Grants to help small businesses grow and succeed are available from a variety of sources, including federal, state, and city governments, as well as a wide range of philanthropic organizations and corporations. Applying for these grants can take some time, but if you can get them, they have some significant advantages over small business loans. Most importantly, the grant does not need to be repaid.
- Many grants for small businesses are available from the federal, state, and local governments.
- Most grant programs accept applications online.
- Please make sure your business meets the eligibility requirements before applying. Some of the requirements may be very specific.
- Keep in mind that small business grants, especially federally funded grants, are highly competitive and you may not be successful on your first try.
How to find small business grants
The first step in applying for government grants and other small business grants is to identify one or more grants for which your business may be eligible. In fact, this can be the most time-consuming part of the entire application process. Here are some helpful resources.
About federal grants
Start with Grants.gov. This site provides a guide to federal grants and search tools to help you find the right grant.
One of the most common places to obtain business grants is the U.S. Small Business Administration (SBA). The SBA provides grants to small businesses based on a variety of qualifications, including the industry of the business and the background of the owner, including gender and minority status.
Other federal agencies that employers can consider for potential grants include the Department of Agriculture (USDA), Department of Energy (DOE), Environmental Protection Agency (EPA), U.S. Economic Development Administration (EDA), and state agencies. there is. National Institutes of Health (NIH).
About state, local, and other subsidies
Your state or local government may also offer small business grants and loans. These can be found in the Community Economic Research Council's State Business Incentives Database.
Finally, the Small Business Development Center (SBDC) may also be able to help you find grants. There are approximately 1,000 of these centers across the country, so you can find one near you.
Steps to apply for small business subsidies
Due to the wide range of sponsors and available grants, it is difficult to describe a 'general' application process, but it can generally be broken down into three main steps.
1. Check your eligibility
Find out if you qualify for a grant before you spend time applying. This will save you and your reviewers a lot of time. Every grant has a goal, and to achieve that goal, you must follow a set of requirements set by the organization for grant recipients.
Eligibility requirements may include the size of the business, the minimum amount of revenue the business brings in, the gender of the business owner, the type of activity the business is involved in, and more.
2. Collect the necessary backups
All grant applications require specific documentation, so be sure to organize all relevant information before applying to streamline the application process.
Information that may be required as part of your grant application includes:
3. Invest time in your application
The complexity of a grant application and the time required to complete it vary depending on the sponsoring organization and the type and size of the grant. For example, a federal grant may involve many steps.
Number of small businesses in the United States as of 2019, according to the latest SBA data available in March 2023.
Tips for qualifying for small business grants
Business grants are a very attractive source of funding for small businesses and therefore tend to be very competitive. This is especially true for federal grants. State and local grants may be less competitive, but applications should be taken seriously to have the best chance of success.
Here are some tips to make your application as competitive as possible.
- Please read the purpose of the grant. Please be sure to state the purpose of the subsidy in your application. From a sponsor's perspective, the best applications are those that have a clear understanding of their purpose.
- Spend time on your business plan. A well-written and well-written business plan is probably the most important part of your application. Take the time to make sure yours is of the highest quality, detailed, polished, and able to answer any questions you might expect.
- We will explain how the grant will be used. Most small business grants are intended to be used for a specific purpose, so make sure your business plan shows how that purpose is indicated. The more details you can provide here, the better.
- Check funding match requirements. Some grants require you to match the sponsor's funds with your own. Before you apply, determine whether you can actually come up with the funds.
- Please apply early. largely The funding pool for the grant program is limited and once funding is exhausted for the year, consideration of applications will cease. Please pay attention to deadlines and apply as soon as possible.
All these considerations may seem like a lot when you first start applying for grants, but most businesses find that it gets easier over time. Once you get used to preparing all your documents and writing them in a way that grant officers understand and prefer, you'll find that applying for grants becomes much easier and ultimately has a higher success rate.
What is considered a small business?
Although definitions vary, most manufacturing businesses with 500 or fewer employees and nonmanufacturing businesses with average annual revenues of less than $7.5 million meet the criteria for classification as small businesses, according to SBA regulations. .
Why is my grant denied?
There are many reasons why grant applications fail. You may not be eligible for the grant. Or you may not have been clear enough about how the grant will support and develop your business. Or maybe your application was great, but your donor received so many applications that they couldn't fund you this time.
Are small business grants taxable?
Yes, with very few exceptions, subsidies to businesses are subject to tax. Proceeds from business loans, on the other hand, are not considered income and are not taxed.
Grants can be a better option than loans because they are like free money that you don't have to pay back and don't charge interest like loans. Applying for grants can be competitive and difficult, but it may be worth it for your business.
Success can be achieved by spending serious time researching suitable grant opportunities, ensuring that your application addresses the grant sponsor's objectives, and applying early, before funding runs out. can maximize the probability of