Who Qualifies For A Startup Small Business Grant
In general, government startup small business grants arent available for starting a business, paying off debt, or covering operational expenses. And unless your business is a nonprofit or is launching a project related to areas such as technology, medical research, or education, government grants may be hard to find. That being said, there are startup small business grants available for specific business types and owners, including:
Small Business Startup Grants
A range of startup business grants are available depending on the sector you want to go into. For example:
The National Lottery Heritage Fund supports heritage projects ranging from designed landscapes to cultural traditions. The National Lottery Grants for Heritage 2021-22 will prioritise projects that boost the local economy, encourage skills development and job creation, and support wellbeing. Learn about the National Lottery business grant.
Innovate UK provides government grants to develop and realise the potential of new ideas, including those from the UKs world-class research base. Read about the Innovate UK grant.
Research and Development tax reliefs support companies seeking to research or develop an advancement in their field . Find out about this type of business grant.
Plus, you can ask your local authority about grants available in your region and funding specific to your industry. Local authorities have also been administering government small business grants as part of the coronavirus support package, including the Local Restrictions Support Grants.
The governments business finance finder and regional funding portals are a good place to start your search for this type of business grant.
Dos And Donts Of Winning Business Grants
Lets start with some basic dos and donts of trying to win grants.
- Make a schedule Many grants are only open to applications once a year. Schedule time to put together an application ahead of time.
- Write a business plan first Most grants ask for a business plan. More importantly, you should know how exactly the grant money will help your business. Heres our guide to writing a simple business plan.
- See what companies have been funded in the past This can help you determine which grants you have a good chance of winning. If they funded similar types of businesses, thats a good sign.
- Get help from local business organizations I went through many types of local business organizations that provide assistance to small business owners. This includes helping you find grant opportunities and presenting your business in the best light.
- Consider professional help If you come across a grant that requires a well-written cover letter or essay, consider hiring a professional freelance grant writer if you can afford it.
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What To Know Before You Apply
The grant application process can take some time, however, some things can help speed the process up. One of these is having a single document listing all of the common questions you might get on a grant application. Writing these answers out ahead of time can make applying for grants much easier because you can copy and paste your answers into the application. Include the following in your document:
- Your capital plan. Whether youre a startup or an established company, what other methods will you use to fund your business? Options include crowdfunding, angel rounds, loans, seed rounds, et al.
- Business model. What type of business are you? Examples include e-commerce, subscription model, SaaS and membership.
- Revenue streams. Make a spreadsheet of your products, the cost of goods sold, retail price, the number you must sell to break even and your gross margin.
- Business pitch. This is your 15-second elevator pitch. Consider the problems your company solves, who your audience is and how you will use the proceeds of your grant. Another critical component of your answer is how you, the business owner, are uniquely qualified to solve this problem for your customer.
- Your small business brand. Include your social media accounts, logo and a video about your company. Your social media accounts should reflect your small businesss desired aesthetic.
- Target audience. Who does your small business sell to? What does an ideal client look like?
Good For: Technology Companies
The federal research SBIR grant program is for entrepreneurs focused on innovations in technology that have the potential for commercialization. You can check its funding opportunities here. Focus areas from the past include clean and safe water, homeland security, land revitalization, green construction, advancement of health care, and more.
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Why Are Government Grants For Small Businesses So Important In 2022 And Beyond
Government grants for small businesses are particularly important for developing a countrys micro, small and medium enterprises sector. Because these grants are funded by tax dollars, they have more restrictions than grants offered by private entities like FedEx and Cartier, as well as foundation grants like WomensNets Amber Grant.
Chief amongst these restrictions is an emphasis on how the money will be used to help the business make a meaningful impact in the community. Grants from the federal government were created to encourage businesses to be community builders and contribute to economic growth. A business that focuses on community development and innovation is sustainable and respected. This is the primary reason government grants for small businesses will remain relevant in 2022 and beyond.
Furthermore, many grant opportunities tend to reward innovation and scientific research. More grants tend to be offered in these categories because they give the country a competitive advantage. After all, it pays to stay ahead of the game.
Find more information on How to Start a Business here.
Minority Business Development Agency
The Minority Business Development Agency helps grow minority business enterprises through its programs, services, and funding.
