Probably the greatest concern any would-be entrepreneur has initially is funding. When starting a business, the old saying that you need to spend money to make money holds true. However, if you know where to look, there are quite a few resources you can tap to help you find the money you need. One of the best sources for business startup funding is a grant. Provided you have a feasible business, you could apply for one of these so you could get your business running in no time.
If there’s one thing true about business startup grants, it’s that applying for them is very challenging. Although there are many agencies and private companies that can potentially provide you with financial assistance, you will find that for every available grant there is, dozens of hopeful would-be entrepreneurs are just waiting to be the next recipient.
When looking for business startup grants, be ready to compete. In fact, if you need help writing a grant proposal for your business, you might even want to consider asking for assistance from someone more knowledgeable about the application process or a professional grant writer.
You should also know the eligibility requirements associated with certain grants. Some grants, for example, restrict the applicant’s age, geographical location, sex and race. The purpose for which the funding will be used will also be carefully scrutinized. Qualifications can be highly detailed and in some cases, rather difficult to comply with.
Agencies who offer grants are very picky. If you can’t show that your business has a strong potential for succeeding, you’ll find it difficult to win a grant.
Where to find a business startup grant
There are several sources of business startup grants that you can tap. These include:
Asking for a state-provided business startup grant is an excellent first option because it is relatively easy to apply for. Competing applicants are also lesser in number compared to those you will meet at the national level. Applying is also convenient and you’re likely to receive a positive response since these state agencies have a good understanding of the market and the business industry in general.
A caveat, though: applying for a business startup grant from this source is easy but it does have a few challenges. Most grants are designed to address a specific need in the business, such as purchase of supplies or inventory, construction, etc. You’ll have to be very creative in making sure that your business plan is a match to the available funding.
The national government offers several opportunities for you to apply for and receive a business startup grant. However, there are some specific requirements you’ll have to meet to qualify. Most of the grants available through federal funding are designed to assist non-profits. If you want to win a grant from this source, make sure you look carefully for opportunities that for-profit businesses like yours can qualify for.
Local government departments
There are business startup grants that are available for entrepreneurs with special needs. Women, minority groups and people with physical disabilities are often recipients of these grants. These sectors usually have special needs that may not always be given priority by more traditional grant providers.
Advantages and disadvantages of business grants
Unlike loans, business startup grants are free money – that means if you do become a recipient, there’s no need to pay it back. You only have to qualify for it and present a clear purpose as to how the money will be spent in the business. This is also the very reason why competition for business grants can be rather tough.
However, if you’re prepared for it and have a clear and feasible purpose for your business, there’s a good likelihood that you could get approved.