“When looking for funding, don’t just look for cash. Look for the right people.” — Jodie Fox, Director of Fashion and Founder of Shoes of Prey!
Planning to obtain funds for your startup is the biggest challenge, isn’t it? When in doubt, you must always remember the above-mentioned quote. And, all you have to do is to look for the right places.
There are a number of startup business grants available to assist you to launch your company. Moreover, a grant that meets your requirement and needs will help to boost your startup.
While small business entrepreneurs may hope to receive grants to help support their venture but it’s a competitive process. However, you may be successful in obtaining free money for your business if you know where to seek and how to apply.
In today's guide, we've covered some of the best startup business grants to look for, as well as some of the related concepts. Let's take a peek at what we'll be discussing further:
- Understanding Startup Business Grants
- Startup Business Grants Working
- Different Types of Startup Business Grants
- How You Can Apply for Startup Business Grants?
- Top Startup Business Grants
- Startup Business Grants Alternatives
- Pro-Tips to Win Startup Business Grants
- Things to Consider When Applying for Startup Business Grant
- Frequently Asked Questions Associated with Startup Business Grants
- Conclusion
- How Deskera Can Assist You?
Let’s Explore!
Understanding Startup Business Grants
A startup business grant is an amount of money given to small firms that do not require repayment, unlike business loans. Government institutions, private corporations, and other entities frequently provide business grants.
However, one downside of business grants is that many will not be able to qualify, and those that do will face stiff competition.
Startup Business Grants Working
Startup business grants are awarded after a rigorous application procedure and only if your company meets all of the prerequisites and restrictions.
Moreover, the most appealing aspect of grants is that they do not require business owners to repay the financing source. However, there are usually conditions that govern how the funds are utilized within your company.
If your grant is for technological research, for example, you cannot utilize the funds to supplement your salary or other commercial expenses. Otherwise, you may be obliged to return the entire grant amount to the supplier.
Different Types of Startup Business Grants
Business grants are not "one size fits all." Based on the type of business you run, your location, or who you are, you may be eligible for a variety of grants. Furthermore, federal, state, corporate, and specialized grants are the four types of business awards.
State Small Business Grants
Small company grants are also offered at the state level. Small company incentives from the state range from grants for innovative enterprises to grants for rural businesses.
However, the application procedure can be challenging, though, because many of these scholarships aren't especially specialized.
Corporate Small Business Grants
Small business grants are offered by some large organizations, such as FedEx or Visa, to help entrepreneurs. You can often acquire big quantities of money to spend towards your business needs if you compete for and win grants offered by huge corporations.
However, because competition for these funds is fierce, whether it's a contest or a pitch competition, you'll need a strong strategy to compete.
Federal Small Business Grants
The majority of funds offered to small enterprises come from the federal government. The application procedure for federal small company grants might be lengthy, but it is worthwhile if you are eligible for financing.
Furthermore, education, environmental research, medical research, and technology are the most likely candidates for a government small business award.
Specialty Small Business Grants
Private corporations, organizations, and the US Small Company Administration (SBA) provide specialist small business awards that assist certain communities in order to make entrepreneurship accessible to people of all demographics.
Further, small business owners that are minorities, women or veterans may be eligible for special small business subsidies.
Small Business Grant for Minority
Minority-owned enterprises are important areas. This group of entrepreneurs has specific hurdles, including obtaining capital.
Many organizations and agencies, fortunately, aid enterprises such as creative Black-owned startups and Native American projects and organizations with funding.
Small Business Grant for Veterans
There are several well-deserved grant choices available for veterans who have created enterprises after serving our country.
There are several potential funding possibilities for veteran-owned small businesses that fit at every level of operation, from grants to getting their business started through support once they've started running.
Small Business Grant for Women
Securing finance for any small business can be difficult, but it can be even more difficult for women-owned small enterprises. Small business grants make it easier for women-owned enterprises to get capital.
Small business grants for female-owned small enterprises that contribute to social change, as well as jewelry manufacturers, are available from organizations that strive to promote female entrepreneurs.
How You Can Apply for Startup Business Grants?
