Posted by Shivali Anand
October 5, 2021 | 4-minute read (661 words)
One of your main worries when starting a business is finance. You are fully aware of your lending options, from venture capital funding to loans to bootstrapping. But many firms overlook the possibilities of grant programs.
Many entrepreneurs are hesitant to apply for grants perhaps because there is so much misinformation about them. The application process can be daunting, and the competition is often fierce. For many small businesses, however, the potential advantages far exceed the negatives.
Check out the following common sources of small company grants if you're interested in applying for one.
Federal grants
You won't have time to operate your business if you try to sort through the dozens of government grants offered individually. To narrow down your possibilities, go to Grants.gov or utilize its companion mobile app to look for grant opportunities relevant to what you're doing.
For example, if your company makes maritime technology, searching for that phrase returns almost 20 pages of results outlining grants (at the time of publication) linked to maritime technology. Sort the results by posting the date and deadline, and then apply for the ones most relevant to your company.
Also, investigate grants offered by the U.S. Small Business Administration. Check out these funding opportunities from the SBA.
SBIR
– The Small Business Innovation Research program awards grants to companies that want to research programs that could be commercialized. SBIR awards are divided into many parts, with Phase I funding worth up to $150,000 for six months and Phase II grants worth up to $1 million for two years. The money comes from various federal departments, including the Department of Agriculture, the Department of Energy and the Environmental Protection Agency, among others.
STTR
– The Small Business Technology Transfer program also offers grant money to businesses, but as part of the financing, recipients must work directly with research institutes. The financing requirements are like those for SBIR projects. You'll work with government organizations such as the Department of Defense, the National Science Foundation or NASA, among others.
State and local grants
Grants aren't just available from the federal government. They are also extended through state and local governments. There may be fewer applicants because the pool is smaller. The options shown below are only a small sample of what's available:
- Historic preservation grants are available from the San Francisco Office of Economic and Workforce Development for individuals conducting preservation work in the city. This is only one of the several possibilities in San Francisco.
- The Small Business Improvement fund in Chicago helps local companies repair or modify their buildings by providing grants to pay a portion of the costs.
- Miami-Dade County, Florida, provides mom and pop small business grants as a form of assistance to small companies to purchase equipment and supplies, to undertake marketing, procure insurance, buy inventory, implement security systems, begin renovations and other expenses.
Visit the U.S. Economic Development Administration website, the Small Business Development Center, your local chamber of commerce, or your state business association to learn more about local and state grants.
Grants for specialty and corporate purposes
Some small company grants are only available to those who fit specific categories. For example, there are grants for women, veterans, minorities and other organizations, as well as corporate grants. A handful of these corporate grants are included here, although this is by no means a complete list.
Etsy's Maker Cities Grants
. Etsy gives funding to groups that aim to make their communities more inclusive and diverse. The FedEx Small Business Grant Contest
. Every year, FedEx provides money to at least 10 startups to help them develop. Not only do the businesses benefit financially, but they also benefit from FedEx's guidance.Visa Everywhere Initiative.
Visa awards grants to companies who win its yearly challenge by proposing creative solutions to business obstacles.
Many other grant alternatives are available, and researching grants that a company could be eligible for should be a part of your well-rounded fundraising plan.
