Business grants are an often overlooked strategy for securing funding for certain types of startups ranging from idea stage, mid-stage, and even later stage. Overall the outlook for startup funding in 2020 is bright for both new and established companies. There are plenty of federal grants and corporate grants available in the US this year to provide startup funding that will help small businesses to succeed and flourish.
While the idea of owning a company is always exciting, it is easier said than done. It will require money to turn brilliant ideas into actual operations. Not all entrepreneurs have the seed money to make this happen, and this is where small business grants come in handy.
Business grants in the US are not handouts by any stretch of the imagination. This startup money is provided freely for a specific purpose aligned to strategic national, state or regional priorities, such as education, workforce development, technology development and more. This is why when applying for a business grant; it is essential to present how unique your business is, justify how this startup funding is aligned to the funder’s priorities and demonstrate what you will be able to achieve with the requested funding.
US Government & Federal Business Grants
US government-backed business grants are by different types of agencies. Federal grants are those that are typically available to businesses based in any US state or territory. An example is the Small Business Innovation Research (SBIR) Program, which helps entrepreneurs that use innovation and technology with immense potential for commercialization. Participating in this fund are agencies that seek to help businesses research, develop, and commercial new technologies. Among these are agencies such as NASA, the Department of Homeland Security, the Environmental Protection Agency, and the National Science Foundation, among others.
Other available Federal business grants available in 2020 include the Small Business Technology Transfer (STTR) Program and grants from agencies such as the Department of Defense, Department of Energy, the National Institutes of Health, and others.
Corporate grants are those that are offered by established businesses. Examples of private grants you can apply for in 2020 are the FedEx Small Business Grant Contest, the National Association for the Self-Employed (NASE) Growth Grants, and the StreetShares Foundation Veteran Business Grant.
A growing number of states are also offering business grants to support existing businesses and to encourage new businesses to locate or relocate to the states offering the funding. Some states also offer business grants to businesses that are located in other states but want to establish some sort of operations (e.g., a pilot project, etc.) in another state. Unfortunately, searching for these state business grants is a tedious and time-consuming operation.
Unlike the Federal government, which has a searchable, centralized database (Grants.gov) of all available business grants, no such database exists at state business grants. That being the case, I decided to create my own database that aggregates business grants offered in all 50 states and most US territories. I use this proprietary database to allow me to offer a unique, value-adding service to my business clients.
Class or Community-Based Grants
There are also class or community-based grants that are typically provided by institutions or trusts. Grants for women support business entities that advocate gender equality. Grants for Veterans are specialized startup funding opportunities offered to retired uniformed service members. Grants for minorities, on the other hand, are those that help boost the chances of marginalized members of society.
The advantage of small business grants is that this type of startup funding does not dilute owner equity. It’s also important to note that this type of funding is not right for all types of startups or businesses. As I mentioned, they are only offered to startups or businesses that are aligned to key national, state or regional strategic priorities.
And remember that finding, applying for, winning, and managing business grants of any kind is both tedious and time-consuming.
Here are a few grant tips that can help you:
- Be certain that your business or project idea is fully aligned to the funding program priorities. Otherwise, your funding proposal will be ignored.
- Always answer all the questions or provide all the requested information. Never leave any sections blank.
- Never take a ‘shotgun’ approach and just throw as many funding proposals as possible in the hope of getting a win. I have secured more than $400 million for clients and not once have I seen this approach work.
Interested in learning more about business grants or applying for a business grant? Contact me today and let’s talk!