Small Business Grants: Free Money For Your Business
Small Business Grants: Free Money for your Business
Free money for your business may seem too good to be true, but the truth is there is grant money available to a wide variety of small businesses. The Small Business Association has a pretty large definition for small business. In fact, most mom and pop businesses do not even come close to the SBA’s definition of small business in either income or employee numbers. “The two most widely used standards to qualify a business as small are 500 employees for most manufacturing and mining industries and $7.5 million in average annual receipts for many non-manufacturing industries” (Beesley, 2014).
It is important to denote that this is a size definition used by the U.S. government to determine if a business is able to apply for their small business grants. These government grants are called the Small Business Innovation Research Grant and the Small Business Technical Transfer Grant. Both of these grant opportunities, funded by federal agencies with budgets greater than one million dollars, aim to stimulate innovation, research, and development, as well as collaboration between universities, entrepreneurs, and the agencies. The grants are broken down into three phases. In Phase I, the business must establish the merit, feasibility, and commercial potential of the research and development. These grants are less than $150,000 and should be completed within six months. Phase II supports the continuation of the Phase I research and development. Funding is based on the results but is less than one million dollars and should be completed within two years. During Phase III, the business is able to reap the benefits of extended research and development by pursuing commercialization of the developed product. The granting agency no longer funds this phase, but there is the potential for funding through other sources.
The definition set forth by the SBA can be misleading, as a small business with 500 employees is quite sizeable when compared to a startup tech company with only ten employees. A small tech company will have strong and mighty competition for these government grants. While this should not dissuade a tiny company from applying to these government grants, it should put the competition in perspective. These well-funded, extensive government grants are essential to American innovation and entrepreneurship, but a start-up would be wise to look for grant money a little closer to home.
Resources for Grant Money
Just like the saying, it takes a village to raise a child, it also takes a village to grow a business. Perhaps the best and most rewarding place to look for small business grants is in your own back yard. Your local economic development center is a great place to begin a grant search close to home, and they may even offer insight into the kind of businesses your area is hoping to attract. There are small business centers all over the country, and many of them have grant money in the budget to help entrepreneurs start up and grow their businesses. Many agencies set up grants that serve a particular kind of entrepreneur such as women, minorities, or veterans. A web search can quickly find grants applicable to a certain population or region. Each state will have small business grants available for supporting their economy, and there may even be funds at the municipal level. Another great resource for grant money is corporations. With the increasing demand for corporate social responsibility and the corporate world’s need for fresh and innovative ideas, many well-branded corporations have funding set aside to support their local economy and create an influx of innovation for their research and development.
Grow Your Business with Grant Money
Competition for grant money will always be tough because most small businesses can use a little free money. It is important to make sure your business qualifies for the grant you are applying to, so make sure to carefully look over application requirements before taking time to submit an application. Through a little bit of research and a lot of preparation, you can grow your business through grant funding.
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