Business Grants Basics

Small Business Grants

Grants are an excellent alternative for small business entrepreneurs since they provide free money. There are numerous small business grants available. Some are open to all business owners, while others are restricted to women, minorities, or low-income entrepreneurs. Small business subsidies have numerous advantages. You don’t have to pay them back, and they frequently come with continuous support in the shape of training or advice, and grant recipients receive a lot of notoriety for their firm. However, there are several disadvantages to business grants.

“Free” Doesn’t Mean Without Cost

Grants are deemed free money since they do not require repayment. However, this does not mean that grants are free. Grants for small businesses are quite competitive. You could squander a lot of time and money applying for funding that you will never receive. There is no guarantee of a return on your investment of time and application expenses. Some awards have a lengthy and demanding application process that includes a detailed pitch, videos, and costly travel. The time and effort you put into applying for grants is not always worth the slim probability of success.

There are Limited Options for Certain Circumstances

There aren’t as many business grants as you may assume, but if you know where to look, you can find some good ones. The Small Business Administration, local Small Business Development Centers, and Grants.gov are all excellent resources.

Many Grants are Only for Specific Types of Businesses and Owners

Even with grant options, the range of choices accessible to you depends on your situation. Some awards, for example, are solely available to businesses engaged in research and development. Other grants are intended to help minority or female-owned small companies. These requirements limit prospects for people who do not fall into one of these categories while increasing competition for those who do.

Small Business Innovation Research Program

This award is intended to support profitable scientific research and development. The company must be based in the United States. The company must be owned and controlled by US citizens or permanent resident aliens at least 50% of the time. There can also be no more than 500 employees in the company.

Amber Grant

The Amber Grant provides a $10,000 reward to a woman-owned business each month. At the end of the year, one of the recipients will get an additional $25,000 grant. Applicants must share their story and pay a $15 application fee to be considered.

Cartier Women’s Initiative Award

This prize is also open to female entrepreneurs. There is a regional category prize and a science and technology award for the Cartier Women's Initiative Award. The regional prize is $100,000 for first place and $30,000 for second and third place.

First Nations Development Institutes

This organization aims to provide grants to Native Americans, Alaskans, and Hawaiians. They not only provide funding but also assist with the application process, which includes crafting grant bids. First Nations also assists individuals in locating appropriate funds offered by other organizations, including the US government.

National Black MBA Association Scale-Up Pitch Challenge

According to the NBMBAA, its mission is to assist new enterprises with African American ownership. This is a startup pitch competition with cash awards ranging from $1,000 to $50,000.

The Minority Business Development Agency

The United States Department of Commerce manages the Minority Business Development Agency (MBDA). This group is dedicated to assisting minority-owned businesses in obtaining the resources they require to grow and prosper. Grant competition requirements vary regularly, so be sure to check the MBDA's website for the most up-to-date information. Currently, the MBDA assists its members in applying for funding through Grants.gov. This is especially useful because many business owners struggle with the grant application procedure.

You Can Find Grants in Surprising Places

The government and organizations dedicated to assisting minority, woman, and veteran-owned firms are the first places most business owners look for funding. Grants can sometimes be found in unexpected locations. Some larger corporations, for example, provide small company grants.

FedEx Small Business Grant Contest

This contest is available to any company that has been in business for at least six months and has 99 or fewer employees. Every year, they provide eight $7,500 fellowships, one $15,000 grant, and one $25,000 grant.

National Association for the Self-Employed

This is a $4,000 award available to NASE members. This award can be used to fund marketing, advertising, personnel hiring, facility expansion, and other specialized business needs.

A Grant is Not Enough to Fund a Business Long Term

Small business grants are insufficient to properly fund a business. Grants are often one-time awards, and the odds of getting one are slim due to severe competition. Credit Line Hybrid is an outstanding backup finance strategy for your business.

Credit Line Hybrid

This is a type of unsecured business loan. The interest rate on a Credit Line Hybrid is lower than that of a secured loan. You can obtain some of the largest loan amounts and credit lines available for enterprises. With indicated income, you can even receive 0% business credit cards. Credit Line Hybrid submits reports to commercial CRAs. You can create business credit, which will allow your company to access further finance with no personal guarantee.
To be approved for this program, you must have a credit score of at least 680 or a guarantor with acceptable credit. There are no financial requirements for acceptance. You can frequently obtain a loan for five times the existing greatest revolving credit limit account, which is up to $150,000.

Don’t Give Up on Applying for Grants

You should not rely on small business grants as a sure source of money, but you should apply if the time and application fees are balanced by the potential reward. In either case, it is quite improbable that you will receive enough funds to adequately fund your business in the long run.

Grants are Supplement Not Support

Grants are most successful when used as supplemental funding. First, secure dependable business funding, such as Credit Line Hybrid. Then, if you are fortunate enough to be awarded a grant, utilize it to supplement your existing funds and lower your overall business debt.

Tips When Applying to Small Business Grants

1. Apply for the Right Grants

Take note of the grants you apply for. If you are not eligible for a grant, do not apply. Grants that are tailored to a specific need lessen competition. Apply only if the prospective prize is worth the effort and money spent on the application procedure.

2. Study Requirements Carefully

Make sure you are capable of completing the grant application requirements. For example, if you need to go to present your pitch to the grant committee in person, make sure you can cover the costs.

3. Turn in All Required Documents

If you do not provide all of the needed documentation, your application will be refused. Grant committees may not even contact you if your information is inaccurate. You may never realize that all of your efforts were in vain. You avoid this, make sure to double-check all of your documents before submitting your application packet.