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Grants for Starting a Small Business: Myth or Fact?

Updated on March 18, 2011
Is talk about free grants just a sales pitch?
Is talk about free grants just a sales pitch?

You've seen the infomercials claiming that the government is handing out free grant money to everyone who asks for it. The people in the infomercials make it sound like all you have to do is ask Uncle Sam for money and you are bound to get it. A common selling point of the infomercial is free money from the government to start a small business. Are there really grants for starting a small business that are available for anyone and for any business?

When viewing such infomercials, the audience must understand that it's a commercial. They are trying to sell something. They are selling information about how to obtain free money. It's a great idea. Everyone wants free money. But, the commercials are misleading at best.

Are there government small business grants? Of course, there are. BUT, the vast majority of small business grants are for very specific types of businesses. Unless you want to start a medical research facility or other highly scientific, specialized businesses, the chances of getting a grant to start a business is extremely low in some and non-existent in most states.

States? Yes, states. Many infomercials imply that grant money is given by the federal government and in some cases it is. But, US government grants are most often given to states and agencies rather than individuals. For example, research grants are given to colleges and businesses to research a specific field. Federal human service grants are given to organizations that either research or serve the community in specific ways such as drug abuse rehabilitation or fighting homelessness.

According to the US Small Business Administration, there are no grants from them to finance the start of a small business. If you click the link to take you to their "Grants" section, the page is titled "For Borrowers" and is about their loan programs. An existing business has a small chance of getting a grant from the SBA, but a person cannot get a grant to start a business.

Some people may think that I am being a little harsh in reference to the infomercials. But the fact is, the information that they sell is free to the public. It's not hidden. It's no secret. It's free and a matter of public record. I feel passionately about helping people find what's free for them to know rather than overpaying for fluff, conjecture, and the dream of free money. I feel that some people have taken advantage of the financial desperation of the times.

For more information about government grants, please visit my website:


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    • Sheila Wilson profile image

      Sheila Wilson 7 years ago from Pennsylvania

      I did check out before, but it looks like they are almost all research and social service grants for institutions and non-profit organizations. There may be a few for individuals, but not like what infomercial gurus claim. You won't find a blanket grant to start just any business. I know what you are saying about the SBA. From what I understand, they are no longer giving the Women in Business grants.. though again, I could be wrong. I haven't checked that in awhile, but the SBA website has a general statement that they are not offering any grants to start a business.

    • RGNestle profile image

      RGNestle 7 years ago from Seattle

      Yeah, it's hard to trust the SBA. Please don't take this as anything racist or sexist or anything, but if you are a white, healthy, heterosexual male, the SBA doesn't even care to talk to you most the time. I found this out first hand.

      Great business plan, already possessed most of the start up equipment, and the know-how and personnel, but the SBA said they couldn't help me at all because there were no programs for me. I wasn't a minority, I didn't have a disability, and I wasn't gay.

      The best bet for grant info is the Government's official grant site:

      Sadly, even though so many people say anyone qualifies, there is almost nothing for individuals and nothing at all for health, white, heterosexual males unless you are planning to go to school in another country.

      A good thing to do would be to get the business plan and prospectus together and find you local Investors' Club. Do an Internet search for your local area. They often do real estate, but a good business proposal can get a savvy investor salivating!

      Best to all of you out there looking for seed money. It's there. Just be creative in finding it!

    • K9keystrokes profile image

      India Arnold 7 years ago from Northern, California

      It's always the fine print that gets us as consumers...

      Quite an awakening article that hopefully saves even one person some heart ache.