Small business grants can make starting a new business or growing an existing one easier. Unlike loans, which have to be repaid, grant money typically does not require business owners to pay it back.
Figuring out how to get a small business grant is the challenge. It can be complicated if you’ve never done it before, and the grant landscape can be competitive. Understanding more about what’s needed to qualify can help when you’re seeking out grant money for your small business.
Below are seven tips that may help you find and secure the small business grant that will work for you.
Key Points
• To get a small business grant, start by researching grants from government agencies, private organizations, and nonprofits that align with your business goals, industry, and location.
• Carefully review the eligibility requirements for each grant, ensuring your business meets the necessary qualifications, such as size, revenue, or target demographic.
• A solid business plan is often required, outlining your goals, strategies, and how the grant will help your business grow or achieve specific objectives.
• Write a clear, compelling grant proposal that directly addresses the objectives of the grant, explaining how your business aligns with the grant’s purpose and showcasing how the funds will be used effectively.
• In addition to small business grants, businesses can rely on small business loans to get the funding they need to grow or maintain their business.
1. Get Familiar With the Grant Options
One of the keys to getting a small business grant is simply knowing what’s available. Some grant programs that offer funding to any kind of business, whereas others may be more selective as to which types of business owners they support.
For example, when searching for grant opportunities, you may come across:
• Small business grants for minorities
• Business grants for disabled entrepreneurs
• Grants and loans for disabled veterans
• Grants for immigrant business owners
If your business fits into any of those categories, looking for relevant grants could help you find additional possibilities as you fine-tune your search for grant funding.
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2. Know Where to Look for Grants
Grant money for small businesses can seem elusive unless you know where to look. A general web search can turn up some results, but there are a number of websites that aggregate different kinds of small business grant opportunities in one place.
Some of the options you might consider include:
• Grants.gov: This government-run website houses information on more than 1,000 grants as well as additional resources for potential applicants.
• GrantWatch: This subscription-based website allows you to search for grants using different criteria and provides information about other resources, like grant writer referrals.
• Minority Business Development Agency (MBDA): This government-run website lists some grant competitions as well as providing other resources for small businesses.
• Small Business Administration (SBA): The SBA is involved with some grantmaking, particularly in the area of research and development, and also grants funds to community organizations.
• USDA Rural Business Development Grants: Rural Development provides grants (and loans) to encourage the development of housing, healthcare, first responder services, utilities, and other essential services.
You can also research how to get a small business grant at the local or state level. Your city’s Chamber of Commerce or state business development agency may be good starting points for finding grant opportunities.
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3. Review Individual Grant Criteria
When it comes down to applying for small business grant funding, researching the qualification criteria is critical. This can help you pinpoint the grant opportunities you’re most likely to qualify for, while weeding out ones that aren’t a good fit.
Every grant is different, and again, one of the main criteria for a specific grant might be whether you operate a woman-owned business, belong to a minority group, or have veteran status.
Beyond that, however, consider other minimum qualifications, such as:
• Time in business
• Type of industry
• Annual revenues
• Number of employees
• Planned use for grant funding
Some small business grants may be aimed at newer businesses, while others may be geared toward helping established businesses grow. Still, others may place conditions on how grant money can be used to further business activities. These are all things you should know before putting the time and effort into completing the application.
Recommended: Guide to Grant Writing for Small Businesses
4. Know What Registrations You May Need to Apply
Depending on the grant program, you might need some registrations before you can apply. For example, you may be required to have any or all of the following:
• Federal Employer Identification Number (EIN)
• DUNS Number
• SBA certified small business or woman-owned business documentation
• Business license or articles of incorporation
If you’re applying for grants through a portal like Grants.gov, you may also need to register for an account with the site first. Making sure you have all the necessary registrations in place before you apply can save you time later.
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5. Update Your Business Plan
It’s typical for lenders to ask to see a copy of your business plan when you’re applying for loans. For SBA loans, for example, a business plan is a requirement when you want to be considered for funding.
It’s not uncommon to need an updated business plan when you’re trying to get grant money for your small business. If you haven’t updated your business plan recently, or if you’ve never drafted one, that’s one more thing to cross off the list before you apply for funding.
A business plan should contain certain details about how you run your business. The basic format typically includes:
• An executive summary
• Company description
• Market analysis
• A description of your organization and management
• Details about your products or services
• Financial projections and expected growth
Remember that getting a business grant can hinge on how you present your business. Your business plan, along with the details you include in your application, are your chance to make a strong case for why you should receive funding.
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6. Complete the Grant Application
Perhaps the most important step in how to get a small business grant is filling out the application. This part of the process can take days or even weeks, depending on how extensive the application is and what the grant-making organization requires in the way of supporting documentation.
Here are some tips to keep in mind as you fill out the application:
Know your due dates
Grant applications often have deadlines and you don’t want to miss out on a chance to secure funding. Make note of when the application is due and give yourself plenty of time to complete it.
Read it through at least once
Give the application a thorough review so you know what’s covered and what you’ll need to provide when you’re ready to submit it.
Be truthful
Avoid including inaccurate or misleading information on your application, since that could cause you to be disqualified for grant funds.
• Be thorough. One thing to note about how to apply for small business grant money is that less is not more. In other words, if the application asks for a detailed description of how you plan to use the money, then don’t offer up a one- or two-sentence explanation.
• Don’t leave anything out. If a grant application asks for specific documentation, such as a copy of your business plan or a recent profit and loss statement, don’t fail to include it. An incomplete application could be rejected right off the bat, so make sure you’re submitting all requested documents.
Before you hand in your grant application, proofread it for spelling or grammar errors and correct any you find. You may also want to have someone who’s experienced with small business grants or grants in general look it over, as well. You could also consider hiring a grant writer to review your application. A second set of eyes may discover overlooked mistakes or areas you could improve.
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7. Follow Up if Appropriate
Once you’ve sent in your grant application, the waiting game begins. The application review and approval process can take weeks or even months, depending on the grant.
During this time, you may want to reach out to the grant organization and check up on the application. Specifically, you could ask if there’s any additional information or clarification needed as your application is being reviewed.
You don’t want to be a nuisance, but following up could help with getting you a small business grant if it keeps you on the grant-maker’s radar.
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The Takeaway
Grant money for small businesses can be a financial lifeline if you’re hoping to launch a new venture or grow a business you already have. Working out the details of how to get a business grant can help you find the best grant options and deliver the strongest application possible.
In the meantime, don’t discount small business loans as an alternative source of funding.
If you’re seeking financing for your business, SoFi is here to support you. On SoFi’s marketplace, you can shop and compare financing options for your business in minutes.
FAQ
What are the eligibility requirements for small business grants?
Eligibility for small business grants typically depends on factors like the size of the business, location, industry, and the purpose of the grant. Many grants also require that the business meets specific criteria, such as being independently owned or serving a particular community or demographic group.
How do I find small business grants?
You can find small business grants through government websites like Grants.gov, local chamber of commerce listings, and nonprofit organizations. Additionally, private corporations and foundations often offer industry-specific or competition-based grants to support business innovation or community development.
What is the application process for small business grants?
The application process generally involves filling out a detailed proposal or application form, providing financial documents, and outlining how the grant will be used to support business growth or specific projects. It’s important to follow the grant guidelines carefully and submit all required documentation to increase your chances of approval.
Photo credit: iStock/sakkmesterke
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