The majority of grant providers will advise you on how to qualify for their grant and what evidence you must provide.
It could be as simple as answering a few short questions about your firm on a website or as tough as putting up several pages of business documentation with pro forma budgets, appraisals, and market studies, depending on the grant you're looking for.
To apply, simply follow the grantor's instructions. If the work appears to be too tough or complicated, call your local SCORE office to schedule a consultation. SCORE advisors can assist you with the procedure.
If you're seeking a federal or state grant that requires a thorough application, you might want to hire a grant writer to help you with the paperwork.
Top Startup Business Grants
Following we have discussed top startup business grants that you can apply for your startups. Let’s learn:
Federal and State-Sponsored Small Business Grants for Startups
Following we have listed some federal and state-sponsored small business grants for your startup. Let's learn:
Small Business Innovation Research (SBIR) program and Small Business Technology Transfer (STTR)
These two awards, provided by the US Small Business Administration, are the most significant federal subsidies available to domestic companies working on breakthrough technologies and R&D.
Further, both of these programs are competitive, involving public-private collaborations with government institutions in critical research fields. SBIR is for research-based projects, whereas STTR is for more technology-driven businesses.
US Economic Development Administration (EDA)
The EDA offers many grants divided by industry on a state-by-state basis, as well as some funding or grants to assist enterprises post-covid pandemic. Depending on your business kind, the EDA offers several grant possibilities.
The EDA grants, for example, include cash for tourism and outdoor recreation, statewide planning assistance, and economic relief for struggling firms — as well as various pitching and entrepreneurial challenges in which you might compete. On their website, you can apply directly.
Minority Business Development Agency (MBDA)
Throughout the year, the MBDA, which is part of the US Department of Commerce, offers pitch competitions and rewards for domestic minority-owned businesses.
Moreover, they also have resources and events specifically for minority entrepreneurs who are just getting started, so visit their website for more information.
Grants from the First Nations Development Institute
Keep an eye on this page for funding opportunities for Native American-owned small companies. From 1993 to 2017, this foundation awarded over 1,400 awards totaling about $30 million.
The grants are open to any form of business as long as the owner is a Native American. Moreover, you can sign up for their email list to be notified when new opportunities arise.
Rural Business Development Grants
Small rural businesses (with less than $1 million in revenue and fewer than 50 employees) are eligible for a variety of incentives from the US Department of Agriculture.
Furthermore, based on your business idea, you can apply for a variety of grants (such as whether the funds would be used for training or technical support, land or machinery acquisition, or community economic development).
However, you must demonstrate that the benefit to rural areas or towns is significant. The grants are worth between $10,000 and $500,000.
GrantWatch
While GrantWatch does not provide funds, it does maintain track of new awards that are available to veterans. It's a great way to find local grants that you wouldn't find using any of the other databases on this page.
National Institute of Health (NIH) Grants
Throughout the year, the National Institute of Health awards numerous grants to scientific, pharmaceutical, and biotech companies. Moreover, you can easily search for research grants, scholarships, and other career development resources on their website.
Corporate-sponsored small business grants
Following we have listed some corporate-sponsored small business grants. Let's learn:
The Zach Grant from Fundera:
Fundera is another company that assists businesses and individuals in obtaining loans. This $2,500 prize is only given out once a year. Unlike most scholarships, this one demands a video entry answering the question "why did you establish your own business?" and is evaluated based on three criteria:
Quality \Originality \Creativity
FedEx Small Business Grant Contest
The stakes for FedEx's small company contest are high, with three grand prize winners receiving $50,000 apiece and seven first-place winners receiving $20,000.
In addition to the cash award, awardees receive website audits, free software subscriptions, and additional services like financial or packaging counseling.
Lending Tree
Lending Tree typically offers various forms of loans, but it also hosts small business grant competitions on a regular basis. The winner in 2017 received $50,000. They evaluate enterprises based on the owners' passion and whether expanding their firm will benefit the community.
Visa Everywhere Initiative
Visa's competitive award program, which offers over $500k in total rewards, is open to fintech startups. Eligible startups include those working with bitcoin, alternative lending, blockchain, digital wallets, merchant services, retail technology, and other technologies. Visa chooses five regional finalists to compete in the global finals.
