literally have no idea how these things work, right? Like everything from the offer to lease, to the lending, to the build out. Like some people I've talked to just expect the landlord to build it out how they want. Some people expect the landlord to just not even exist and they're just going to do whatever they want. And things like going through the offer to lease. tenant improvement, free rent, fixturing period. Like sometimes I can tell that this person I'm talking to has never even heard any of these terms before. And a lot of times they know exactly what they want and how they're going to do it. And if the deal doesn't work, it doesn't work. So like for me, it's a major wide range, right? So I guess the value comes in where I can take some money depending on where they are and be like, here, let's talk to Amanda. She's going to tell you how to walk through this or here's what you're going to need in general terms. And actually it's kind of wild how many businesses are out here when it feels like everyone's driving this ship like without a captain. pretty much, right? A little bit,


00:30:03 Taylor Atkinson
feel like


00:30:52 Amanda Price
A little bit, right? Yeah, you kind of just say, I'm going to start this business. I'm going to buy this business and just plow right ahead. And, you know, a lot of business owners that we see have been building the business for so long or working in it, but not necessarily on, right? So that's a bit of the other side of things that we see on the change of ownerships is, you know, how much value is actually in this business without you as the owner?


00:31:07 Matt Glen
a bit of the


00:31:16 Amanda Price
Right. What kind of processes have we put in place? Standard procedures? What's the operational efficiency like? Are the roles underneath you defined or have you been able to delegate? Because the stats that we see are, you know, 70%, 70 % of Canadian business owners are planning to offload their business in the next 10 years. So like incredible opportunity out there.


00:31:37 Matt Glen
incredible opportunity out there. If you want to start saving your pennies,


00:31:40 Amanda Price
your pennies, buy yourself a job.


00:31:42 Matt Glen
yourself a job.


00:31:45 Amanda Price
You know, they probably have a value in mind they want to get. But it's 2026. AI is coming. You know, AI is here, frankly.


00:31:52 Matt Glen
AI is here, frankly. And so what have you put in your business and add into your business that would justify that value that you want somebody to pay?


00:31:54 Amanda Price
so what have you put in your business and add into your business that would justify that value that you want somebody to pay? Someone on the street is going to be looking at your business saying, I can probably start that from scratch for like half that. Maybe I can figure that out. So if you want to be selling your business for a certain price, you have to start looking at that pretty early in the next. We like to talk to clients two to three years before they plan to sell and start poking holes in that or challenging some of those assumptions. And that's also where our advisory side comes in. Because often we're on the financing side of the purchase transaction too. Like that can happen all the time. It's not going to be the same account manager. We'd have a couple different ones in there. But if we're going to be financing that, we want to know what is in this business if you're doing an asset sale or share sale that has value,


00:32:08 Taylor Atkinson
can figure


00:32:23 Matt Glen
that's also where


00:32:29 Matt Glen
happen all


00:32:36 Amanda Price
is in this business if you're doing an asset sale or share sale that has value, right? And what's going to carry forward without that key person. So we look at lots of different advisory mandates for succession planning and getting SOPs in place and all of that.


00:32:52 Taylor Atkinson
And is that like a consultation fee that you guys charge? Or like, where do you earn your revenue from that side? I like that you phrase it like that,


00:32:59 Amanda Price
like that you phrase it like that, actually, because it is technically a loss leader for us. So I will throw that out there. We do charge fees, not as much as we should if we were, you know, an external consultant. Whole core of our being is BDC is here for the Canadian entrepreneurs and to support them. These are kind of value added things that we're trying to provide for our clients. So you actually don't even need to be a financing client to use our consulting side. And it's not me as a consultant. We're all kind of just partners in this. There's specific advisory partners that would be delivering these mandates. They're different for different things. On the financial planning side of things, that would be a well -qualified financing individual with probably a CPA background in there. Operational efficiency, we see a lot of manufacturing people in that space and say, you know, how can we lay out this building better? Let's look at some of these margins. Where can we reduce waste in our production? So same on materials because as inflation increases and cost rises and gas prices have really contributed to transportation costs of getting... Almost all raw goods into your business. You can't necessarily hand that off to clients right now. You can't increase your prices because there's really no appetite for that. There's no ability. People don't have extra cash in their pocket, but they still need to buy your good and they want to feel good about it. So where can you save margins on the back end of things by improving other, you know, efficiency elements of your business? So we look at doing that with clients all the time and we actually have. A specific lift program that your viewers or listeners can go explore online as well right now. So that's a combination of advisory and financing at preferred rates that aims to help Canadian businesses move into 2026 and be competitive in a global marketplace. So that will help you with some of the efficiency. It might help you with some AI or just sophisticated technology adoption. So we've had clients, you know, in the lumber space. apply AI within their work schedule and save about 10 % in some of their wasted materials by just structuring the jobs for the next day differently. And that really saves their butt on the margin side of things when they're not able to pass that on to the consumers. So they can still kind of maintain the same bottom line, but, you know, really evolve things forward.


