Guide to the Best Government Grants for Small Businesses
Starting a business is a quintessential part of the American dream. But in today’s economy, you may find it hard to start on your own without enough economic or social capital.
Thankfully, there are many government grants for businesses available to help you get started on pursuing your dream. This guide will help you find out more about what government business grants are and how you can apply for them.
Image Source: Best Government Grants for Small Businesses
Government Grants 101
Government grants and loans are how the government funds the ideas and innovation of individuals that will improve public services and renew economic vitality.
On a state level, government grants to start a business are out there for you if you meet the requirements. Federally, there are small business government grants for preexisting companies that are making a positive economic or social difference in their communities.
The best government grants for small businesses are pretty straightforward to apply for, but it can be overwhelming to find which government startup grants you are actually eligible for.
Luckily, we’ve put together this guide on government business grants that will inform you about eligibility, finding the best government business grants, the application process, and more.
Government Business Grants Eligibility
Eligibility for government grants for small businesses depends on the individual and the business itself. For example, Service-Disabled Veteran-Owned Businesses will be eligible for more federal assistance in the form of small business government grants. Additionally, Women-Owned Small Businesses qualify for more government grants.
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As with any loan, evaluators will look at your credit score, business size, employee make-up, location, and other factors to determine your eligibility and the size of your government grants and loans.
Most federal programs will not offer government grants to start a business, but some state-level programs will offer local government grants for starting a business that benefits the local economy.
Grants.gov: What You Need to Know
Your go-to site for finding government grants for small businesses will be Grants.gov. On this website, you can browse by categories of government business grants such as agriculture, business and commerce, housing, energy, and more to find the government business grants that best fit your organization.
Image Source: Grants.gov
Additionally, you can browse by eligibilities for government grants for a small business, such as city or township governments, independent school districts, individuals, or non-profits.
Grants.gov will also be an invaluable resource in the search for government business grants as they provide information about
- The grant lifecycle
- Government grants policies
- Government business grants terminology
- Small business government grants systems
- Government startup grants programs
- Fighting government small business grants fraud
- and more.
Get Ready to Apply
Getting ready to apply for government grants for small businesses isn’t as hard as you might think.
1. Choose between individual and organization registration for small business government grants.
Are you an independent business owner, or will you be applying as an organization? This will affect which government business grants you can be eligible for.
2. Improve your credit.
As with any grant or loan, your credit should be fairly good to qualify for government grants for small businesses. Since government loans and grants can be competitive to get, before applying, do what you can to improve your credit.
3. Determine your financial needs.
Generally speaking, smaller requests for government grants are prioritized over larger requests. Make sure you can specify exactly what your business government grants will be used for, as exhibited stewardship of a grant will increase your chances of getting small business government grants and loans.
4. Gather additional info.
If you need help figuring out what information an application for a government grant for a small business will require, check out the grant forms information available through Grants.gov. Details about form instructions, status definitions, the process, and retired forms are available for your better understanding of government grants forms. It’s important to have a plan in mind for the structure and needs of your business when applying for government grants for a small business.
Consider Your Niche
You are what makes your business idea unique. Perhaps you’re a single mother starting her own business, or you will be helping to serve the needs of underserved communities. It will help you in the journey of finding government grants for small businesses to know what sets you apart from other companies.
Image Source: Government Business Grants
This can be beneficial beyond the search for government grants, as you will be able to summarize effectively what makes your company different when pitching to potential investors. Here are some potential categories that your business may fit and thus be eligible for related government grants for businesses.
1. Government grants for women
Every year, the U.S. Small Business Administration hosts a competition for government grants for small businesses with a product or service that improves the lives of women. This challenge is called the local InnovateHER Challenge, and the top three competitors win government business grants of $40,000, $20,000, and $10,000 respectively.
If you are a woman entrepreneur, there may be opportunities for government grants to start a business available to you on a state and local level.
The U.S. Small Business Administration sponsors around 100 Women’s Business Centers around the country that aid in business development and provide businesswomen with capital either through direct grants and loans or directing them toward other government loans and grants.
2. Government business grants for rural areas
If you are setting up a business in a rural area, you could be eligible for government startup grants such as The USDA Rural Business Enterprise Grant Program.