Walmart Foundation Grants
Walmart provides grants to nonprofit organizations. The grants do not have a set sum and instead fall into two categories.
The "community grant program" offers grants of $250 to $5,000 to local NGOs.
The "national giving program" awards grants of $250,000 or more to national NGOs.
Nonprofits that concentrate on opportunity, sustainability, or communities are eligible for the awards. Basically, any socially conscious company.
National Association of the Self-Employed (NASE)
If you are self-employed, you may be eligible for a monthly $4,000 stipend from the National Association of the Self-Employed (NASE). Apart from becoming a member of NASE, there aren't many conditions to meet. Although. this isn't cheap, and it's probably not worth it if all you want to do is get the grant.
Tory Burch Foundation Fellowship
Female founders of early-stage firms with revenues of at least $75k are eligible for the year-long fellowship program. Furthermore, mentorship, virtual education, peer-to-peer networking, and a $5,000 award are all provided to fellows.
Wells Fargo Community Giving Grants
Educational institutions and nonprofit organizations can apply for funds from Wells Fargo. Businesses can apply at any time of year, and the grant has no set amount. Every year, Wells Fargo distributes millions of dollars in awards.
Capital One Business Grant
Capital One's Business Grant is available to black-owned businesses. The prizes range from $5,000 to $10,000, and winners have access to Capital One's small company hub and peer network.
AT&T Aspire
AT&T is currently not taking applications for their Aspire grants, so keep an eye on this website. Small enterprises that are centered on enhancing education, particularly in high schools, are eligible for the funding.
Fearless Strivers Grant
This grant, sponsored by Mastercard, is for Black, female-owned enterprises. Each grantee receives $10,000 in addition to digital business tools, mentorship, and other benefits. This grant is available in two versions: a national version and a local version in certain US communities.
Idea Cafe
Idea Cafe is a news and information portal for entrepreneurs and small business owners. Winners receive $1,000 rewards, and it's one of the few programs that doesn't require you to already have a business. The winners are chosen by the community.
Nonprofit-sponsored small business grants
Following we have listed some nonprofit-sponsored small business grants. Let's learn:
Amber Grant
Amber Grant, which is run by WomensNet, awards more than $30k in total prizes every month, as well as quarterly and annual grants. Various types of businesses are eligible, including marketing and animal services.
Operation Hope
Entrepreneurship workshops and money are provided by Operation Hope to founders from neglected and impoverished communities, as well as those who are unable to obtain traditional loans or capital. This intense 8-week program combines business training, financial counseling, and networking to assist startups.
StreetShares Foundation
The Veteran Small Business Award, sponsored by StreetShares, provides financial assistance to veterans who want to start their own enterprises.
Furthermore, coaching, instructional content, mentorship, and networking events are all part of their grant to help military members advance their professions after they leave the military.
Open Meadows Foundation Grant Program
The Open Meadows Foundation provides grants of up to $2,000 to small enterprises that are committed to improving their communities and have a demonstrable need for the funds. It's one of the few awards that prioritizes small and startup companies.
IFundWomen Startup Funding
In collaboration with big corporations, IFundWomen offers a variety of grants. Individual awards can be applied for or you can apply to their universal database, which matches eligible entrepreneurs with suitable grant possibilities.
InnovateHer Challenge
The Small Business Administration funds the InnovateHer Challenge, an annual grant for women entrepreneurs. The first-place prize is $40,000, the second-place prize is $20,000, and the third-place prize is $10,000. It's a significant award that also comes with a lot of publicity for the winners' companies.
Moreover, to qualify for the national competition, you must first win a local InnovateHer challenge. On this map, you can observe the local sites.
Any sort of company is eligible to compete, but those that cater to women and their social issues usually perform the best.
SoGal Black Founder Startup Grant
SoGal is an online forum for varied entrepreneurs and investors that focuses on women and nonbinary founders in order to close the entrepreneurship diversity gap. Their startup grant is for Black women-owned enterprises, and prizes vary from $5,000 to $10,000.
