Financial uncertainty and the fear of creating debt deters many small business owners from growing their successful small businesses into larger companies. In many cases, these small business owners are still paying off debt from starting their business, so the idea of investing more money to grow is daunting.
If this is your predicament, then you’ll be glad to learn that an alternative exists – small business grants. A small business grant is a sum of money given to a small business owner by either the government or an investor. This money is intended for growing a promising business.
More About Getting a Business Grant
Grants aren’t normally given to businesses that aren’t yet running, so if you’re looking for money to start a business from the ground up, a small business grant might not be for you. Getting a business loan, or perhaps even funding your new business from your savings is a better option.
If you already have a successful business and your believe your business shows a lot of growth potential, a small business grant can help you get the funding you need to expand.
However, while many business owners think of getting a grant as “free money”, this isn’t the case. Yes, small business grants are free money in the sense that the money will help you stay completely debt free while you’re growing your business – but as you might’ve guessed, there are some strings attached.
Here’s everything you need to know about small business grants, and how you can establish whether a grant is the best thing for you.
Pros and Cons of Getting a Small Business Grant
The benefit of getting a small business grant clear: you get a sum of money invested into your business directly from an investor. This money is debt free and you can use it towards growing your business. If you currently have any growth ideas for your business, but you don’t have the funding to implement them, a grant can help you turn your growth concepts into a reality.
There are some great benefits to receiving a small business grant, these benefits include:
- Grants are rewarded based on your company’s merit, so getting a grant will greatly boost your reputation for the better
- Once you’ve received one grant, you stand a better chance of receiving more grants in the future, which can open up many growth opportunities for your business
- Receiving a grant helps you manage the financial risks of growing your small business
These benefits are great, but unfortunately, small business grants also come with some disadvantages:
- Small business grants are difficult to get. Most applicants who apply for a grant, don’t receive one
- The grant issuer will usually have specifications in place regarding how the money from the grant should be used – meaning you won’t be able to use the grant money freely
- The application process can be long and drawn out. You’ll find yourself having to jump through multiple hoops in order to get grant money
- You might have to wait more than a year before you get a grant, so it’s definitely not a short-term funding option
When weighing up the benefits and disadvantages of applying for a small business grant, it’s clear that grants aren’t suited for all businesses. However, if you still believe that getting a grant can help you grow your business, then you’ll need to know what steps to follow if you want to apply.
How to Apply for a Small Business Grant?
Before you can apply for a grant, you’ll need to know where to find potential grant issuers for your business. There are many grant programs available from both government and private entities.
Finding a Suitable Grant Program
Your first task will be to find a grant program that can work for you. In many cases, these grant programs are aimed at increasing social responsibility and societal awareness. Grants can also be given based on how innovative or groundbreaking your company is in its industry.
Some grant programs are aimed at helping businesses that stand for a cause, such as helping disabled persons or recycling waste. Any cause that improves society may be eligible.
Other grant programs are aimed at helping certain sectors of the population grow successful businesses. For example, a grant program might focus on supporting veteran-owned businesses, or helping persons who belong to a minority group.
The good news is that finding a grant program that’s specifically aimed at helping a business like yours can make getting a grant easier. So it’s worthwhile putting the necessary time into learning about different grant programs available from both the government and private entities.
When looking at government grant programs, it’s important to widen your search as much as possible. Make sure you know about all the relevant grants offered by local, state and federal programs.
Preparing for a Small Business Grant Application
There are a few things you need to do before you apply for a grant. Firstly, you’ll need to know exactly how you plan on spending the grant money. Having a proper plan in place will help grant issuers see that the money spent on your grant will be used wisely. Chances are, the grant issuer will limit you with regards to how you can spend your grant money based on the objectives you state in your grant application, so it’s worthwhile to be specific.
Next, you’ll need to compile a business plan. This ties in with your initial objective. Your business plan will expand on the details of how you aim to achieve your objective based on a step-by-step plan. This can include budget plans, as well as your long-term plan for your business.