Business government grants such as these are designed to fund projects that will benefit rural areas and residents. Smaller requests for these government small business grants are given priority, with the general range of requests ranging from $10,000 to $500,000. Funds from these government small businesses grants may be used for:
- Training and technical assistance, such as project planning, business counseling/training, market research, feasibility studies, professional/technical reports, or product/service improvements
- Acquisition or development of land, easements, or rights of way; construction, conversion, renovation of buildings, plants, machinery, equipment, access streets and roads, parking areas, utilities
- Pollution control and abatement
- Distance adult learning for job training and advancement
- Rural transportation improvement
- Community economic development
- Technology-based economic development
- Feasibility studies and business plans
- Leadership and entrepreneur training
- Rural business incubators
- Long-term business strategic planning
Applications for these government grants for business compete on a state level and are accepted by the USDA Rural Development’s local or state offices on an annual basis.
3. Small business government grants for minorities
Opportunities for government small business grants can be found through the Minority Business Development Agency, an agency of the U.S. Department of Commerce that supports minority-run small business through government grants.
Another good avenue for finding government loans and grants is through the National Minority Supplier Development Council, a group committed to increasing business opportunities for certified minority businesses.
The SBA 8(a) Business Development Program connects socially or economically disadvantaged small business owners with capital through small business government grants, including government grants for starting a business. To qualify for one of these government grants for businesses, 51% or more of the company must be owned by a person who has been subjected to a cultural bias or prejudice and put at an economic disadvantage due to their race or ethnicity.
For aspiring entrepreneurs in low-income neighborhoods, Operation HOPE Small-Business Empowerment Program is a program that can help provide government grants to start a business or grow it.
Beyond providing financial support through government grants for small businesses, the program also will provide you with resources for setting up a business plan, financial statements, credit counseling, and more.
SBA.gov: U.S. Small Business Association
The U.S. Small Business Association (SBA) has multiple resources for finding small business government grants and loans, as well as information on starting a business.
Image Source: SBA.gov
Government loans and grants search tool
SBA’s government grants for small business development can be found here on their website. Beyond the government grants SBA offers, they also provide helpful information about government business grants that you may be eligible for.
What SBA does NOT cover
Unfortunately, SBA does not offer government grants for starting a business. Government grants to start a business can be found through other state and local programs. However, SBA does have the power to make government grants to non-profit businesses and educational organizations.
The SBIR Program
The Small Business Innovation Research Program (SBIR) provides government loans and grants that support domestic small businesses in engaging in federal research and development.
Image Source: Small Business Innovation Research Program
This competitive program for government business grants was developed to foster scientific excellence and technological innovation for the good of the national economy. More information about the SBIR program can be found here on their website, including a list of participating agencies that back the government grants.
The STTR Program
Similarly to the SBIR program, The Small Business Technology Transfer Program (STTR) was created with a specific purpose in mind for the government grants for small businesses that it provides. Funding through government small business grants is provided for the expansion of the public/private sector partnership.
With the STTR program, business government grants are given to small businesses who will then collaborate with a research institution. For more information about the STTR program and the government business grants available through the program, check out this site.
For a further look into the multiple opportunities out there, Federal Grants.com provides a Grant Search tool that allows you to search for government grants for small businesses by keyword, government agency, or a specific grant category.
Image Source: Federal Grants.com
Using the information we’ve already covered about government grants for small businesses, you should have some idea about what type of government business grants you’re looking for.
Furthermore, Federal Grants.com has an entire section on its homepage that lets you research what state government grants are available to you. Some states don’t have government business grants, but may still offer financial incentives such as tax cuts depending on your situation.
If you’re looking for government startup grants, evaluate what type of service you’ll be providing, as most government grants for small businesses will help an already existing business but not the start of a new one.
This doesn’t mean you won’t find state-specific grants that fit your situation, however. Government grants to start a business can sometimes be found through state or local agencies, which you can research further on your state or governor’s official site.
Similarly, the type of business you have will affect which government grants and loans you will be eligible for. Non-profit companies and educational organizations usually have the best chance of getting government grants for starting a business.
Otherwise, your start-up may not be eligible for federal government startup grants. Nonetheless, there are many types of specific government grants for businesses that you may qualify for, depending on your background, target demographic, or geographical region.
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