If you're trying to launch a business or keep it afloat, you may have discovered that accessing funds often requires a lot of time and effort. One popular but sometimes underutilized avenue to funding comes in the form of grants. The main advantage of grants is that they aren't tied to collateral and don't have to be paid back.
However, the competition can be steep, and opportunities may be limited depending on your background, industry, and company type. Make sure you understand the grant process fully to save time and increase your odds of success.
How to successfully apply for grants
When it comes to applying for grants, focus on identifying the right opportunities for your company and crafting an application that withstands scrutiny. Start by taking the following steps:
- Research grants to find ones that are the right fit. Grants often have specific eligibility criteria, such as industry, business type, company size, and location. Additionally, a grant may have a stipulated use (for example, technology upgrades, training, or research and innovation), so your needs must align accordingly. You also want to verify if a grant is only open to business owners with certain backgrounds, such as military veterans.
- Understand all the criteria and stay on deadline. Review the information you need to provide and the application deadline. Grant writing takes time; be prepared and stick to a schedule. Put the deadline and the award date on your calendar so you can keep track of when to apply and when to expect the award results.
- Be realistic about your needs and abilities. While getting "free" money sounds great, if it's awarded to your company, you must abide by the grant rules. This means you can only use the money as stipulated and adhere to often rigorous reporting and accounting standards. Consider your bandwidth and make sure you carefully follow the rules.
Local governments also offer separate business grant opportunities, which can be easier to get due to smaller applicant pools and less competition.
Where to find grants
There are many sources for grants, including the federal government, local governments, nonprofits, and corporations. below are some places to look to find a fit for your business.
Federal government-based funding opportunities
First, start your search using Grants.gov, a website offering the most comprehensive database of federal grant options for businesses. The site has thousands of grants that companies from all backgrounds can apply for. It lists federal grants from the U.S. Department of Health and Human Services, the U.S. Department of Justice, the U.S. Department of Defense, and more.
Additionally, the U.S. Small Business Administration (SBA) offers a wide array of grants and funding options. These options include programs that target business-to-business, tech, veteran, minority, and women-owned businesses.
Local government grants
Local governments also offer separate business grant opportunities, which can be easier to get due to smaller applicant pools and less competition. Grants.gov, again, will often list state and local grant opportunities. You should also check these sources to find potential funding.
- State economic development agencies: Each state has its own economic development agency that often provides grants and resources for local businesses. Search your state's economic development directory to find regional offices and local resources.
- State-specific programs: Many states earmark part of their budget for small business grants. For example, Illinois offers infrastructure grants through its department of commerce and economic opportunity.
- Local government websites: Check your city and county government websites for economic development departments, small business assistance programs, and local grant announcements.
- Small Business Development Centers: SBDCs are often associated with local universities or state economic development agencies. They provide support for small businesses with local grant opportunities, technical assistance, training, and other financing support.
Special interest business grants
Your gender, ethnicity, and veteran status can all factor into which loans your business can obtain. There are several opportunities available to entrepreneurs who meet the following specific criteria:
- Women-owned businesses: Several sites are geared toward helping women entrepreneurs, including resources and grants through Grants for Women, SBA-sponsored Women's Business Centers around the country, WomensNet, and the Eileen Fisher clothing company's Women-Owned Businesses Grant Program that promotes socially responsible women-owned businesses. Read more about grants and funding options for women-owned businesses.
- Minority-owned businesses: The Minority Business Development Agency, a division of the U.S. Department of Commerce, supports regional business development agencies that assist local minority-owned businesses. You can contact the office in your region for information on programs and resources. There are many funding options available for minority-owned businesses in general. Read more about grants and funding ideas for Black-owned businesses and more about grants and funding options for Hispanic-owned businesses.
- Veteran-owned businesses: The Second Service Foundation Military Entrepreneur Challenge features finalists on the foundation's website, three of whom get a chance to pitch their business ideas at a live competition. Additionally, the SBA offers resources and funding opportunities for veteran-owned businesses.
Corporate grants
Bigger enterprises sometimes offer corporate grants to nonprofits, educational institutions, small businesses, or community projects. Here are a few to explore.
- Verizon Small Business Digital Ready: Verizon offers a program for entrepreneurs to win $10,000, plus it offers free courses and educational materials. Applicants must participate in at least two courses, live coaching, or community events hosted by Verizon.
- Amazon Small Business Grant Program: Amazon offers free grants to small businesses with an Amazon Business account and less than $1 million in annual revenue. The program offers grants to 15 businesses, ranging from $15,000 to $25,000.
- Visa Everywhere Initiative: In this competition, hosted by Visa, entrepreneurs are invited to show their innovative fintech startup at the TechCrunch Disrupt event in San Francisco. The winner will be awarded a $100,000 small business grant, with additional grants for second- and third-place finalists, audience favorites, as well as regional and local winners.
- FedEx Small Business Grant: FedEx hosts an annual grant competition that awards a $50,000 grand prize and nine additional $20,000 grants for U.S.-based, for-profit small businesses with fewer than 99 employees.
- Backing Small Businesses Grant: Organized by American Express and Main Street America, this program offers 500 small business grants of $10,000 to eligible businesses in the U.S. and U.S. territories.
Grant alternatives and other resources
If you own a small business or are self-employed, you can access resources and apply for grants through these organizations.
- National Association for the Self-Employed (NASE): NASE members can apply for small business grants.
- Idea Café: This online portal offers resources and grant opportunities in its Small Biz Grant Center.
- SCORE: The organization SCORE helps small business owners connect with mentors and local resources, which can include ways to assist with funding.
With some discernment and a bit of time, you may find a great grant opportunity. Keep in mind that grant writing is a specialty. You may consider hiring a professional to assist you if you feel overwhelmed. There are benefits to getting outside help, but it comes with a cost. You’ll need to weigh what makes the most sense for your business.
This article was originally written by Kaylee Kolditz and Sean Ludwig.
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