The Barstool Fund
Dave Portnoy founded the Barstool Fund, a 30-day nonprofit organization (of Barstool Sports fame). It's intended to assist small local businesses such as restaurants, pubs, hair and nail salons, and dry cleaners in dealing with the Covid-19 pandemic. They've already provided $40 million to entrepreneurs around the country and helped over 400 enterprises.
Eileen Fisher Community Partnerships Grant
The Eileen Fisher Community Partnerships Grant is a quarterly (3-month) grant that can be up to $2,500. You must be the director of a local nonprofit with a community-oriented aim to be eligible.
Aside from that, there are a few more qualifications, including a demonstrated financial need and a connection with Eileen Fisher (any of their stores or partners).
500 Global Flagship Accelerator Program
This accelerator takes applications on a rolling basis and places entrepreneurs in the center of Silicon Valley for a four-month intense program that includes networking opportunities, business education, and a $150k investment.
Other Miscellaneous Grants
You might be qualified for some awards that don't fall into any of the above categories.
Global Innovation Exchange Funding Database
This is a global financing database that is up to date. It's a handy method to locate contests and grants you might otherwise overlook, and it's worth bookmarking.
Eugene Applebaum Dare to Dream Grant Program
These grants, worth up to $1,500, are for student-owned businesses at the University of Michigan. The awards are exclusively open to students, but you don't need to already own a firm to apply; all you need is a decent idea. It's a financial program as well as an instructional
100,000 Strong in the Americas
These rewards are only available to higher education institutions. While your small business cannot apply for these awards directly, if your company provides services to students, you could partner with a higher education school. You gain money, and they see how valuable your products or services are.
Startup Business Grants Alternatives
Even if you are unable to locate a small business grant that fit your requirements, you need not be discouraged because there are other options available for you.
Small firms have a variety of financial alternatives, including loans and business credit. Most entrepreneurs start and run small firms without the help of grants; you can, too.
Let’s check:
Personal Savings
Most entrepreneurs will use their personal savings to establish or support their new firm, a practice known as "bootstrapping." To be sustainable, this strategy necessitates self-discipline and financial commitment.
Personal Loan
A personal loan can help your company get the money it needs. It's focused on your personal credit, so no company plans or estimates are required.
If you have some equity in your home, for example, you might be able to receive a home equity line of credit (HELOC) to be used for your business.
Friends and Family Loans
Many small businesses rely on loans from friends and family to get started or grow. It is essential that you construct a good repayment plan and obtain your agreement in writing to avoid harming your close ties.
Small Business Loans
Small company loans exist in a variety of shapes and sizes, and they can be received from a financial institution or an online lender.
Furthermore, there are also lenders who will lend depending on the receivables from your online marketplace. SBA loans are government-backed and offer long terms and low rates, whereas online lenders have fewer qualifying requirements and easier application processes.
Business Line of Credit
A small company credit card might be a relatively cost-effective option to finance your business expenses if you need less than $10,000 in the capital.
Furthermore, many company credit cards provide introductory periods with 0% APRs and lucrative cashback or rewards schemes. If you use credit cards frequently, these benefits can be useful to your business.
Eventually, a business credit card is a frequent financing tool for small firms and can act as a rapid source of funds.
Crowdfunding
This option is becoming a more common way for small enterprises to raise financing. The advantage of this option is that it usually consists of a series of minor payments that beneficiaries are not required to repay.
Investors
Angel investors and Venture capitalists are two of the most common forms of investors for new businesses. Both invest money in a company in the hopes of a good return on investment; nevertheless, venture capitalists usually ask to join the board of directors or buy a stake in the company.
Pro-Tips to Win Startup Business Grants
Finding a grant that fits your needs and executing the application process might be difficult. You should start looking into your choices as soon as you recognize that a small business grant would've been beneficial to your company.
Following we’ve discussed some crucial pro-tips on how you can win small business grants. Let’s learn:
- Examine early and often: Grant opportunities can emerge out of nowhere at times. A local organization might get a community development block grant and start offering small business grants in your neighborhood. Begin looking as soon as feasible. If nothing is available today, there may be something available tomorrow.
