Here are all the essential tips you need to get started
Small business grants are a hot topic, but successfully getting one isn’t easy! Depending on your industry, it can be challenging to identify grants you are eligible for and complete all the steps to success.
It’s our mission at Invoice2go to promote the success of small businesses. This guide will help you find a small business grant based on your industry and walk you through some actionable tips to help you create a winning application. We’ll help you identify and overcome some of the more common obstacles applicants face in the process, decoding the fine print to increase your chances of getting the funds you need.
First Things First: What Is A Small Business Grant?
Simply put, a small business grant is “free” money given to a business entity from a funding source, like the government, a private organization, or a charitable foundation.
A grant is not a loan, you don’t have to pay it back, and it doesn’t affect your company’s credit score. However, that doesn’t mean there are no restrictions on what you can do with the money. If you don’t follow the rules, which might involve submitting receipts or reports, you might have to pay it back.
Most grant programs have stringent eligibility requirements you must meet before your application is considered. It can’t be stressed enough—research grant programs before you apply to ensure you are eligible to receive them. You certainly don’t want to waste your time jumping through hoops if you aren’t a candidate.
Further to that point, if you don’t quite meet the minimum criteria, don’t bother trying. For example, if the application is open only to small corporations of 50-100 employees and you’ve only got three, there’s no point in applying.
How Will You Use The Money?
Depending on the granting program you apply to, there might also be limits on how you use the money. It’s essential to be sure your plans for the money meet the criteria before you spend a lot of time and effort completing the application.
Once submitted, there is no guarantee you’ll get the funds. However, if you understand precisely what the organization is looking for, what they prioritize, and your company meets the requirements, you’ll at least be in the race.
Who Gets Small Business Grants?
Small business grants go to businesses based on a range of factors. Many target minority-owned, women-owned, or veteran-owned companies. Others support social change, innovation, transformation, rural area businesses, or non-profit groups.
Currently, there are additional avenues open to small businesses seeking COVID relief. In truth, the number of funding opportunities is vast, and finding the right fit for you might be the biggest challenge. Ideally, you want to find programs that speak to you as a business owner and the business area you are looking to improve.
While it’s tempting to apply for grant money that has a broad scope, keep in mind that the less focused the criteria, the more applications the granting organization will receive. If you fit into a niche group, you’re more likely to come out ahead, so don’t hesitate to leverage your advantages. Use it!
Types of Small Business Grants
To get you started on your search, here are a few small business grant programs sorted into a few key categories:
COVID-19 Small Business Grants
There are numerous COVID-19 stimulus and recovery grants available right now,
Federal and State Small Business Grants
Search federal grants based on your industry and location at Grants.Gov. They have recently introduced a chatbot to help you navigate the site, which might help you narrow the field a little bit. They also have a searchable database where you can enter keywords and filter criteria. There are thousands of grants on the site, so it’s easy to get overwhelmed!
Challenge.Gov is a federally endorsed granting program designed to engage and support innovation through prizes awarded to businesses, students, innovators, and researchers across various demographics and disciplines.
Essentially, it’s about problem-solving for the government and the American public, so if you have an invention or a solution that answers any of the issues they are trying to solve, you might find something interesting here. Projects and solutions funded through government-funded prizes include self-driving vehicles, a space toilet, and even the architectural design for the Whitehouse itself.
GrantWatch.com is a paid service to help you search and apply for federal, state, and regional grant programs. To be clear, you don’t pay to apply, but you are required to become a member. Pricing is currently $18 for a week, $45 for one month, $90 quarterly, or $199 for a year. The site is well-organized, easily searchable, and continually updated with new information. So if you’re looking for a way to cut through the chaff and get straight to the good stuff, it’s worth investing in a week to see how you fare.
State And Regional Small Business Grants
Individual states offer their own granting programs, but some of them also administer federal funds. Federal grant programs are much more competitive—more people, more applicants—so finding something closer to home might yield better results.
Start by researching what’s available in your state and work your way down to the county and municipal levels. The State Business Incentives Database is an excellent resource for state funding; however, it requires a paid membership. Though it’s not cheap (the basic plan is $345), it is a one-time fee. Be sure to understand all the benefits to see if it’s right for you.
Your local Business Association, Business Development Center, and Chamber of Commerce are there to support you with various business tools, advice, mentorship, and help in finding financial support. They provide valuable services at no cost to you, although you might have to become a member to gain access in some cases. To find a Small Business Development Center near you, use this tool.
