For any business, a grant is a solid method for funding because you don’t have to give it back. The types of small business grants available are growing in number, which adds to the chances that you will be awarded.
Here’s everything you need to know about small business grants, including who is eligible, the options available and how you can apply.
A small business grant is money awarded to help fund small businesses and nonprofits on their path to success. Governments and private organizations offer small business grants. You can consider a grant to be a gift, because it doesn’t have to be paid back. Unlike a loan, a grant requires no collateral, fees or interest.
Although the money is free, a grant may come with terms attached. The grant-giver may speculate how you can use the funds. For example, a grant may be provided to hire more employees, so if you use the money to buy equipment instead, you’ll have to pay it back. You may also face legal ramifications.
Eligibility for grants depends on who’s giving them. For example, a government small business grant won’t be provided to cover operational expenses or pay back debt. Government grants are most attainable for nonprofits related to medical research, technology and education.
However, organizations provide small business grants for:
As alluded to, grants come from two main sources, namely the government or private organizations. Private organizations like charitable foundations may also offer grants.
Although it would be helpful to have, there isn’t a centralized database for all grants. Instead, you have to search for specific types of grants based on your needs. But, we’ve compiled a quick list of places to start.
Government Grants:
Private Corporation Grants:
Foundation Grants:
Free money is the best funding method, but it doesn’t make it the easiest. Since you don’t have to pay back the grant, organizations do have to be highly selective in who they award the money to.
For starters, the application process tends to be lengthy (but, let’s face it – it has to be that way). To begin, it’s best to find a grant that specifically meets your needs. Then, you can follow these best practices to boost your chances of winning the money:
Small business grants are highly competitive. Whether they come from the government or organization, it requires that your business fits the requirements perfectly like a puzzle piece. When applying for small business grants, it’s also a good idea to have other funding methods in mind in case you aren’t awarded with the free money or need more.
For some, a merchant cash advance may be the right fit! A merchant cash advance offers you money upfront in exchange for a portion of future credit card sales. If you experience a slow month of business, then the money you pay back becomes a function of your sales, so it can be less stressful than having a fixed rate on a loan.
No one would refuse getting free money to help set their business up for success. For this reason, small business grants are highly competitive and not always the right fit for every small business. But, if you can find a small business grant that aligns with your needs, then it’s worthwhile to take the time to apply meticulously.
At the same time, you can check out merchant cash advance options. It’s just another useful low risk way to secure business funding quickly.
Most experts can agree that business growth happens in at least four stages. We’ve outlined the steps your business will take and what you should focus on at each stage.