Key takeaways
- Research is the most essential step when finding grants for small businesses.
- You need to tailor your application, business narrative, and proposal to each grant for which you apply.
- Double-check eligibility criteria and requirements before sending in your application to ensure you didn’t miss anything important.
- A detailed business plan with solid market research and relevant financial documents will increase your likelihood of receiving a grant.
- Assess your financial needs to ensure you apply for a grant that will cover your essential costs at the very least.
- Networking and engaging with like-minded peers and other entrepreneurs can improve access to new grant opportunities.
- Your credit score is directly related to your chances of obtaining a grant, so you need to work on improving your credit score.
Securing funding is one of the most important tasks entrepreneurs must attend to. Without sufficient financing, launching, running, or scaling a business is next to impossible. While there are several ways to secure funding for your entrepreneurial ventures, each comes with its restrictions, conditions, and criteria you must meet. So, what strategies can you adopt to secure grants for small businesses?
This guide provides an in-depth guide on securing business grants. Here you will find everything you need to know from organizations offering grants for startups, grants for young entrepreneurs, and more, as well as the steps you can take to reduce the chances of rejection.
What can you do to secure grants for small businesses?
Entrepreneurial activity is at an all-time high in the United States. According to the latest report by the Global Entrepreneur Monitor, Total Entrepreneurial Activity in the US reached 19% in 2024, a record high for the country. Job scarcity is among the top reasons that entrepreneurs cite for starting their own business. Moreover, widespread availability of different sources of funding for self-employed individuals is also a major contributor to increasing entrepreneurial activity.
Related: What is the job outlook for entrepreneurs in the US?
One major source of business funding is business grants for small businesses. These include free grants to start a business, or grants for specific business types, such as construction business grants. Whether you are looking for free grant money for business or grants to help start up your LLC, here are some strategies that can increase your chances of getting a business grant.
Do your research!
You can secure start-up business grants through various sources from government agencies, industry groups, specific grant-providing agencies, and more. One of the most renowned grant-providing agencies is the United States Small Business Administration, which provides up to a 10k start-up grant. However, the SBA has multiple investment programs offering startup business grants to qualifying businesses.
Through in-depth research, you can find investment programs for which your business qualifies. But since you should never put all your eggs in one basket, it is important to remember that you should apply for funding from multiple sources. All of which you can find only through research.
Create an impactful pitch
The next step is to create an engaging and impactful pitch. While creativity is important, what is also important is to know what the organization you are pitching to wants to hear. Contrary to popular belief, they aren’t just looking for impressive numbers, they are looking for innovation, preparedness, potential, and most importantly, a vision. That is not to say that you will not need to provide financial statements and other legal documentation; it means that the decision is not just dependent on metrics alone.
Make sure to add a personal touch and your vision and mission in your narrative alongside the required documentation. How to write a business plan is one of the main learning outcomes of entrepreneurial programs. You will find the requirements through research, and now you need to tailor the content as per each organization’s requirements. One generic pitch and narrative isn’t going to help your case. It can be the reason why your application gets rejected.
Attention to detail matters
Many entrepreneurs rush through the application process in a hurry to meet deadlines or in an attempt to get through the process as fast as possible. While meeting deadlines is essential, a proposal that lacks key information is not going to help your case. Whether you are looking for grants for small business startups to grow your enterprise or new business grants to launch your entrepreneurial venture, attention to detail is essential, which is why you must tailor your application for each organization.
Related: What does an entrepreneurship career look like?
Tailored proposals show dedication and attention to detail, and attention to detail matters tremendously. Moreover, they provide each grant-providing agency with the information they are looking for and need. Keep in mind that these organizations receive a ton of applications, and finance is a scarce resource. Thus, you need to make sure you not only provide what they want, but also go the extra mile and add what else will help your case, such as obtained legal licenses, if any, marketing statistics, financial statements, and so on.
Network and building connections
To many, this may prove to be the hardest part of the entire process. But when you know the right people, finding opportunities and accessing resources does become easier. If you join entrepreneurial circles, you not only learn about the latest developments in the field, but also agencies and organizations offering start-up business grants, and other funding sources. Those enrolled in an entrepreneurship degree can easily access networking opportunities, while others may have to struggle.
You might also be able to get insights from an entrepreneur who was able to secure grant money for their business. Moreover, you might even be able to get insights into the legalities of obtaining and using grant money for business. So make sure to network with mentors, join grant applications, and actively engage with other entrepreneurs through forums and online platforms.
Check the eligibility criteria for each grant
Different grant-providing agencies have different grant-providing criteria. While some organizations award grants for construction companies only, others offer grant sites for businesses or grant money for businesses. Regardless of what kind of business you are running, you will find a relevant organization to seek a grant from. However, you must look into the eligibility criteria and requirements list before you start your application.
For example, the Small Business Innovation Research Program by the SBA honors innovation in entrepreneurship. Through the program, you can receive a grant for your innovative idea as long as it revolves around federal research and development.
Similarly, the Small Business Technology Transfer Program is ideal for those engaged in federal research and development in the field of technology. The initial stages of the grant approval process require entrepreneurs to work with approved non-profit organizations and agencies during the incubation stage.
How to get grant money for the business?
Securing grants for small businesses requires a lot of legwork, both physically and metaphorically. You not only need a lot of research, but also a game plan. Here, we provide both to make the process easier for you.
Determine how much money do you need
First and foremost, you need to know the amount you need. The calculations for that aren’t as straightforward as you may think. You will not only need to account for the money you need shortly, but also calculate the total expenses you may incur in at least the next five years, Moreover, you will need to project sales and income for the given period as well and then calculate the additional amount of money you will need.
Here are some important costs to keep in mind:
- Fixed costs such as rent, utilities, cost of production, and so on.
- Salaries of all employees
- Your salary
Related: Find high-paying entrepreneur jobs in the US
Find funding sources
There are several funding sources that you can turn to to secure either a small grant, such as the $10k startup grant, or a higher amount to grow and scale your business. There are several types of grants that you can obtain through federal, state, local, or private grant-providing agencies. Before we answer how to obtain a grant for a business, here is a list of organizations from which you can receive loans or free grant money for small businesses. And we say free because you don’t need to receive grants.
- Farmers Market Promotion Program
- Small Business Innovation Research Program
- Small Business Technology Transfer Program
- Small Business Investment Company
- Business Warrior – offers startup capital at low interest rates
- GoFundMe Small Business Relief Fund – $500 grants to those affected by the pandemic and able to raise the same amount through a GoFundMe account.
- Dream Big Awards – hosted by the US Chamber of Commerce, offering a $25,000 grand prize to one qualifying small business.
Moreover, entrepreneurs from a diverse ethnic background who are wondering how to get a business grant can also apply for the following grants:
- US Department of Commerce Minority Business Development Agency
- Amazon’s Black Business Accelerator Program
- Amber Grant Foundation – Awards up to $10k in grants to female entrepreneurs
- Black Founder Startup Grant – get up to a $10k business grant if you qualify
Check eligibility requirements
Not everyone qualifies for all available grant types. You will need to check the eligibility criteria for each grant and also the maximum grant money that you can receive to see if it is enough for your business. Of course, you can apply for multiple grants and hope for the best. However, do not apply for those you do not qualify for. For example, as a male, applying for the Amber Grant Award is a fruitless pursuit. Similarly, a white person applying for the Black Founder Startup Grant is essentially a waste of time.
Write a business plan
Next, you need to come up with a well-written and detailed business plan. In the plan, you need to include in-depth market research, identify product demand, determine how much sales you can expect to make, and include every little detail, such as production, marketing, sales, dissemination channels, and more. However, the plan is not just about the technicalities of your business operations, it should also include your vision and your mission. Moreover, it should show your unique approach and how it enhances your chances of profitability.
Check, build, and improve your credit score
Even if you are applying for a free small business grant, know that they will look into your credit records to determine your eligibility. Your credit score is incredibly important when it comes to grant applications. If you are wondering how to apply for small business grants, you also need to wonder about your credit score and how you can improve it if needed. If you don’t have a formal education in finance, consider getting help from a professional.
Prepare all required documents
From financial statements to company mission and vision statements, market research, legal documents, licenses, and more, be prepared to submit them all. If some of the legalities and documentation are taking a little longer than expected, and you are dreading that you will miss the deadline, you need to double-check the required documents before you decide whether to apply.
If you are still waiting on some optional supplementary material, you can submit your application and provide the rest of the material if they ask for it. But if you are missing key documents, we suggest waiting until you have the material at hand, as your application will be rejected, and you will have to apply in the next cohort.
Be diligent in your pursuit
If you are truly passionate about starting your business venture, you need to be persistent in your efforts. Don’t give up after one rejection. Assess the reasons why your application was rejected and try again, making sure you get all the documentation right this time. After all, diligence and perseverance are the two qualities all entrepreneurs must have.
How to get a grant list for small businesses?
Different websites, online discussion forums, and government agencies publish lists of available grants. To access these resources, you can either conduct manual research or sign up for the newsletter or notifications from the following sites:
- Grants.gov
- U.S. Chamber of Commerce
- Small Business Administration
- Business Magazines
Bring your dreams to life with grants for small businesses!
Millions of talented individuals with big dreams of owning their own business one day are simply surviving in the job market because they don’t know how to receive a business grant. The number one source of funding for the self-employed is always self-financing. But not everyone is financially stable enough to finance their entrepreneurial vision. That’s where grants come in.
Federal, state, local, private, and not-for-profit grant-providing agencies offer different types of grants to deserving candidates. Whether you are looking for grants for new construction businesses, micro bakeries, or for your Amazon sales setup, there are several places you can get a grant from. And with our guide on how to receive grants for small businesses and strategies to increase acceptance rates, getting funding for your startup becomes easier.