Back to Markets
Stocks● Neutral
Why Canada's Succession Crisis Is a $2 Trillion Opportunity
Underrepresented buyers lack the education and capital to acquire profitable SMBs from retiring owners, risking a $300B wealth transfer, a new study finds.
Continue with
A new report argues that buying a profitable small business deserves the same attention as launching an AI startup. The gap between retiring owners and would-be acquirers from underrepresented groups sits at roughly $2 trillion, according to the study by national non-profit Pitch Better and CQ Business Consulting, funded in part by the Canadian government.
The research, called Inclusive Succession, found that entrepreneurs from racial and other traditionally underrepresented backgrounds face steep education and capital barriers when trying to take over an existing company. Lead researcher Chantelle Quow-Craig, managing director of CQ Business Consulting, said in an interview that talented people are starting businesses from scratch with fewer resources and no intergenerational business wealth. At the same time, thousands of viable, profitable businesses close when their owners retire.
She asked why those two groups are not finding each other. The report's answer: a lack of structured, accessible education on acquisition and exit transactions.
The revenue at stake
Canada's aging business owner population has created a staggering market opportunity. A January study by the Business Development Bank of Canada estimated that one in five small and medium-sized business owners plan to retire within five years, leaving $300 billion in annual revenue open for acquisition.