A grant could offer funding to help your business start-up grow. But even professionals can find it hard to maintain a record of the hundreds of various grant schemes. You must recognize relevant grant schemes and understand whether your business can qualify. You must also understand the application procedure and decide whether it is worth applying or not. Confused? No worries. Here are some of the important ways to get a business grant.
Small business grants are often a hot topic among small business owners and entrepreneurs. It is simple. Locate a government small business grant, apply, and before you realize it, you get a business grant. However, those government grants usually do not exist unless you are in high-tech or scientific research. If you are in one or both these areas, you can find out which business grants are available and if you may qualify by checking the Small Business Innovation Research Program.
As far as funding is concerned, there is not a one-size-fits-all attitude. Apart from every business having special funding requirements, each funding option differs inaccessibility, funding amounts, terms, and eligibility criteria. Here, is a list of places from where you can do the research and find the best option for your business.
Where to Find Business Grants
Business grants are available through certain state and local programs, some non-profit organizations, and several other groups. For instance, states may offer grants for growing childcare centers, producing energy-efficient technology, and creating marketing campaigns for tourism. These business grants generally need matching funds or merge the grant with a loan. The amount of the grant money available differs based on the grantor and business.
Federal, local, and state governments do offer varieties of financing programs to help small businesses begin and expand their operations. Consider checking the Small Business Association’s online resources like ASBA Loans Explained.
Ways to Get a Business Grant
One of the significant ways to get a business grant is to first determine how much money you will need. Assessing your startup costs is not just a necessary element of your financial plan, but it can help you to determine how much money you need. This can give you a jumpstart on your financing search and narrow down the potential choices based on the amount they recommend.
In addition, having a cohesive financial plan in place can enhance your chances of getting approval for money. It shows forward-thinking on your part and for investors, traditional loans, and any other funds that need a business pitch or plan, it is important to be considered. When you have planned out how much money you will need, it is time to survey your choices.
Traditional loans- One of the most widely available choices is a traditional business loan. And while the procedure and requirements may be quite similar no matter the lander, there are various loan options you must consider.
SBA Loans- Small Business Administration (SBA) loans are often one of the first places that small business owners in the United States think of searching for a loan, and they are right to think in this manner. This can be a great option if you fit this criterion.
If you are not sure whether you will qualify or not, read on for details on the SBA Loan program. Or if you have applied and had rejected your application, find out ways to improve your chances of being approved if you try to reapply.
Bank Loans- Bank loans may be the most apparent solution for business owners looking for money. While lending standards have become stricter with time, there are often money set aside specifically for small businesses based on the lender.
Look around and search for lenders with whom you can talk to while applying. This helps to ensure that you are filling out the important paperwork and offers insight into what you can do to enhance your chances of being approved. You will usually have better luck chatting with a real person at a credit union or a local bank, so do your research and chat with various institutions to find the right choice.
Small Business Lending Fund- This is a dedicated government fund that offers money for small business loans through certain lenders. The main benefit of this program is that it is designed specifically for growing the economy. The more a bank raises its loan output the less it must pay for funding. Giving access to loans to more businesses and potentially passing along improved rates or terms to business owners. You can find out which banks are participating and then download an application through the website of Treasury, which is updated on a regular basis as banks enter or exit the program.
Grant funding-potential issues
Do not waste your time in trying to achieve a grant unless you are prepared to overcome the four potential obstacles in the initial stage. These are:
- You must be ready to spend your own money
- Typically, grants cover about 15% to 60% of the total money required for a project. It is very rare for a grant to finance about 100% of the expenses of any project
- Even if a large proportion of the project cost is available, still you will need to invest time and resources in researching and applying for the grant
Usually, grants are only available for the specified projects
- For instance, investment in capital equipment, researching and creating a new product or process, or training programs
- The normal, organic procedure of company development does not generally qualify. However, there may be support to help your business set up and create new jobs.
Must have a clear project plan
- You may already have a business plan. The plan will require changes to focus on the specific project involved
- You will possibly need to show how aa project ties in with your business strategy
Grant schemes always impose restrictions
- Projects that are underway don’t come under the eligibility criteria. In most of the cases, you must have the ability to show that the project would not get completed and attain the same benefits without a grant.
- The project must help towards attaining the objectives of a grant provider-generally a department, agency, European or national government.
Ways to get a business grant
If you do find a small business grant program available for your business, be prepared to go through a long approval process. With funding reductions and high competition, be prepared with these 5 tips:
- Give complete and precise information in the application. An incomplete application may not make the review procedure or will delay the review as well as the approval procedure.
- Know your grant officer and their limitations, their requirements and timing
- Be different from others with a well-designed business plan, as needed. Show how the grant will help your business and satisfy the objectives of the business grant
- Bring in outside professionals as appropriate and necessary. A consultant or an accountant can add credibility to your application procedure
- Be in touch with the grant officer in a professional manner. It is perfectly fine to ask if they have any concerns that you may solve.
The task of finding and applying for a business grant is not for the faint-hearted. Have an honest approach towards the alternative options initially, like loans, family and friends, personal credit lines, etc. Today’s, many successful organizations were grown in an old-fashioned manner, i.e. bootstrapping.