Do I Qualify For A Startup Grant?
Free money to start your business – isn’t that every entrepreneur’s wildest dream? It’s too bad that startup grants are so hard to come by. You can think of business grants sort of like scholarships for adults. Just as with a scholarship, you have to convince the grant-issuer that a) you will put the funds to really good use and b) you are more deserving of the money than other applicants.
There are many types of business grants offered by myriad organizations, both public and private. As you might figure, there are different eligibility requirements for different grants. In general, though, only certain types of businesses are eligible for grants. These include businesses belonging to economically disadvantaged demographics such as Native American Indian tribe members, single mothers, and veterans returning to civilian life. There are also grants for innovative businesses breaking new frontiers that benefit society—think green tech startups, doctors, and scientists.
In this post, I’ll talk about the types of businesses that might qualify for a startup grant, and give a few examples of organizations that offer grants to these businesses.
If you belong to any of the following business categories, you might eligible for a startup grant.
Table of Contents
Innovators
Many startup grants are for innovators and businesses that contribute valuable creations to society. These grants are generally for entrepreneurs in the fields of technology, medicine, science, agriculture, education, and research and development. Here are some grants you might qualify for if your business falls into this category.
Grants.gov
While this is the one-stop shop for all U.S. government grants, the majority of these grants go toward businesses and nonprofits in science, medicine, and R&D.
Search for grants on Grants.gov or check your eligibility to apply for a grant from the federal government.
SBIR
From The Small Business Innovation Research (SBIR) website:
The SBIR program is a highly competitive program that encourages domestic small businesses to engage in Federal Research/Research and Development (R/R&D) that has the potential for commercialization.
This US government-funded program awards grants of up to $150K in Phase I of funding. Depending on the results achieved after six months, recipients may receive up to $1 million over the next two years (Phase II).
NC IDEA
This is a private foundation offering up to $50K for high-tech companies in the state of North Carolina.
Green Businesses
There are some public and private grants for green businesses, including startups. Generally, these grants cover the cost of installing sustainable infrastructure and/or energy systems.
Rural Energy For America Program
As part of the USDA (U.S. Department of Agriculture), this program awards renewable energy systems and energy efficiency improvement grants. Grants are awarded to agricultural producers and rural small businesses for renewable energy systems or to make energy efficiency improvements.
Green Technology Business Grant Program
This grant is designed to attract new green technology businesses or to expand existing green technology businesses in the City of Cleveland, Ohio. Eligible applicants may receive grants of up to 0.5% of new payroll to the city for up to five years and may also qualify for an additional $5,000 Moving Assistance Grant.
Rural Businesses
Various grants aim to stimulate the economy in rural and economically distressed areas. These grants serve to attract new businesses to struggling regions. Depending on where you are opening your business or nonprofit — and the specifics of your organization’s goals –, you might eligible for some of this grant money.
Rural Business Development
This grant is specifically for nonprofit and public entities. From their website:
This program is a competitive grant designed to support targeted technical assistance, training and other activities leading to the development or expansion of small and emerging private businesses in rural areas which will employ 50 or fewer new employees and has less than $1 million in gross revenue.
From the same agency, rural farmers/agricultural producers might be eligible for the Value Added Producer grant, while for-profit businesses that provide education or health care to rural areas through telecommunications might be eligible for the Distance Learning and Telemedicine grant.
U.S. Economic Development Assistance Grants
From their website:
EDA supports development in economically distressed areas of the United States by fostering job creation and attracting private investment. Specifically, under the Economic Development Assistance programs (EDAP) Notice of Funding Availability (NOFA), EDA will make construction, non-construction, and revolving loan fund investments under the Public Works and Economic Adjustment Assistance (EAA) Programs.
Interested? Check out the EDA’s grantee resources.
Women-Owned Businesses
There are certain business grants you might be eligible for if you are a female entrepreneur. Additionally, some grant money goes to businesses that create solutions that benefit women and families.
Amber Grants
Amber Grants is an organization that awards $1,000 to a woman-owned business every month, and at the end of the year, one of the 12 monthly qualification winners wins another grant for $10,000. These grants do not have any particular qualification criteria, other than that recipients must be female entrepreneurs (age 18 and up) living in the United States or Canada. Amber Grants are open to any type of business and you can apply online.