- Award amount: Up to $350,000 initial grant
- How to apply: Visit the website for more information.
The MBDA offers business centers across the nation that offer high quality, technical assistance to minority business enterprises,” according to its site. Entrepreneurs can receive mentoring, counseling, and assistance with funding and growth.
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Fedex Small Business Grant
FedEx hosts a small business grant contest to provide funding for ambitious entrepreneurs. The contest has tough competition, with nearly 18,000 applicants for the tenth annual grant in 2022.
- Award amount: $15,000$50,000
- How to apply: Visit the FedEx website for specific application details.
This grant is open to small business models with a story worth telling, so if you plan to apply, pinpoint what makes your business unique.
Natural Resource Sales Assistance Program
The federal government sells large quantities of natural resources and surplus properties, in addition to the billions spent on goods and services. Small businesses can bid on a portion of these goods through the SBA Natural Resource Sales Assistance Program. Federal agencies may also divide surplus materials into smaller pieces, making it easier to buy for small businesses. These are the five categories:
- Timber and related forest products
- Strategic materials
- Leases that include rights to minerals, oil, and gas
- Surplus personal and real property
The program also offers training for small businesses in government sales and leasing.
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Protecting And Repairing Your Credit
The Federal Trade Commission website offers advice on how to protect yourself from scams and what to do next if you a victim of fraud or identity theft.
On the FTC website, you can also:
- File a consumer complaint
- Register for the Do Not Call List
- Receive scam alerts
In some cases, you can be reimbursed for being scammed by a business by registering your complaint with the FTC.
What Is A Llc
A Limited Liability Company is just that it protects you, as the business owner, from being held personally liable for the actions of your business . If there is a lawsuit against your business , the LLC protects you from the personal risks. This means that your personal assets stay safe. Additionally, LLCs have other benefits.
- LLCs offer pass-through taxation, meaning that taxes are not paid at the business level. When you create an LLC, income and losses are reported to the IRS on your personal tax return. When taxes are due, they are paid on the individual level.
- LLCs provide flexible management structures, allowing you to take control of daily operations and long-term growth strategies. Corporations have a predetermined management structure where directors supervise the essential business decisions, while officers take on running daily functions of the business.
- LLCs face fewer compliance requirements than corporations, as well as fewer state-imposed annual requirements and ongoing formalities.
With all of the great benefits of an LLC, there are still some disadvantages to explore, as well.
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Business Grants For Women
On top of all the grants weve looked at so far, there are several grants and resources specifically for small women-owned businesses.
I encourage you to visit your local Womens Business Centers if possible there are over 100 across the United States. They will be able to point you towards additional grant options or help you find alternative funding methods.
To become eligible, you first need to win a local InnovateHer challenge to qualify for the national competition.
Any type of business is eligible to compete, but those geared towards women and their social problems typically do best.
Us Economic Development Administration
The EDA is mandated to foster economic development in all US communities. Grant money is part of the solution and can be viewed on the EDA website, which is constantly being updated to reflect recent funding opportunities. For example, the most recent funding opportunity listed is the Fiscal Year 2020 Public Works and Economic Adjustment Assistance Programs. This grant provides $587 million in funding opportunities for small businesses affected by natural disasters in 2018. Clicking the link redirects you to the Grants.gov website, where you can view details about the grant.
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How To Raise Money For Your Business
Explore the different options and methods you can raise money for your business.
Please note that this article is intended for educational purposes only and should not be deemed to be or used as legal, employment, or health & safety advice. For guidance or advice specific to your business, consult with a qualified professional.
There are many reasons why a business may need to raise money. You could be an ambitious entrepreneur, looking for ways to raise startup capital and make your vision a reality. Perhaps your business is seasonal, and you need additional finance to supplement your income during a lull in custom. Or maybe youre looking for some funding for capital expendituresthat wont endanger your cash flow.
Lets take a look at some of the ways you can raise money for your business.
How Do I Get Started
Yes, there is grant money available from private foundations and government entities. No, it is generally not available to individuals to start for-profit businesses. There are a few private sector competitions listed below.
The first step you can take is to talk with an SBDC Business Advisor. Starting a small business in Alabama, or taking steps to save or grow it, is a lot easier after youve talked with a small business expert.
