Toronto's only food startup incubator to shut down due to lack of funding

Toronto's only food startup incubator says it is shutting down due to a lack of funding, leaving dozens of food companies without production space.

Food Starter said in an email to its clients that the last day for processing at its facility would be Dec. 21 and that its 160 tenants would have to move out of its 20,000-square-foot plant as early as Dec. 31.

Linda Cheung of Dessert Studio says her company has been at Food Starter since nearly the beginning but now she's trying to figure out what to do next.

"We're busy getting ready for the Christmas season because we are a dessert company. Right now, we're just focused on getting through the month of December," she told CBC Toronto.

"We have ovens, we have tables, we have to find a place to put them, and when people are on vacation, it's very difficult to find a place to go."

Food Starter executive director Petra Kassun-Mutch says funding from the province dried up in the fall of 2017, but things were looking promising for the incubator as recently as six months ago with talks to partner with universities or colleges.

Those efforts proved fruitless in the end, she said, and despite increased funding from the city and efforts from supporters, Food Starter was unable to secure additional funding from other levels of government or corporate sponsors and was left with no other choice but to shut down.

"The idea of supporting food entrepreneurship is really important," she said. "The cost of doing it is going to require public funding and and some private support."

Food Starter is now in conversations with the city to remain in its facility until end of January.  

In a statement to CBC Toronto, the city said that it is aware of situation Food Starter companies are facing and that it has engaged the incubator's board to look at options to support its clients.

"The City will continue to assist Food Starter in its transition, including further funding contingent on an appropriate business plan," said city spokesman Shane Gerard.

"It is anticipated that this transition plan would be focused on assisting clients with their future plans and providing support to them."

Looking for alternatives

With Food Starter's future in doubt, some of its clients have already begun looking for alternatives, but for some it has proven to be a struggle.

Kassun-Mutch says the nearest facility similar to Food Starter is in Cobourg, which is about an hour and 30 minutes drive away, leaving some to look for other options.

William Bowcott, another client with Food Starter, says while the situation his business is in is difficult, he has his fingers crossed that he'll find a place that will work.

"When you decide to start a business, you almost need to accept that there's going to be no one to bail you out," Bowcott said.

"We started scouting out some locations, but it still might be a hard time to get something together in time to make sure that our customers have meals in the New Year."