Following Small Business BC’s shocking decision last week to cease operations and file for bankruptcy, Premier David Eby commented on the provincial government’s approach to addressing the struggling organization to date.
Although Small Business BC is a non-profit organization, it receives major program funding from both the provincial and federal governments, and its mandate and programs closely align with the objectives of the provincial government. The organization provides assistance, knowledge, and resources for a very significant proportion of small businesses in BC.
“Obviously for the employees of Small Business BC this is a big deal but for businesses that were dependent on the services the Small Business offered this is significant,” said Eby during a press conference on Monday.
“We were aware that Small Business BC was in financial difficulty and staff were actually working with Small Business BC to try to address that issue. They decided to enter into creditor protection.”
As an inverse to providing a financial bailout to the organization, Eby said the provincial government is now looking to ensure that any provincial funding previously allocated to their work is “protected” and “recovered.”
As well, the provincial government will focus on ensuring any of Small Business BC’s subcontractors are able to continue their services, such as the core Navigator Program — a program where community-based advisors provide free support and ongoing guidance to help businesses grow outside of BC.
Small Business BC’s entire comprehensive website outlining its services and resources has been taken down since the bankruptcy filing. Currently, the website’s homepage is merely a blank white page with one line of text that reads, “Canada British Columbia Business Services Society (dba Small Business BC) was placed under bankruptcy as of December 5, 2024. MNP Ltd. has been appointed Trustee of SBBC.”
“Our priority now is making sure that any taxpayer dollars that were in there are protected, that we’re making sure that that money is recovered by the province. And we’re going to make sure that they follow and adhere to all obligations that they have as employers so that employees are looked after with the assets that they have,” said the premier.
“But this is a third-party nonprofit service provider. It’s not a government agency. We provide financial support to it, but we’ll make sure the taxpayer dollars are protected and get answers for those employees.”
Approximately 36 staff with Small Business BC were laid off last week, on the same day the organization filed for bankruptcy.
The LinkedIn profiles for two senior executives of the organization show they very recently left the organization, including Josh Ludgate, the COO from April 2019 to November 2024, and Tom Conway, the CEO from April 2029 to December 2024.
Archived financial statements reveal that Small Business BC operated with an annual budget of approximately $3.34 million in 2019. This budget grew significantly in the following years, driven partly by program expansions to support small businesses during the pandemic. By 2023, the annual operating budget had reached $7.07 million, slightly lower than $7.38 million in 2022.
In early November 2024, a month prior to the bankruptcy filing, the federal government’s Pacific Economic Development Canada (PacifiCan) announced it would provide up to $2.7 million to Small Business BC to support its programs, specifically for business advisory services, workshops, networking opportunities, and mentorship.
However, on Monday, PacifiCan told Daily Hive Urbanized it has only disbursed a small proportion of this funding to date — $87,832 for eligible costs. Any further payments will be suspended.
“PacifiCan is committed to ensuring the sound stewardship of public funds allocated to support small businesses across British Columbia. SBBC’s bankruptcy put the organization in default of its funding agreements with PacifiCan and, as a result, PacifiCan has suspended further payments under these agreements,” said Harjit Sajjan, the federal minister responsible for PacifiCan, in a statement to Daily Hive Urbanized.
Small Business BC’s services assist tens of thousands of businesses annually.
The organization’s shutdown could create a major void in such services during a highly turbulent time for businesses due to weak economic fundamentals in BC and Canada as a whole, including the growing risk of bankruptcy.
“This news will have a profound impact on BC entrepreneurs. Small businesses are the heart of our communities and the economic engine of our province. Behind every small business are creative, hardworking and resilient entrepreneurs that are creating jobs and building communities,” Sajjan continued.
“PacifiCan will work with our partners to understand the impact of this announcement as we continue to support the needs of small businesses. I recognize that this news greatly impacts SBBC staff, who work hard to support BC small businesses, and is especially difficult considering the holiday season. My thoughts are with all those affected.”
Small Business BC’s origins can be traced back to Vancouver’s hosting of Expo ’86, when the provincial government established a provincial agency to help businesses capitalize on the economic opportunities created by the World’s Fair. In 2002, the organization transitioned into a non-profit entity, maintaining strong connections with the provincial government.