What is a Business Grant?

What is a business grant?

A business grant is a sum of money given to a business in order to help them further their business. They’re usually distributed by governments, corporations, foundations, or trusts. Unlike many other types of business funding, grants don’t have to be paid back and business owners aren’t required to give up equity in exchange for a grant.

However, most small businesses probably won’t qualify for a small business grant, as they’re tied directly to US government agencies that have specific goals. There are some categories of business that are an except, though, including research and development companies, as well as some high tech companies.

State level grants are also tied to the direct economic or social needs and many of them are matching grants. That means that you’re expected to match the amount you’re loaned with your funds.

Finally, there are local small business grants that are usually less competitive than federal or state grants, but are often for less money. If your startup is clearly helping your local community, this could be a good avenue for getting some funding.

Types of business grants

Before we talk about how to get a business grant, let’s take a look at the main types of business grants out there.

Government business grants

Government grants for small businesses come in three forms: federal, state, and local. Federal grants usually offer the most money — and have the most competition. They’re also pretty specific and usually tied to a government agency that has clear requirements for qualifying for the money — and for what they expect you to do with it.

State grants, on the other hand, are usually less money than federal grants but also — depending on your state — less competitive. State governments may work with the federal government to administer money that’s been set aside specifically for small business grants.

And on the local level, grants tend to be even smaller but they may be easier to get, because personal connections still mean something! Usually these grants are about improving your local community, so if your startup or small business is focused on bettering your town or county, definitely take a look at local grants.

In addition to agency-specific government grants for small businesses, there are grants available that are much, much more specific. Your best bet for finding a grant that matches your startup closely is to search the Grants.gov database to find out what’s currently available and what most closely matches your startup. You should also check back periodically, as government grants for small businesses end and are added frequently.

Another thing to know about when you’re looking at government grants is that a lot of grant management is handled through the Small Business Association or SBA. The SBA doesn’t actually manage the money — that’s done through partner organizations, like community grants — but rather they act as a go-between for the government and partner lending organizations.

Click here for more information on government grants for small business.

Grants for veterans

Grants for veterans are a little harder to list out than government grants (even though almost all grants for vets are government-funded) because grants are usually open for a set period of time, after which that money is no longer accessible. So it’s not actually possible to list out business grants for veterans, because by the time you read this, they may or may not still be available. But that doesn’t mean there aren’t some great financing options — including grants — out there for vets!

For example, in addition to all of the federal and state loans that are available to small businesses and startups founded by veterans and non-veterans alike, the government also runs a few loan programs specifically for veterans. There are also private loans for veterans and training programs to help vets who want to become entrepreneurs or who want to improve their entrepreneurial skills. Basically, there are a bunch of great options of veteran entrepreneurs, including but not limited to grants!

Click here for more information on government grants (and other funding opportunities) for veterans.

Grants for women

Business grants for women is a popular topic — and no wonder. According to research from Kaufman, 40 percent of first time entrepreneurs in the United States are women. Even more impressive? The number of women-run businesses in the US is growing at twice the rate of man-owned businesses. The rate of women starting businesses and startups throughout the country is at an all-time high.

But women aren’t getting nearly as much money for those businesses as men are. In the startup world, women founders got only 2 percent of VC funding in 2017. That means women are forced to look to other money sources when they’re looking to launch a startup or small business. With access to that funding source so dramatically limited (some might even say unaccessible) many female founders are looking for business grants for women.

Another women-only financing option for people look for business grants for women is women-only incubators and accelerators. Incubators and accelerators both offer varying combinations of funding, workspace, mentorship, and community.

While many women-only incubators and accelerators are based in bigger metropolitan areas, it’s worth doing search for women-only incubators and accelerators in your region, as this is an area that has seen a lot of growth in recent years. It seems like maybe the tech industry is starting to recognize how important it is to include women?

In addition to instructions for searching on government databases, we’ve listed out a few government grants for women. We’ve also included private small business grants for women, investors who are looking specifically to invest in woman-founded startups, women-only crowdfunding sites and equity financing platforms, and women-only incubators and accelerators.

Click here for more information on small business grants for women, as well as other funding options.

Grants for immigrants and minorities

While there aren’t too many small business grants that are specifically for immigrants and other minority groups, they do exist! Refugees in particular may find that they have more options than other groups for small business grants.

The federal government also has the Minority Business Development Agency, which helps women and minorities grow their businesses. They often have grant opportunities, so definitely check them out!

How to get a business grant

Your best bet for finding a business grant is Grants.gov, which is a searchable government database of all the government grants currently available.

You should also check back periodically, as government grants for small businesses end and are added frequently.

Here’s how to apply for a federal grant for small business on Grants.gov

Grants.gov has a clear process for learning about and applying for federal grants for small businesses:

• Learn about grants
• Check eligibility
• Search grants
• Register
• Apply for a grant
• Track your application

You can click on each term to be brought to the relevant, but here’s a quick overview of each step:

Step #1: Learn about grants

The Learn page includes a video explaining how Grants.gov works, a community blog to help guide potential grantees, and a series of topics about government grants, including “Grants 101” and “Grant Policies,” among others.

Step #2: Check eligibility

The Check Eligibility page is really important — don’t skip this one! This site helps you figure out whether or not your startup is even eligible to apply for a federal grant. They list some general requirements and also point you toward other resources to determine whether or not your startup is eligible.

Step #3: Search grants

Searching grants is probably pretty self-explanatory. It’s where you search for grants! You can search by keywords, opportunity number, or CFDA, as well as more specific criteria.

Step #4: Register

Once you’ve learned about the grants, checked your eligibility, and searched for the right fit, you have to register yourself and your company. The Register page includes links for registration, as well as links out for more information about the process, and an explanatory video.

Step #5: Apply for a grant

And now, finally, it’s time to apply! The Apply for a grant page includes instructions on how to use Workspace, which is the system that grants.gov uses to manage applications. It also gives various options for the type of application you’re going to fill out, depending on the level of complexity and sophistication your company is at.

Step #6: Track your application

Just like an order from Amazon, you can track the status of your grant submission. The Track your application page asks for tracking numbers to locate your submission and give you all the info you need to know about where in the process your application is.

How to get state and private business grants

When it comes to finding state and private business grants for your startup, it’s time to utilize those search engine skills! Isolate a few keywords that describe your business and then search them in combination with “grants” or “business grants.” Also try adding your geographical location. You might be surprised to find industry-specific grants that will help boost your startup to the next level.

Other funding sources

Don’t miss our guides to the full range of startup funding options, below.

Federal Government Grants for Small Business: What You Need to Know

Venture Capital: What It Is & Why Use It

Series A, B, C, D, and E Funding: How It Works

What is Crowdfunding?

Types of Crowdfunding: Donation, Rewards, and Equity-Based

Private Investors for Startups: Everything You Need to Know

Convertible Notes (aka Convertible Debt): The Complete Guide

Small Business Startup Loans: What You Need to Know