ISED Innovation Grants for Canadian Small Businesses 2026

Published March 2, 2026 · Updated for 2026 program landscape

Innovation, Science and Economic Development Canada (ISED) is the federal department responsible for Canada's innovation economy, and it oversees several of the most significant funding programs available to Canadian small and medium businesses. From the massive Strategic Innovation Fund to the accessible Canada Digital Adoption Program, understanding the ISED ecosystem can unlock substantial non-repayable funding for businesses investing in technology, innovation, and growth. This guide maps the major ISED-adjacent programs relevant to SMBs in 2026.

Canada Digital Adoption Program (CDAP)

The Canada Digital Adoption Program (CDAP) was one of the most widely used ISED programs for small businesses before its closure. The Boost Your Business Technology stream provided up to $15,000 in grants for digital adoption planning and implementation, plus access to a 0% interest BDC loan of up to $100,000. As of 2025, CDAP intake has closed for new applicants. However:

• Businesses that applied under open intakes and are still completing their digital adoption plans may still be eligible for the final BDC loan component
• A successor digital adoption program has been discussed in the federal budget; watch the ISED website (ised-isde.canada.ca) for announcements
• Provincial equivalents exist in some jurisdictions — Ontario's Digital Main Street program continues to offer subsidized digital advisory services

Strategic Innovation Fund (SIF)

The Strategic Innovation Fund is ISED's flagship large-scale investment program, designed for substantial innovation projects in the industrial, clean technology, and agri-food sectors. Key facts:

• Minimum project size: $10 million in total project costs — this program is not for early-stage SMBs
• Government contribution: Typically 25–50% of eligible project costs as a repayable or conditionally repayable contribution
• Sectors prioritized: Advanced manufacturing, clean technology, bio-innovation, digital industries, aerospace
• Application: By invitation following an Expression of Interest; intake is rolling but selective

For most Ontario SMBs, SIF is relevant only if you are scaling significantly and need anchor federal investment to attract private capital. At that stage, SIF can be transformative.

Industrial Research Assistance Program (IRAP)

Delivered through the National Research Council (NRC) — an ISED portfolio agency — IRAP remains the most accessible federal innovation grant for technology-focused SMBs:

• Funding range: $50,000 to $500,000+ for technology development projects
• No open call — relationship-based: Contact your regional Industrial Technology Advisor (ITA), who assesses your project and sponsors your application
• Eligible costs: Wages of R&D personnel (up to 80%), contractor costs, materials consumed in the project
• Speed: Initial ITA visit can happen within 2–4 weeks; funding decisions typically follow within 4–6 weeks of a supported application

Ontario businesses: NRC-IRAP has offices in Toronto (Mississauga), Hamilton, Kitchener-Waterloo, Ottawa, London, and other centres. The ITA assigned to your region becomes your ongoing point of contact for multiple funding cycles.

Futurpreneur Canada (ISED-Supported)

Futurpreneur Canada receives federal funding through ISED and delivers business financing for entrepreneurs aged 18–39:

• Startup loan: Up to $20,000 from Futurpreneur + up to $40,000 from BDC = up to $60,000 total at attractive rates
• Mentorship included: Every Futurpreneur loan recipient is matched with a mentor for up to 2 years — a significant value-add beyond the capital
• Business plan required: Applications must include a complete business plan, financial projections, and evidence of market validation
• Not sector-specific: Futurpreneur serves businesses across industries, including retail, food service, trades, technology, and creative sectors

CanExport SMEs

For Canadian small businesses pursuing international markets, CanExport SMEs (delivered by the Trade Commissioner Service under Global Affairs Canada, with ISED involvement) provides:

• Up to $99,999 per year in non-repayable contributions covering 50% of eligible export development activities
• Eligible activities: market research, trade show participation, legal fees for foreign market entry, digital marketing in foreign markets, travel for business development
• Must have $200,000 to $100 million in Canadian revenue and no more than 500 employees
• Open on a rolling basis — apply at least 30 days before your first activity

ISED's Innovative Solutions Canada (ISC)

Innovative Solutions Canada is a federal procurement program that pays Canadian SMBs to develop innovative products or services that federal departments need. For eligible businesses:

• Phase 1 (feasibility): Up to $150,000 to prove a concept works
• Phase 2 (prototype): Up to $1 million to build and test a prototype
• Federal departments post challenges; businesses apply with proposed solutions. If selected, you receive the development funding and a potential path to a federal procurement contract
• ISC challenges are posted at ic.gc.ca/isc — browse by department and sector

How to Navigate the ISED Ecosystem

The ISED portfolio is large and often confusing. Here's the practical approach for Ontario SMBs:

1. Start with IRAP if you have a genuine technology development project with unclear outcomes — find your ITA at nrc-cnrc.gc.ca/irap
2. Use CanExport if you are actively pursuing US, European, or Asian markets — the 50% cost-share on trade show trips and market research is extremely valuable
3. Watch for ISC challenges if your product or service addresses a government problem — this is a low-competition path to significant non-dilutive funding
4. Futurpreneur if you're under 40 and in your first 2 years of business — the mentorship component alone is worth the application process

Related reading: How to Apply for IRAP Funding | Canada Digital Adoption Program Guide | Grant Blog