If you’re a small business owner, you know that funding your business can be one of the most challenging hurdles to overcome, particularly in this time of high inflation.
Small business loans can also come with stringent requirements and high interest rates, and investors might ask for more stake in your business than you’re prepared to part with.
That’s why grants for small businesses are a particularly valuable source of funding.
“You don’t need to pay the money back, and the entity who awards the business dollars does not own any portion of the small business,” Patrina Dixon, founder and CEO of It’$ My Money, said in an email.
Read on to learn more about where to find a grant for your business.
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Why Apply for a Small Business Grant?
Small business grants are a particularly valuable source of funding because unlike a loan, you don’t have to pay that money back. And while it might seem like finding an eligible grant and going through the application process is difficult, there are options available for all kinds of businesses, Dixon said.
“The entity that is making the grant dollars available provides information on the type of businesses who would be eligible for the grant dollars. The eligibility ranges from which state in the U.S. your business is in to if you’re for profit or nonprofit to the type of business it is, like retail or service-based, to name a few,” she said.
[READ: How to Start a Small Business.]
Small Business Grants to Consider
There are several different sources of small business grants, including the federal government and state governments, private corporations and individuals.
“A top tip for small businesses seeking funding is to thoroughly research and target grants specifically designed for their industry sector, business size and development stage to increase their chance of success,” Andy Chang, founder and CEO of The Credit Review, said in an email.
Where you’ll start your research depends on whether it’s a federal, state or private grant. Additionally, different grants exist for startup funding and emergency funding.
Here are some grants to consider:
Federal Government Grants
Federal government grants are perhaps the easiest to look for because you can search directly on the U.S. Small Business Administration and Grant.Gov websites.
Popular federal grants include:
— Small Business Innovation Research (SBIR)
— Small Business Technology Transfer (STTR)
— U.S. Department of Agriculture Grants (USDA)
— U.S. Economic Development Administration Grants (EDA)
SBIR and STTR grants, for instance, are designed for small businesses in innovative research and development.
“They offer funding for crucial proof of concept, prototype and commercialization phases,” Chang said.
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State Government Grants
“State grants often have local economy and business development as a key objective,” Chang said.
“For Texas, we have the Texas Enterprise Fund and the Skills Development Fund as two standouts,” he added.
Grants.gov allows you to search state government grants in addition to federal ones.
Private Grants
Private grants are issued by individuals or companies, and are often available to more targeted groups, like Black entrepreneurs or veteran business owners.
While there is no centralized database for all available private grants, there are many websites and newsletters designed to aggregate opportunities and identify to whom they’re available, including one curated by Dixon.
Some private grants to consider include:
— Verizon Small Business Grant
Tips For Your Grant Application
The first step in your research is to identify your qualifications. Rather than cast a wide net, you’ll want to target grants tailored to your particular business.
“Pitch only to grants that match your business well, and be prepared to sell your business via a well-thought-out proposal covering exactly how you’ll use the grant money,” Jake Hill, CEO of DebtHammer, said in an email.
Dixon said to pay careful addition to deadlines and required documentation. Grants receive many applications, so if yours is not thorough, you could be dismissed early in the application process. Follow specific instructions to the letter.
“If a video is a part of the application, and they give you specifics for the video, also try to get in your name, the name of your business, who your business provides services for and what you plan to do with the dollars. Also, if there is a certain duration requested, like 60 seconds, do not exceed the time,” Dixon said.
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These Organizations Will Give You a Grant for Your Small Business originally appeared on usnews.com
Update 01/24/24: This story was previously published at an earlier date and has been updated with new information.