Even though many publications and talk shows publicize grants to small businesses, there are only certain types of government grants available to small businesses. SBA, for instance, offers Small Business Innovation Research and Small Business Technology Transfer grants. Grants from other agencies may also be available for new technologies, inventions, or products. The U.S. government does not currently provide grants for starting or expanding a small business.
The U.S. Small Business Administration administers the nationwide SBDC program while implementation of program in Alabama rests with the Executive State Director and the participating organizations within the state.
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Corporation Vs Llc: Which Should You Choose
It can be difficult to decide the best entity for your businessespecially when the differences could spell success or disaster for your business.
Doing your research ahead of time can definitely help you make an educated decision, but its important to also seek expert advice so you start your business on the right path to success.
Lucky for you, Inc Authority is chock full of business formation experts who can walk you through these important differences and help you make the best possible decision for your business.
Incorporating is the most powerful thing you can do to legitimize your startup. And at IncAuthority.com, our setup LLC services are 100% free. Always. So, dont wait. Form your new LLC today and enjoy the protection due to you and your business under the law.
What are the advantages of an LLC?
The main advantage of forming an LLC is to limit personal liability because LLCs have their own existence. Other advantages of an LLC include the following: LLCs can be governed informally. They do not require a board of directors, meetings, quorums, minute keeping, and other management formalities. LLCs have flexibility in deciding how to split their financial interests. An LLC can distribute its income to each member equally, based on his or her capital contributions, or in many other ways. An LLC can be a pass-through tax entity without the restrictions that are imposed on corporations.
What are the disadvantages of an LLC?
Available Government Grants For Single Moms Starting A Business
National Association for the Self-Employed Growth Grants
The National Association for the Self-Employed runs an annual grant program that is available only to their 50,000 members and single moms who are in business are encouraged to join. To become a NASE member, you have to pay $120 per year for a basic membership.
NASE offers members networking and mentorship resources, discounts on business products, and legislative advocacy. In exchange for membership, members are also offered exclusive access to grants and scholarships. Since 2006, NASE has offered nearly $1 million in grant money to members.
To qualify for their Growth Grants programin addition to being a NASE memberyou must demonstrate a specific business need that could be aided by the grant. You must also show how the grant will improve your businesss overall growth and success and include a resume and business plan. You can get more info about this grant by visiting their official website.
Small Business Innovation Research program was implemented by Congress. This program awards approximately $2 billion to small businesses each year and a good number of single moms have benefited from this grant. Eligibility requirements include owning a small business with less than 500 employees.
NASE Growth Grants
Small Business Administration
Womens Business Centers
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Targeted Economic Injury Disaster Loan Advance Grant
Certain small business owners applying for an Economic Injury Disaster Loan through the SBA are eligible for an emergency cash advance of up to $10,000. This advance can be forgiven by the SBA if you spend it on maintaining payroll, paid leave, increased costs, mortgage or lease payments, or other financial obligations.
Targeted EIDL funds are available to businesses in low-income communities that can demonstrate a more than 30% reduction of revenue during an eight-week period since March 2, 2020. Your business must have previously received an EIDL Advance for less than $10,000 to be eligible, or previously applied for an EIDL Advance but did not receive one due to a lack of program funding. The original EIDL Advance program, authorized as part of the CARES Act, is no longer active.
No action is required to qualify for a Targeted EIDL grant. The SBA will reach out to eligible businesses. If you receive an email about an SBA grant, make sure it arrives from an address ending in @sba.gov to avoid a potential business loan scam.
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Alternatives To Business Grants
Business grants may not always be available or suitable for your business.
But the good news is that there are alternatives to business grants out there, such as:
Equity finance This is when you sell a share of your business in return for finance. Some equity finance schemes opens in new window, such as the Seed Enterprise Investment Scheme, offer up to a 50% reduction in income tax on investments made in new businesses up to £100,000. Businesses have to be less than two years old and have fewer than 25 employees.
Soft loan These are similar to grants, but are actually loans opens in new window with lower interest rates and more generous terms than can be found via other lending routes. Backed by the government, the Start Up Loans scheme opens in new window offers personal loans of up to £25,000 with a 6% interest rate and access to free business support and mentoring.
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