When a small business owner hits a financial rough patch, the usual solutions are loans and credit cards. Both of these payment options end up putting a potentially struggling business further into debt. They may solve the current problem but set the owner up for a repeat occurrence later.
As an entrepreneur in charge of your own company, chances are, you’ll find yourself in that dilemma at some point. However, you’re one of millions of SBOs in the same boat, and there are lots of grants out there to help.
Apply for a Grant, Not a Loan
Grants are a specific form of financial aid that can come from a private business or corporation, or the government. These entities want to see owners like you succeed because it helps the collective society.
They provide “free” money to SBOs who meet the grant’s criteria. And since it’s a grant, it doesn’t have to be paid back. Ever.
Instead of turning to a bank or alternative lending source, why not see if any of those small business grants are geared toward you? Here’s how to get started on your search for free money.
1. Learn the Categories of Grants
There’s a grant for almost every type of business owner. You should qualify for at least one category, but don’t be disappointed if you aren’t eligible for most of them. It depends on the type of business you have and your own personal situation.
Some of the most common grant types include:
- Government grants for niche industries, such as agriculture, health, and education
- Private grants aimed toward businesses that fall under the grouping that the entity offering the money is interested in funding (for instance, startup capital for new owners)
- Grants for entrepreneurs who meet specific characteristics, such as location, ethnicity, gender, etc. (an example would be this list of grants for black women business owners)
Now, there are also a variety of grants for small businesses that suffered a financial loss due to the COVID-19 pandemic.
If you and your business fall under any of these categories, there’s a grant with your name on it somewhere.
2. Search for Your Perfect Grant
Learning those grant categories and which ones fit your business is essential before you start searching for free money. Otherwise, your search engine results are going to be full of options that aren’t relevant at best and fraudulent at worst.
To get you started without the junk, do a keyword search for your business category on one of these legitimate grant resources:
- Grants.gov is a site that comprises a list of grants offered by the government. Keep in mind that government grants have a lot of fine print and extra requirements that you’ll need to fit in order to qualify.
- GrantWatch is a subscription-based service that houses an up-to-date list of every type of grant available. Although there’s a fee to access the site, it’s worth it if you can find free money.
- Small Business Development Center, or SBDC, is the go-to resource for business owners of all sizes. This resource includes a massive network of people and businesses that work together to ensure everyone’s success. You’ll find research, strategies, and help with finding grants here.
As you attempt to navigate the grant scene, reach out to the departments listed along the way. Send emails asking for help and guidance. Some will be ignored, but you never know when someone will respond with a valuable gold nugget of info.
3. Understand What You Qualify For
Before you start filling out the applications for a grant, review the requirements thoroughly. You don’t want to spend hours on an app, only to find out you’re missing one factor.
One smart way to do this is to start with a list of your business’s features. Look up the most common questions you’ll be asked on most grants, and write down the answers to each one. That way, as you scan over the details for a grant, you’ll know immediately whether it’s worth your time and effort.
Individual grants often use these details to decide if a business qualifies:
- How long have you been in business (are you a startup or an established owner?)
- Your distinct “owner” characteristics (niched, minority, veteran, etc.)
- How many part-time or full-time employees you currently have on the payroll
- Your current revenue, either monthly or annually
- Your plan for the funds the grant is offering
- An “elevator pitch,” which could be requested in writing, a slideshow, or a video
- A current business plan that shows an accurate picture of the overall health of your company
- Photos of you and any other business owners, as well as your professional social media handles
When a grant requests all this information, you’ll have it on hand. And if the qualifications don’t match your business, it’s easy to move on before you lift a finger on the application.
Conclusion
Whether you apply for a loan or a grant, there’s paperwork and a wait process involved. So why not choose the route that gives you free money instead of putting your business further in debt?
Whatever your business’s unique needs are, these tips will help you find a grant that boosts your success.