00:34:04 Taylor Atkinson
raw goods


00:34:17 Matt Glen
to feel


00:35:21 Taylor Atkinson
Cool. That is super interesting. This might be harder to quantify, I guess, but... geographically like Kelowna compared to other places in the province or nationally do you know like statistically or roughly where you know your branch BDC sits in comparison I'm just trying to gauge like do we have a ton of small business owners is the capital being deployed and you know recycled efficiently here like do we have a lot of stability and growth on the private sector side of things here compared to other places in Canada or BC? That's really interesting.


00:35:55 Amanda Price
really interesting. I think I can always speak to that anecdotally, and it feels like we do. I think for the volume of account managers and the size of our portfolio relative to somewhere like the island or up north, in Vancouver, in the Lower Mainland, we're divided into Vancouver and Fraser Valley. And so there's a few different arms of that. And North Van is a separate one as well. There's a few branches. Our own kind of budgeted quotas get broken out accordingly, but it's almost like per person rather than by region. So the number of people you have on staff is going to justify some of that. It feels like, though, here that we are always busy. We're always getting referrals from other regions when they've come across something that really belongs in the Okanagan or, you know, somebody from Vancouver who's buying a Kelowna -based business. That will get referred our way. Or if it's coming from Edmonton, same thing. So really, it seems like we're kind of having our hands in all of it almost all the time. It seemed a little bit slower, maybe four years ago in the post kind of COVID haze of things. There was a bit of an evolution there as well, where it felt like the charter banks were shifting some of their risk preferences and being able to open up and do a little bit more where we would typically be the go -to's. That's maybe shifting again as, you know. The global circumstance of everything, economic situation has pulled back a little. Bond yields are going up. There seems to be less of an appetite. So that's something that we also point to is, you know, some banks will say, all right, we're really not into hospitality right now. We're going to call this loan best of luck to you. And that never happens at BDC. Like we don't have industry appetites. We might have special programs sometimes. So like right now we have special programs that focus on tariff relief and trade resilience. If you're somewhere like BC, Ontario, Quebec, where tariffs are really hitting manufacturing, forestry, steel, automotive. We're the province's biggest hit. And so we have special programs that focus on that. But on an industry basis, if you already have cash out there, you've already gotten a loan from us. You're pretty safe as long as you're still paying it. which is kind of a nice thing to be able to say. So a lot of money out of the marketplace.


00:38:11 Taylor Atkinson
Yeah, that comes from the backbone of helping entrepreneurs in Canada and their small businesses, right? Yeah. Have you seen any kind of negativity, hesitation, pullback from small businesses specifically? Like I know you said kind of the COVID haze, but was there any downturn on because, you know, tourism was a little bit down or ag was down or yeah, bond yields going up? Like what's kind of pushing the needle? the opposite direction of growth for us? We would see that leg sometimes. I don't feel like we've seen it yet.


00:38:38 Amanda Price
would see that leg sometimes. I don't feel like we've seen it yet. We feel like kind of the word around the office or from our economists has been, we're going to start seeing people pull back on some of their investment because everybody feels strapped. But that's been the language for the last couple of years. And we really haven't seen it yet. The people that can still make moves are making moves. Absolutely. And Matt, as you know, like there's some really good real estate opportunities to be had. You're buying the price. You're not buying the interest rate. So it's not always a long -term game. It's sometimes good to get in now and build for the future that way, rather than like being caught on your heels later, which is often the case. So like I said before, we love to talk to people before things are a problem or before you're selling. And usually you need to start these conversations six months before you actually need the money, which is not to speak to how quick we are or not. It's more, once you're in a pickle, it's hard to get you out of the pickle.


00:39:38 Matt Glen
Like banks are kind of tapped out at that point, or maybe you've changed your credit a little bit,


00:39:39 Amanda Price
are kind of tapped out at that point, or maybe you've changed your credit a little bit, or maybe there is no more working capital and the picture just looks so much more dire, right?


00:39:43 Matt Glen
there is no


00:39:47 Matt Glen
And so sometimes when there's offers already on the table,


00:39:48 Amanda Price
so sometimes when there's offers already on the table, it's good to just get that capital in hand and say, I might need this, or I might need to pay some breathing room for tariffs. I might want to explore. some equipment purchases in the next couple of years. Let me get that lined up, even if I don't necessarily use it, right? Like you could sit with funds undisbursed for a year and just know that you have that in your back pocket if you need it.


00:39:56 Matt Glen
might need to pay some


00:40:13 Taylor Atkinson
Right. So you guys facilitate that as well. Like the funds are available, but they're not dispersed.