To give grant issuers an insight into the current state of your small business, add business records dating back to at least three years.
When writing your grant proposal, be sure to use a highly professional tone. Also focus on delivering a flawless final draft, as this is important if you want to make a good first impression.
20 Tips to Get a Small Business Grant
Now that you know more about the process of applying for a grant, here are some great programs that you can apply for, you just have to find the one that’s right for your industry or business.
Where to Find Grant Programs
Knowing where to look for small business grant programs is important if you want to get a grant, here are some suggestions of where to look.
This website is where you can look to see what federal grants are available at the moment.
This website is similar to Grants.com. It also focuses on federal government grants for your small business, but it’s a bit more modern. Looking on both platforms could help you find appropriate grant programs more quickly.
This website offers isn’t really for grants. Instead, prize money is on offer for solving problems within certain industries. A lot of the challenges are related to the technology industry.
4. Search the Websites of Relevant Government Departments
If your business is in the education sector, then look on the website of the Department of Education to see if there are grants relevant to your business. If you run an agricultural business, then you may find something good on the website of the Department of Agriculture and so on. Whatever industry your business works in, there is a relevant government department that may have good grant programs for you.
This grant program is fiercely competitive and it’s focused on businesses that make a difference in their community. If your business is focused on making a difference, this can be a good business grant to apply for, just keep in mind that you chances of winning are rather slim.
This grant offers up to $50,000 to the grant winner and is aimed at businesses that have innovative solutions.
7. Palm Beach County Job Growth Incentive Grant
If you’re located in Palm Beach County, or planning to relocate your business there, then this grant may be just the thing for you! The aim of this grant program is to assist businesses in creating new employment opportunities, so if your business plan involves hiring a larger base of staff in the county, you can benefit.
If your business is small, and it’s located in Miami, this grant could help you grow. The grant issues money to be spent on advertising/marketing, supplies, equipment and more.
This website can help you keep an eye on a lot of different small business grants in Florida and other areas. However, it is a subscription service, so it’s not free. There are different plans available at different costs.
10. Consider Crowd Funding
If your business is working for a good cause, there’s a good chance you can get some money from crowd funding platforms. This isn’t really a grant and you probably won’t raise thousands of dollars, but it could be worth a try.
Grant Application Tips
To continue our list, here are some tips for you can do to stand a better chance at getting a grant.
11. Start Small
First apply for smaller local grants before trying for big, corporate grants that pay out large amounts of money, as this will help you establish a good reputation.
12. Focus on How Your Business Can Make a Positive Impact
If you’re planning to create new employment opportunities, or if your business in built around a good cause, be sure to mention it in the grant proposal.
13. Apply for Grants Based on Your Background
If you’re a woman, you belong to a minority group or you’re a veteran, than there are some great grant programs to assist you.
14. Always Be on the Lookout for New Grant Programs
A big part of getting a grant is simply knowing what small business grant programs are available. Don’t stop looking for programs that can work for you.
15. Be Specific About How You’re Planning to spend Grant Money
Your business plan may seem great, but if you don’t have a detailed budget for how you’ll spend grant money, it all just seems like ideas on paper.
16. Tailor Each Grant Proposal to Fit the Program
You may be tempted to send out the same grant proposal to apply for various grants, but this isn’t a good idea. Change your proposal up to meet the specifications of whatever program you’re applying for. If, for instance, you’re applying for a grant program that focuses on empowering women, mentioning how you, as a female business owner are planning to use grant money in a way that benefits women.
17. Be Enthusiastic and Driven
If your grant proposal looks uninspiring, no one will even notice it. Your grant proposal is all about making your business seem alive with exciting possibilities.
18. Be Patient
Getting a grant may take some time. If you don’t get the first few grants you apply for, don’t give up.
19. Consider Alternatives
Getting a loan isn’t ideal, but in some cases, it can help you expand your business more quickly than a grant. Other alternatives include paying for business expansion from your savings or finding investors. These methods definitely involve sacrifice or compromise, but if can definitely pay off.