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Grants for Small Business: Frequently Asked Questions
This article answers frequently asked questions (FAQs) about using grants to fund your small business.
What is a Small Business Grant?
A grant is money awarded to a grantee (person receiving a grant) to carry out the specific project or venture they planned to carry out in the grant proposal.
What is a Grant Proposal?
A grant proposal is a document that provides the potential grantor of funds with pertinent information regarding the business or venture. It includes highly detailed goals and objectives as well as timelines and methods for achieving them. It also includes financial projections as well to show when the business plans to break even and become self sustaining.
Are grants easy to obtain?
No! Anytime anyone gives anyone money without expecting repayment, it is not going to be easy. Grant proposals are highly detailed documents that require you to plan for many segments of your business including personnel, operations, and financial segments. However, if you are passionate about your idea, you will most likely not be dissuaded by this hurdle. Detailed documentation and planning may even help you think your business through.
Where can I find grants?
There are many resources for finding grants for your business. First check what industry your business falls under using the grants.gov website. Then check what grants are available at CFDA.gov. There are 26 federal agencies that have grants for small businesses. State and local governments also list grants for small businesses if they have any available. There are also many nongovernmental philanthropic and non-profit organizations with grants, but they are unlikely to fund a for-profit business.
What is the size of government grants?
This will depend on the specific grant. For a small business that needs a minute amount of money to continue, it can be a couple of hundred dollars. For scientific research to find a cure for a disease, it can be millions of dollars. A better question is: how much do I really need for my business? Ask yourself this and then see if there is a grant out there that is adequate for your venture.
Do government grants have to be repaid?
Grants by definition do not have to be repaid, but because of this fact, grants are difficult to obtain and the grantor of the funds will continue to make sure that you comply with the requirements set forth in the grant.
How long does it take to get money from government grants?
A date will most likely be arranged for transfer of funds upon approval of the grant. However, the approval process can take anywhere from a few months to a year.
Can I obtain multiple government grants?
Sure, as long as you qualify, you can apply for them. However, continue to be honest and notify the grantor about past grants you have received.
How do I apply for government grants?
There are usually five main steps to applying for government grants. They are as follows:
What Kinds of Businesses are eligible for Grants?
There are certain types of businesses that the government will just not give a grant to. For a business to be eligible it must perform a service for society or the community as simple as providing jobs to an underserved community or as complex as curing diseases.
Aren't grants only available for women, minorities, and the disabled?
This simply isn't true. Grants are for businesses that qualify. Some government agencies have contracts that they prefer to give to underserved groups, but no grants are set aside for specific groups.
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Growthink’s Step-By-Step Guide to Raising Capital from Grants
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Here is a sample of what you will learn in the report: