Federal Small Business Grants – How to Get One For Your Business

One of the most common questions that an entrepreneur has is where to get a grant so as to finance their business. As with any other business, starting a small business requires not only a business model and a market for the product but also capital to finance the business.

However with recession taking its toll it has become difficult for small businesses to entice private investors or acquire loans to start their business.

The solution to this problem may lie in federal grants which are available by the Government throughout America. These grants are paid to entrepreneurs who wish to start their own business and meet a certain criteria.

This “seed” money is not a loan and does not have to be repaid by the government. There are several types of small business grants that are available by the federal government such as grants for women entrepreneurs, minority business owners or people wanting to set up business in underdeveloped areas.

Grant applications usually have a deadline period and this it is essential to start the application process as early as possible to avoid the possibility of rejections. The decision for approval of the grant can take somewhere between six to seven months after the entire application process.

There are three government resources from where you can derive information about these grants. The Small Business Innovation Research center, the SBA and the US government’s grants portal known as Grants.gov.

It is important to keep in mind that the federal grants provided by government is not a loan nor is it free money doled out by the government. An entrepreneur needs to show why he/she needs a loan and whether it satisfies some social cause like providing unemployment in economically backward areas.

The stronger and more detailed the presentation with hypothetical budgetary allotments the better is the chance of the grant being approved. Once the federal small business grant is approved it then becomes a contract between the government and the small business owner.

It is the responsibility of the entrepreneur to satisfy the conditions of the grant where time limits may be setting up for the business. Moreover the government may regularly send agents for audits and approvals.