Corporate And Private Small Business Grants
Federal and state grant programs are just one avenue to explore. Corporations like Visa, FedEx, and Patagonia run yearly contests or pitch competitions with attractive awards and prizes. Even if you don’t win, you could be in line for business recognition, publicity, or various other perks.
You might also consider researching large corporations in or adjacent to your industry niche. In some cases, more prominent companies fund startups doing things related to their business area.
Specialty Small Business Grants
The NASE Small Business Grant is open to members of the National Association of the Self-Employed. They award one $4,000 grant each month for specific business activities, like hiring, marketing, or expansion. You’ll need to purchase a yearly membership to be able to apply right away. If you’re going month-to-month, there is a 90-day waiting period before you can apply. Sign up for a membership here.
Demographic-based and industry-specific grant programs are available to minority-owned, women-owned, veteran-owned, and first nations-owned small businesses.
The Amber Grant for Women awards $10,000 every month to a women-owned business. At the end of each year, they choose one of the year’s grant recipients to receive an additional $25,000. The eligibility criteria are broad and straightforward, so expect the competition to be fierce! Here’s where you’ll benefit from a compelling narrative that helps you stand out. Apply here.
The Veteran Small Business Award grants up to $15,000 to veterans or spouses of veterans to help them launch small businesses. StreetShares Foundation administers the program, and upcoming deadlines for 2021 have not yet been announced. Check their website or social periodically for announcements.
Tips On Creating A Winning Application
1. Understand The Granting Organization’s Priorities
Part of your grant research and application process should focus on gaining knowledge of the organization providing the funding. They’re generally doing it for a reason, and the more concisely you can speak to their concerns, the better chance you’ll have.
For example, say you’re seeking a grant from an organization with broad eligibility criteria, but they prioritize submissions from or related to indigenous peoples, women, rural businesses, minorities, children’s services, or disabled individuals. If you fit one of these categories or show that your business focus improves lives for these populations, it’s to your advantage to articulate these details.
2. Have A Clear Business Plan
There is more than one reason to have a well-thought-out business plan. Beyond being a tool to help you articulate your business focus, prospects, and future goals, it emphasizes and demonstrates you’ve done your homework and that your business model is viable.
Business plans are essential for any new business as they will help you identify, understand, and work through any potential problems. Ultimately, by the time you finish your plan, you’ll know if the idea is going to fly. For existing businesses, the plan is a dynamic template to grow on. You’ll periodically refer to it to gain clarity around long and short-term goals.
When you’re looking for funding, whether it’s through granting programs or a small business loan, you’ll almost certainly be asked to provide a business plan. If you haven’t created one, now’s the time. There are plenty of good business plan templates you can download from the web. Don’t get too bogged down in the financial details at first—focus on what your company does, who it helps, and what problems it solves.
3. Write A Clear And Complete Application
Most grant programs are inundated with applications. As a result, grant adjudicators don’t have a lot of time for incomplete or ineligible applications. We’ve spoken a bit about ensuring you are eligible for the grant before applying, but it bears repeating. If you know you’re not eligible, do not waste your time!
In the same spirit, if you know you can’t submit a complete application before the deadline, don’t bother trying. Wait for the next deadline, and ensure you have the required materials ready to go. Rushing through a grant application is a recipe for stress and failure. If you’re not thinking clearly, it’s easy to miss small but crucial details, and you want to avoid that.
The only thing that’s guaranteed to come out of an incomplete or poorly written application is relegation to the “round file.” You don’t appreciate other people wasting your time, so extend them the same courtesy.
While you’re researching your options, make yourself a checklist of what you’ll need to submit and have it ready to go. Chances are, most programs will ask for very similar documents and details, so keep them organized in a folder on your desktop so you can find and attach them when needed.
4. Communicate Openly With The Grant Officers
There’s no shame in reaching out to grant officers for help with your application. That’s what they are there for—to help you succeed! If you have a question or need clarity on a point or two, be open and transparent. Asking for help when you need it could mean the difference between getting in front of the committee or not.
The better you understand the process and the goals of the organization you’re applying to, the easier it will be to focus your attention on the right things. For example, you might be concerned that you’re a new business and don’t have any sales. Having a conversation with the grant officer may clarify how essential or unimportant those details are. Sometimes it matters; sometimes it doesn’t. Don’t sweat the small stuff—but do get to know what the small stuff is; that’s the crux of it.
Ready to Apply?
Whether you’re looking for funding to kickstart a new company or transform your existing business, a grant can help. As the world recovers from COVID-19, it’s important to plan for a sustainable future, and free money is always welcome.