Small business grants have been around for many years. Traditionally, they help small businesses get started, but today, there are many options to help business owners stay open especially during COVID-19.
A business grant is money provided to businesses to open, stay afloat, or to fund a specific event, such as research and development. Unlike a loan, grants don’t require repayment, but you must meet the qualifying requirements.
Below are the top business grant options for small businesses both COVID-19 related and not. Look at all the options available to you and determine which option suits your needs, helping you set up, grow, and keep your business afloat.
COVID-19 Small Business Grants
COVID-19 hit small businesses the hardest, but the SBA has a couple of programs to help them stay afloat including:
- Shuttered Venue Operators Grant – This program helps businesses that offer live performances, such as theaters that were forced to shut down due to the pandemic. Only businesses open on or before February 20, 2020 qualify. Businesses may apply for the lesser of 45% of their 2019 gross revenue or $10 million.
- Targeted Economic Injury Disaster Loan Advance – The Targeted EIDL Loan Advance is a grant provided to businesses in need. The SBA will contact any eligible businesses– you don’t need to apply. The Targeted EIDL Advance is for businesses in low-income communities that had at least a 30% reduction in revenue. The advance provides up to $10,000 in financial relief.
Federal Small Business Grants
COVID-19 caused many businesses financial struggles, but before the pandemic, the SBA and other government agencies offered financial support for small businesses including:
- Small Business Innovative Research Grant – This program helps small businesses participate in federal research. The grant money can help with technological needs and science-based research. The grant has specific requirements including the need to be a for-profit company.
- USDA Rural Business Enterprise Grant Program – If you operate a business in a rural area and have less than 50 employees and less than $1 million in revenue, this program may provide financial assistance, especially if you’re a rural public entity. There isn’t a maximum grant amount allowed, but smaller requests take priority.
- Grants.gov – Grants.gov provides a comprehensive list of all federal grants, current guidelines, and availability of funds. Once you register for a Grants.gov account, you can search for small business grants, and apply through your dashboard.
- Challenge.gov – Challenge.gov offers businesses the chance to win free money to build their business by offering technical and scientific competitions. Browse the available competitions to see which your company may want to complete it and follow the links to determine eligibility, rules, and prizes.
- Small Business Technology Transfer Program – The STTR program is another ‘challenging’ grant program that offers opportunities to compete in Federal Research and Development winning financial prizes to help your business.
State-Based Small Business Grants
Beyond the federal level, some states offer small business grants for both COVID-19 relief and standard small business assistance.
- Small Business Development Centers – Use this tool to find your local SBDC and see what assistance is available to businesses in your state or region. Some states offer more help than others. Exhaust all your financial aid options to get the most assistance for your small business.
- Economic Development Administration – The EDA offers grants and numerous financial assistance options to help businesses start-up or stay afloat. Search for your state’s agency here, and see what options are available to you.
- State Business Incentives Database – This membership-based database offers access to programs throughout the country. It’s composed of economic developers, researchers, and financial professionals.
Other Small Business Grants
Besides federal funding, some private companies and organizations offer small business grants. Here are a few examples.
- NASE Growth Grants – Members of the NASE may apply for a government grant of up to $4,000 to grow your business.
- Veteran Small Business Award – The Street Shares Foundation which supports veterans in their desire to start a business offers the Veteran Small Business Award to provide veterans with the money needed to start or boost their business.
- Caleb Brown Urban Excellence Community Grant – This $1,000 grant helps young entrepreneurs who plan to help the community get started. The grant is available to both startups and existing businesses if they meet the standard requirements.
- Halstead Jewelry Grant – The Halstead Jewelry Grant offers up to $7,500 to jewelry store startups and those with a jewelry business looking to level-up or niche-down their jewelry business.
Small Business Grant vs Business Loan – What’s the Difference?
It’s important to recognize the difference between a small business loan and a grant. Both options offer financial assistance for your business whether to start up or keep it afloat and both have requirements you must meet to qualify, but the repayment terms are different.
A small business grant doesn’t require repayment, whereas a small business loan does. Make sure you read the fine print, understanding not only how to qualify for a grant or loan, but what the repayment requirements are before accepting the funds.
Bottom Line
Today there is plenty of help for small businesses whether you already own one or would like to start one up. Despite the pandemic, there are still plenty of ways to make it as a small business owner and with the help of a small business grant, you can get up and running faster.
Exhaust all grant options before looking for a small business loan. While most businesses need some type of financial assistance eventually, look at your federal, state, and private company grant options to see what assistance is available to you for free. This will give your business the best chance at succeeding from the start.