Sourcing capital is one of the most pressing, frustrating challenges any small business owner has to face. Finding investors can be imposing, and qualifying for loans isn't always viable while you're still getting your feet set in your market. That kind of uncertainty can undermine your faith in your business and keep your operations grounded — regardless of how bold and actionable your ideas might be.
But if you believe you have the vision, mission, integrity, savvy, and work ethic to affect change through your company, you might want to explore the possibility of pursuing small business grants — capital infusions from organizations looking to empower smaller companies that have what it takes to help advance certain big-picture goals.
Here, we'll take a closer look at what small business grants are, go over how to apply for them, take a look at some tips for how to navigate the application process effectively, and see some resources to support your pursuit of this kind of funding.
What are small business grants?
A small business grant is essentially a mission-driven investment awarded to a small business — by a government, corporate, or nonprofit entity — that demonstrates the vision and ability to advance certain goals set by the grant-awarding organization. Unlike loans, small business grants don't need to be repaid.
Small business grants can come from a variety of sources — the federal government, state governments, certain private companies, and various nonprofits all offer this kind of funding to small businesses.
That eclectic mix of potential funders makes for an equally eclectic mix of application processes. There's no also no definitive, one-stop-shop resource where you can easily access information about every small business grant — but there are some resources that can aid that process.
Grants.gov provides a rolling, searchable database of grants listed by government agencies. GrantWatch.com offers a similar service that also includes some grants listed by private organizations as well.
How to Apply for Small Business Grants
As I touched on, there's no standard, one-size-fits-all mold for what the small business grant application looks like. Every grant is unique and, in most cases, will have an application process that reflects that. Still, certain elements tend to pop up on the majority of small business grant applications. These include:
Number of employees
Your elevator pitch
How you intend to use the grant money
Your social media information
How long you've been in business
A photo of you
A detailed business plan
Have those details — among others — in line if you want to reliably complete solid small business grant applications. Now, let's take a look at some strides you can take to maximize your chances of landing this kind of funding.
How to Get Grants for Small Businesses
1. Determine if it's worth your time and effort.
Pursuing small business grants is often a labor-intensive, time-consuming process with uncertain ends. There's no guarantee that the work you put into it will pay off. If you're interested in applying for small business grants, you need to know you have the time and resources to allocate toward the process — even if your efforts go nowhere.
The grant application process isn't always intuitive, so you'll likely have to conduct extensive research both before and throughout it. Also, thoroughly and thoughtfully filling out applications can be tricky and tedious in its own right, so be prepared to set aside a significant amount of time to do it.
If you're not ready or able to account for those burdens — and you think some extra capital is much more of a "nice-to-have" than a "need-to-have" — pursuing small business grants might not be in your best interest.
2. Conduct an exhaustive yet focused search.
Grants come in all shapes and sizes — so you won't be qualified for all of them. Some are industry-specific. Some are mission-driven. Others might be based on the revenue your business generates or any other factor that shapes your company's operations or identity.
Your search has to be exhaustive, but you don't want to cast too wide of a net. As I mentioned, the grant application process can be time-consuming and labor-intensive — and if you wind up applying indiscriminately, you'll waste valuable energy you could've put into growing your business on your own.
Find grants you can feasibly win — ones that your business's defining characteristics align with — and go from there. If you apply to every small business grant without thought or careful intention, you'll waste both your and the grants' judges' time.
3. Research the grants you're applying for, and understand what they want from you.
Once you have a picture of the grants you want to apply for, lock in on them, and learn what the bodies behind them are looking for. In most cases, an organization behind a small business grant is looking to support companies whose efforts align with its values, goals, or underlying mission.
So if you're applying for a small business grant, make sure you line up with its ideological and logistical specifications. Again, the Grants.gov search engine can help you pin down ones that you're well-equipped to compete for.
4. Put together a thorough, refined, well-constructed business plan.
One of the key components to virtually every successful grant application is a detailed, impressive, thoughtfully constructed business plan. Organizations that dole out small business grants want to know that the companies they award are going to use their grant money effectively.
Small business grants are rooted in two kinds of trust — trust in ideology and trust in viability. Your company might put together an application that demonstrates how you embody the values and mission behind a grant better than literally anyone else on Earth — but if you can't show that you have the business savvy, logistical capacity, leadership skills to advance those values, you're not going to win that funding.
Make sure your business plan clearly conveys how your business will benefit from a grant, how you'll leverage the funding that comes with it, and how those efforts will advance the goals the granting body is hoping to achieve.
5. Don't get too fixated on a single grant.
While you never want to cast too wide a net when applying for small business grants, you should also avoid selecting a single grant and exhausting all of your time and energy on it. Small business grants are extremely competitive, so if you want to maximize your chances of landing one, you need to strike a balance between appropriate quantity and high quality.
Try to find multiple grants that you have a legitimate shot at, and tailor your applications to suit all of them individually — that being said, you might see a fair amount of overlap in terms of what the organizations behind these grants want from you. So certain elements of one application might carry over to another.
Again, you want to avoid stretching yourself too thin, but if you only explore one option, you're not playing the odds effectively — and that could leave you exhausted, out of some valuable time and resources, and disappointed in the process.
6. Consider bringing in outside help.
If you don't think you have the time, energy, resources, skills, or know-how to make a compelling case on your small business grant applications, you might want to consider bringing in some outside help.
Accountants or other kinds of consultants can be valuable resources when putting your applications together. They can ensure that you're covering all the bases you need to while providing specific insight about how you can stand out and appropriately cater to the bodies behind the grants you're applying for.
Outsourcing some (or all) of your grant writing efforts can also save you considerable time and energy, and if you manage to win grants as a result of their help, their services will essentially pay for themselves.
The Small Business Innovation Research Program (SBIR) bills itself as "America's Seed Fund." Backed by the US Small Business Administration, the SBIR connects startups with agencies looking to help fund innovative research and development within specific areas.
For instance, a government agency might list a grant for "Chip-Scale Optical Receivers for Communications" to connect with businesses working on that kind of technology.
The US Economic Development Administration (EDA) provides federally funded grant opportunities to businesses across virtually every industry. The organization offers access to a rolling list of government programs small business owners can apply to potentially land grant money.
The $100,000 for Start a SUD Startup grant program is backed by the National Institute on Drug Abuse. The program will award 10 separate $10,000 prizes to biotech businesses researching substance use disorders.
IFund Women offers a series of grants to qualifying women-owned businesses with roughly $8 million in total funding to distribute. The program's grants come and go on a rolling basis, but it offers a universal application that female entrepreneurs can fill out to be entered into competitions for relevant grants as they open.
The SoGal Black Founder Startup Grant takes applications on a rolling basis, awarding individual grants of between $5,000 and $10,000 to qualified businesses.
An awardee must self-identify as a Black woman or Black nonbinary entrepreneur, have a legally registered business, plan to seek investor financing to scale, and have a scalable, high-impact solution or idea with the ambition to be the next billion-dollar business.
For more information on other funding resources for Black business owners, check out this article.
The US Chamber of Commerce Minority Business Development Agency (MBDA) conducts various grant competitions for minority-owned small businesses on a rolling basis throughout the year.
It provides the information necessary for business owners to locate grants, understand grant announcements, access pre-application materials, and understand evaluation processes.
Small business grants provide a viable (but hard-earned) opportunity for companies to sustain their operations and impact mission-driven social change. If you believe your business has the vision and viability — along with the necessary time and resources — to land this funding, you might want to explore applying for these grants.
Originally published Sep 23, 2021 7:00:00 AM, updated October 12 2021