- Give time to complete the application: Once you've found a grant you want to apply for, double-check the application deadline. Allow enough time before the deadline to completely prepare your application.
- Review the requirements one last time before completing your application to ensure that you have provided all of the relevant documentation.
- If you miss the deadline, your registration will be rejected outright.
Things to Consider When Applying for Startup Business Grant
Grant applications take a considerable amount of time and work. In order to secure funding, you may have to go through numerous rounds of interviews or pass a pitch competition in addition to completing the essential documents.
Furthermore, if you need money quickly to keep your firm solvent, check into loans or other short-term investing choices first.
Meanwhile, consider the ratio of your time to the amount of assistance and funds you'll receive from the award. Some awards are part of wider support networks, such as accelerator membership or residence opportunities. Others, such as advisers and mentors, may provide non-capital-based assistance.
Consider the following as you look for small company grants to apply for:
- The grant's competitiveness and whether you have the time to prepare a solid application
- Whether the grant's objective or vision aligns with your business strategy
- What are your plans for the grant funds? You'll need a solid business strategy for the judges to assess you.
- What sort of commitment will you need to make to the community or to a program like an accelerator if you get the money?
- Whether the grant's goal or vision corresponds with your company's goals
- How many grants do you want to qualify for at the same time, particularly if they involve longer-term commitments?
Eventually, there are many grants available, but don't try to apply for all of them at once. Filter your search as much as possible by looking for grants that correspond to your company's objectives and next growth milestone.
Frequently Asked Questions Associated with Startup Business Grants
Following we have discussed some crucial frequently asked questions associated with startup business grants. Let’s learn:
Que 1: How do grants for small businesses work?
Grants for small businesses are practically free money for your company. If your firm is selected after you find and apply for a small business grant, you will receive a lump sum of money to spend to support your business that you will not have to repay. Small company grants frequently include requirements regarding how the money must be spent.
Que 2: How can I apply for a business grant?
An application process is required to obtain a business grant. Depending on the award, the application process will differ. One grantor may need you to submit a video essay, while others might require you to submit an online application.
Start by doing some research. The first step is to look for a business grant that your company qualifies for. To compete for the award, you must first comprehend and implement the application requirements.
Looking for grants that connect with your business strategy and principles is the greatest approach to boost your chances of winning one.
Que 3: What are the benefits of business grants?
Grants for small businesses are practically free money. If you qualified for a small business grant, you will get a one-time payment that you will not have to repay.
However, you must usually adhere to tight guidelines for how the funds are spent within your business.
Que 4: What advantages do small company grants provide?
The greatest part about small business grants is that you don't have to repay them. Furthermore, many grantors and programs provide more than just funding.
Most of these programs also provide other business services such as company advice, marketing services, or further money.
Que 5: To get a grant, what kind of credit do you need?
When deciding who gets a grant, credit is rarely a consideration.
However, you'll almost certainly need good credit to get your firm off the ground before you can qualify for most grants.
Furthermore, most grants require that your small business be in excellent financial standing, which means you don't have any levels of debt that can't be paid back in a reasonable amount of time.
Que 6: Is it necessary to repay small business grants?
No! That is why they are given permission.
Unlike loans, grants do not require repayment and can be used for nearly any business purpose.
Some grants ask you to report on how the funds were used and how they aided you, however, this is usually to gain more exposure or to assist you further.
Que 7: What is the simplest way to obtain a grant?
Unfortunately, there is no such thing as an easy grant. The simplest method to acquire a small company grant is to apply for the most specialized award you're eligible for, as this will reduce the number of rivals seeking the same pool of funds.
Que 8: Is there a limit to how many grants I may apply for?
You almost never have a limit on the number of awards you can apply for. Each prize, however, can only be applied once per company.
Each year, a program may award a large number of grants. The bulk of them, but not all, allow businesses to submit multiple applications. Examine the grant information to find out.
Conclusion
An emphasis on rapid growth is one of the foundations of new companies. To boost scalability, most new enterprises will need appropriate finance.
Moreover, your company can earn free money to support projects, expand offers, and generally grow your business using startup business grants.
However, if you can't find a grant that suits your company's needs, there are other funding choices available, such as startup loans and lines of credit, to assist you to meet your financial obligations.
