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.

USA Small Business Grants – Eligibility and Application Procedures

The classification for the small scale business is done based on its capital, profit, manpower and productivity. Few of the business are commenced with self finance and mostly it is done with the funds borrowed. The government in many countries has started funding by wayto small scale business mainly to prevent the huge down payment as interest to the banks. The grant given for the business assists the owners or the proprietors to get the principle amount and there is no worry for them to repay the amount in future.

It has given to the small scale business also helps in developing the growth of the small companies as the source from where the financial support received is reliable and stable. Generally, for business is obtained from the local authorities, state government of the national government. Few industrial organizations and the corporations that are established well also give these kinds of grants, but are not desirable all the time.

The funding by way to small scale business is limited. Particular areas are targeted for this kind of funding. Principal amount is the main area where the capital investment is very less or not available. The small scale business grants are also provided for other business related works like husbandry, fishery and farming. It is also targeted towards manpower hiring, purchase of new equipments or machinery. If there is necessity of a building separately, then the small business grant will be intended for purchase of land and construction of the building. In the case of business that is established, the small business grants are provided for development and research and also for technology improvement. The small business grants are also given for enhancement of international trading to the foreign exports.

The business plan should be drafted well and to be submitted to get the small business grant. Generally, the loan contributor for these small business grants is the SBA called as the Small Business Administration. It is also important for the borrower to clearly mention the places where the grant money will be utilized as the expectation is that around 50% to 85% of the grant money should be invested for the business purpose. The grant is given based on this guarantee of investment in business. Once the grant is approved, analysis is done on the credit and concluding report has to be submitted to the lender. Then the amount will be disbursed directly to the owner of the business by the lender.

Small Business Grant Source:

Learn the application procedures, various funding sources for specific types of businesses and eligibility criteria for small business grants.

Government Small Business Grants

The government agencies offer various range of government grants. The government grants completely differ from the loans as the repayment is not required for the government grants and in the case of the loan, the amount has to be repaid with particular interest and time. Due to this reason, quite a large number of people would prefer to avail the government grants. But the grants are mainly given to the organizations that are with the non-profit motive and will also be beneficial to the public.

The terms and conditions are plenty for obtaining the grant. The qualification is depending on the intention and the requirement of the applicant and thus there is no guarantee that the grant will be approved even when the non profit organization applies for the grant.

Thus to avoid the stiff need of the grant programme, it is a must to engage the grant writers who are professional in this field. To quote an example, the local government can hire the writers who are proficient in grant writing for writing their proposals and also various related documents for getting the subsidies from the federal or the state government. Mostly these sectors look for grant for funding their public projects locally. The applications for the grant written and submitted in the correct manner will have a bright chance of getting the grant approved. It is also very unfortunate to quote as these grant writers are professionals and also possesses more knowledge about the grants, they take advantage of some of the provisions that will permit them to obtain various grants for the same project or for the same purpose.

Each year lot of grants is being given to various sectors in the society mainly for the public welfare. The government grants are also given for various reasons like cultivation, real estate, health, arts etc. that will affect the greater part of the population directly or indirectly. However, all the grants can be achieved only with the legitimate reason and the correct proposal. This is mainly because the government is not interested in wasting the money of the tax payers for nothing. Because of this reason, many applicants will find it very difficult for applying and thus getting the hold for the grant. Thus it will be quite simple for applying and get the grant approved for a loan through the small business administration.

Nowadays, various companies offer the grant writer’s service. The benefits are generally used for attracting the people for payment of the service fees and the likes with a guarantee that the application for the grant will be approved. The application for the grant cannot be made any time and there are certain time restrictions for submission of the grant proposal and the application. Applications received after the time limit will not be considered.

Small Business Grant Source:

Learn the application procedures, various funding sources for specific types of businesses and eligibility criteria for small business grants.

The Basics of Small Business Grants and How You Can Get One

Small business grants are a popular topic because they’re alluring. After all, a grant will give you money to start your own small business, and you will not have to pay it back. It’s sort of like getting a gift of money, or an inheritance.

There’s a lot of confusion and misinformation about small business grants though, and there are a lot of scams too. So let’s look at some of the basics…

  1. Small business grants are not usually given out by the federal government. State government groups and offices however, often do give out small business grants for specific purposes. Generally state government grants are given to help create jobs and boost the economy in the state.
  2. Small business grants are usually given for specific reasons. Not everyone can qualify for every grant available. Many grants are only available to specific minorities such as African Americans for instance, or women, or even African American Women. There are grants for Native American owned small businesses, grants for technology based businesses, and grants for innovative businesses too. And this is possibly the least understood aspect of small business grants. Many people mistakenly believe that anyone can get a grant, or multiple grants, just by applying. But you need to follow the application rules and guidelines. A small business owned solely by a man is not going to get a grant which is just available to women owned businesses.
  3. Grants are offered by a variety of organizations. Many grants are offered by private foundations for instance, while others may be offered by corporations.
  4. Small business grants take time. Most grants have a detailed, step-by-step application process that must be completed. And that application can take time to complete. A lot of time. Depending on the source of the small business grant, there may be other requirements that have to be met before they’ll even look at your application too. And once the application is accepted, it could be a year or more before the organization decides who will get the limited number of small business grants they have available.
  5. Small business grants are plentiful yet scarce. There are literally thousands of places to apply for small business grants, but each place usually has a very limited number of grants to give. It’s not uncommon for there to be only one grant available from a given organization each year, and in some cases there’s just one grant every five years or so.
  6. Small business grants may not help a start up. This is another common misconception about small business grants. Many people who are ready to start a business, think that getting a business grant is the best way to get started. The problem though, is that many small business grants will only be awarded to existing or established businesses.

Part of the grant application process will involve submitting a copy of your detailed business and marketing plans, submitting financial data to show your profits and profit margins.

And even when you do locate sources of small business grants that will accept applications from start up companies, you often need to have money available for hiring grant consultants and professional grant writers too.

So yes, getting a small business grant is quite possible, but be aware you will need to work very hard to get one, and it could take quite a bit of time too.