How do I finance a business acquisition in Canada?
Most Canadian SMB acquisitions are funded with a stack: senior bank debt or alternative term debt (50–70%), seller financing (10–25%), buyer equity (10–25%), and sometimes mezzanine. Voxen structures stacks up to ~$50M.
Start an applicationSenior debt is sized by debt service coverage ratio (DSCR ≥ 1.25×) against the target's EBITDA.
Seller financing — a vendor takeback (VTB) — is the most underused lever. It improves the buyer's leverage and signals seller confidence to senior lenders.
Mezzanine fills the gap between senior debt and equity. It is more expensive but enables larger deals with less buyer cash down.
Voxen's Performance service co-structures the full stack and negotiates with each layer simultaneously to optimize cost and certainty of close.
What secures each product
Figures are typical ranges for a complete file, not guarantees. Final terms depend on revenue, time in business, credit profile and lender review.
| Merchant Cash Advance (MCA) | Unsecured |
|---|---|
| Business Line of Credit | Often unsecured |
| Invoice Factoring | A/R is the collateral |
| Equipment Financing | The equipment |
| Bridge Loan | Usually asset-backed |
| Term Loan | Sometimes |
| Inventory Financing | First charge on inventory + PG |
| Purchase Order Financing | The order + end-customer credit |
| Acquisition Financing | Target assets + PG |