How Deskera Can Assist You?
Deskera People allows you to conveniently manage leave, attendance, payroll, and other expenses. Generating payslips for your employees is now easy as the platform also digitizes and automates HR processes.
Final Takeaways `
This detailed guide has now come to end. Having a large amount of data might be daunting. As a result, for your future reference, we've created a summary of essential points from this guide:
- A business grant is an amount of money given to small firms that do not require repayment, unlike business loans. Government institutions, private corporations, and other entities frequently provide business grants.
- The most appealing aspect of grants is that they do not require business owners to repay the financing source. However, there are usually conditions that govern how the funds are utilized within your company.
- Small company grants are also offered at the state level. Small company incentives from the state range from grants for innovative enterprises to grants for rural businesses.
- The majority of funds offered to small enterprises come from the federal government. The application procedure for federal small company grants might be lengthy, but it is worthwhile if you are eligible for financing.
- Private corporations, organizations, and the US Small Company Administration (SBA) provide specialist small business awards that assist certain communities in order to make entrepreneurship accessible to people of all demographics.
- Small business grants for female-owned small enterprises that contribute to social change, as well as jewelry manufacturers, are available from organizations that strive to promote female entrepreneurs.
- To apply, simply follow the grantor's instructions. If the work appears to be too tough or complicated, call your local SCORE office to schedule a consultation. SCORE advisors can assist you with the procedure.
- The EDA offers many grants divided by industry on a state-by-state basis, as well as some funding to assist enterprises post-covid. Depending on your business kind, the EDA offers several grant possibilities.
- The National Institute of Health awards numerous grants to scientific, pharmaceutical, and biotech companies. You can search for research grants, scholarships, and other career development resources on their website.
- Idea Cafe is a news and information portal for entrepreneurs and small business owners. Winners receive $1,000 rewards, and it's one of the few programs that doesn't require you to already have a business. The winners are chosen by the community.
- Amber Grant, which is run by WomensNet, awards more than $30k in total prizes every month, as well as quarterly and annual grants. Various types of businesses are eligible, including marketing and animal services.
- The Open Meadows Foundation provides grants of up to $2,000 to small enterprises that are committed to improving their communities and have a demonstrable need for the funds.
- The Small Business Administration funds the InnovateHer Challenge, an annual grant for women entrepreneurs. The first-place prize is $40,000, the second-place prize is $20,000, and the third-place prize is $10,000.
- Most entrepreneurs will use their personal savings to establish or support their new firm, a practice known as "bootstrapping." To be sustainable, this strategy necessitates self-discipline and financial commitment.
- If you have some equity in your home, for example, you might be able to receive a home equity line of credit (HELOC) to be used for your business.
- There are also lenders who will lend depending on the receivables from your online marketplace. SBA loans are government-backed and offer long terms and low rates, whereas online lenders have fewer qualifying requirements and easier application processes.
- This option is becoming a more common way for small enterprises to raise financing. The advantage of this option is that it usually consists of a series of minor payments that beneficiaries are not required to repay.
- Angel investors and Venture capitalists are two of the most common forms of investors for new businesses. Both invest money in a company in the hopes of a good return on investment
- A local organization might get a community development block grant and start offering small business grants in your neighborhood. Begin looking as soon as feasible. If nothing is available today, there may be something available tomorrow.
- Review the requirements one last time before completing your application to ensure that you have provided all of the relevant documentation.
- Consider the ratio of your time to the amount of assistance and funds you'll receive from the award.
- Some awards are part of wider support networks, such as accelerator membership or residence opportunities. Others, such as advisers and mentors, may provide non-capital-based assistance.
- Grants for small businesses are practically free money. If you qualified for a small business grant, you will get a one-time payment that you will not have to repay.
- Some grants ask you to report on how the funds were used and how they aided you, however, this is usually to gain more exposure or to assist you further.
- Your company can earn free money to support projects, expand offers, and generally grow your business using startup business grants.
- Each year, a program may award a large number of grants. The bulk of them, but not all, allow businesses to submit multiple applications. Examine the grant information to find out.
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