00:40:18 Amanda Price
Yeah, it's different for everything. Working capital would maybe be six months. If it's equipment, we do have an equipment line. product that we call it, which really means, let's say you're, I'll use $200 ,000 again. If you think you're going to need some larger pieces of equipment and you need to take the time to shop around, like you don't have a quote right now, you don't have an invoice, you don't know what the VIN number is. There's nothing for us to physically register yet. Or maybe it's coming from across the world. Maybe it needs to get here because we can't take security on something that isn't landed. And we don't know what the all -in costs are. So you could say, I think this is going to take $200 ,000 to acquire. And then we would give you an equipment line, we call it for $200 ,000, and you have a year to shop around and spend it. Once you buy the piece of equipment, you give us the invoice, we fund that, then we would register our security after one year. So it can be really helpful to just have in the back pocket knowing you're going to shop around.


00:41:16 Taylor Atkinson
going to shop around. Yeah, that's super powerful. And if you don't use the whole thing,


00:41:18 Amanda Price
if you don't use the whole thing, the whole thing does not roll into a loan. If you only use 100. That's the part that rolls into the loan.


00:41:23 Taylor Atkinson
Yeah, that's awesome.


00:41:25 Amanda Price
Yeah.


00:41:25 Taylor Atkinson
Do you feel then like Kelowna is a little insulated? I know we talk about it on kind of the residential side of real estate is like we're in this little insulated bubble where our economy just keeps kind of ticking and we're not as volatile as Vancouver or Toronto. Is it similar on small businesses here? Ooh,


00:41:42 Amanda Price
volatility is an interesting thing. I think maybe if you're speaking from a real estate perspective, we're a little bit more insulated from that. Some of that has to do with the supply side of things right now as well, right? And then usually people that are looking to purchase real estate have, you know, done it before or have some net worth backing that and kind of understand what that process looks like and know why they want to move forward with that. If we're talking about small businesses that don't own, maybe they're leasing, maybe they're in hospitality or tourism, that has been really challenged the last couple of years. 2023 started with the fires, right? Somewhere in there, there were the floods that cut everybody off from the lower mainland for a little while. Then you had to get more fires. So a lot of businesses in the Okanagan really rely on those warmer months to uphold their business and support, you know, bury the working capital for the winter months, basically. And if that doesn't happen, they're really struggling. So often, you know, something that we can do and we do do proactively in circumstances where it's environmental. Like the fires or floods, we will proactively postpone principal payments for a time for clients that fall within a certain region or a certain like industry code that it makes sense for and provide a bit of relief for them that way. But we hope it's not like relied on, but usually it's always very appreciated.


00:43:06 Taylor Atkinson
Yeah, no kidding. I mean, you just seem to have like such a robust product lineup and have like that authentic, you know, want to help local entrepreneurs. So yeah,


00:43:15 Matt Glen
entrepreneurs. So yeah,


00:43:16 Taylor Atkinson
how can people find out more about you? How do they connect with you specifically or BDC? Like where's the reach out? I feel like there's a lot of good resources on BDC's website.


00:43:22 Amanda Price
feel like there's a lot of good resources on BDC's website. Specifically, if you are looking for any of our special programs right now, we have forestry and lumber programs. We've got steel programs. some manufacturing programs. We've got the LIFT one that I mentioned, which is an acronym for I don't know what at this point, but it has to do with the efficiency in the AI and technology adoption. And that's the one that is preferentially treated at this point. It's a $500 million bundle that the government has granted us with to say, go help these businesses. Let's make sure that we are competitive on a world stage and that we are moving forward because that is something that Canada is kind of known for and the statistics provide is we're not really keeping up in that way. Like our productivity and efficiency is some of the lowest in the G7, which is not how I love to measure things, but it is frankly how business gets done and how you build net worth in certain areas, right? So you can go there. You can find me, Amanda Price, on LinkedIn or via email, amanda .price at bbc .ca. Happy to have a chat and connect over coffee or a phone call. and see if there's any way that we can help out or help move your business forward.


00:44:33 Matt Glen
Yeah, awesome. It's great to talk to you, man. I feel like I need to sit here and pepper you with questions all day.


00:44:37 Amanda Price
Yeah, we'll come back.


00:44:39 Matt Glen
Yeah, tremendous resource for people starting a business, especially like what I do is feel like your phone's going to be ringing off the hook.


00:44:44 Amanda Price
like your phone's


00:44:44 Matt Glen
like your phone's going to be ringing off the hook.


00:44:46 Amanda Price
That's right. We're going to be tight.


00:44:48 Matt Glen
Mostly me asking how to go to the next steps are. Yeah, I'm great, Amanda. Thank you so much for your patience with scheduling this thing. And yeah, I'm really happy. Awesome.


00:44:59 Amanda Price
Great. Yeah,


00:45:01 Matt Glen
we'll talk to you soon.