The overwhelming majority of grants awarded directly to small businesses are for the purpose of carrying out specific research projects. But government grants support other activities as well. Other than not offering grants to start-up a new business, pay for general operating expenses or pay down debt, local, state and Federal grants support an incredible variety of projects that are initiated by or directly benefit small businesses. Examples of types of projects eligible for grant funding are shown below:
- Research and development (R&D) – this is where the Federal government directs the majority of grant funds available to small businesses. In particular, the Federal government funds R&D projects that are aligned to interests and priorities of the funding agency. These funding programs are ideal for small businesses interesting in researching and developing technologies, approaches or strategies;
- Direct services – these grant funds support projects that provide services directly to the target population (e.g., healthcare services, education or training, etc.). These funds are a good choice for businesses that provide services to organizations, agencies, governments and specific populations;
- Pilot or demonstration projects – some funding agencies are interested in supporting pilot projects that demonstrate new or innovative approaches to solving problems. Small businesses that want to further develop novel ideas often find these funding programs to be a match for the activities for which they are seeking grant funds;
- Technology development or commercialization projects – the Federal government invests a significant amount of money supporting the development or commercialization of innovative technologies. These technologies can be related to a broad range of topics including healthcare delivery, education, distance learning, electronic medical records (EMR), energy conservation, development of renewable energy sources, law enforcement or public safety, homeland security, and others. These funding programs are ideally suited to small businesses that have developed new technologies;
- Capacity building – some funding programs support activities that build the capacity of governmental agencies, schools or universities, healthcare organizations, law enforcement or public safety agencies or community-based organizations. Funding programs that support capacity-building activities are good choices for service providers and consultants.