Chicago Foundation For Women
Women living in the Chicago metropolitan area are eligible to apply for a grant to start a new business through this nonprofit fund. Grants range from $15,000 to $150,000. These grants are very competitive and are only available to businesses that benefit women’s economic security, freedom from violence, and/or access to health care.
Nonprofit Organizations
Nonprofit startups that have 501(c)(3) status with the IRS are eligible for some government and private grant money. In fact, you’re much more likely to be awarded a grant if you run a nonprofit organization, as opposed to a for-profit business. While there are tons of nonprofit grants, I won’t spend too much time on this section, assuming this audience is mostly for-profit entrepreneurs.
Wells Fargo Community Giving Grants
These grants, which you can apply for year-round, are mainly for nonprofits and educational programs, though some small businesses may be eligible as well.
As mentioned, Grants.gov is the main stop for government grants, many of which go to nonprofit causes.
Veteran-Related Businesses
Veteran business grant money includes retraining grants for veterans returning to civilian life and grants to nonprofits providing services to veterans.
StreetShares Commander’s Call Veteran Business Award
This StreetShares program awards annual grants to veterans and spouses of veterans who own small businesses. The first place award is $5K, the second is $3,000, and third is $2,000.
StreetShares also offers conventional business loans to some small businesses, veteran-owned or otherwise. Head over to our StreetShares review for a rundown on their loan services.
Wisconsin Department Of Veterans Affairs Retraining Grants
This program awards up to $3,000 per year for up to two years to veterans receiving job-related training. Most “startups” probably wouldn’t be eligible for this program, but hey, it’s possible.
2501 Program
These grants, awarded through the USDA, go to veteran and minority farmers and ranchers. You might think that most startups aren’t in the farming sector, and you’d be right, but ag-tech startups are gaining prominence—think sustainable farming and other “smart” farming practices now possible with the help of new technology.
Minority-Owned Businesses
While there are grants designed to benefit various non-white business owner demographics—Hispanic Americans, African Americans, Asian Americans, and others—most government grants for minority businesses are specifically for members of federally recognized Native American Tribes. Here are a couple grants that may help fund minority-owned startups.
Community Programs To Improve Minority Health Grant Program
Healthcare-related small businesses can use this grant for programs that provide health services to minorities.
Native Arts Capacity Building Initiative
Offered through the American Indian First Nations Institute, this initiative awards six grants of up to $30,000 each year to Native American institutions that support arts and culture.
Note that while the Minority Business Development Agency offers various resources designed to help minority business owners, this program does not include grants.
Just Plain Amazing Small Businesses
There are a few general small business grants available to any kind of business, but they are very competitive, so you will need a super impressive story to wow the judges. An impressive track record is a particular challenge for a startup business, which is usually defined as a business that’s been around for less than six months. But hey, if you’ve achieved a lot in just a few months or you have an especially amazing idea, you might want to apply to one of these highly competitive small business grant contests.
FedEx Small Business Grant Contest
Any type of small business may apply. To give you an idea of what kind of competition you’d be facing, in 2017 there were 4,500 applicants and 10 winners. The grand prize is $25,000, and the other winners in the top ten get $5,000.
Visa’s Everywhere Initiative
This contest awards startups with innovative IT solutions, awarding $50,000 to the top three finalists.
Small Business, Big Impact Award
This small business contest, sponsored by email marketing platform AWeber, awards a grand prize of $20,000 and is specifically geared toward startups, as well as nonprofits. The entry period for this contest began October 15, 2018 and will end January 4, 2019.
Startup Grant Alternatives
Very few private businesses are actually eligible for a business grant. Unless your business or startup is highly innovative and provides a demonstrable benefit to your community or the world at large, unfortunately, you are probably not grant-recipient material. Even if you are eligible for some grant money and you make it through the lengthy proposal process, you may only land a few hundred to a few thousand dollars.
Furthermore, startup grants are particularly hard to come by, as grantees will generally want to see what kind of results you’ve achieved on other projects carried out by your organization. Don’t fall for government grant scams that will have you believe there are piles of free grant money out there for the taking—this is not the case at all.
So, rather than hoping to be among the fortunate few who are granted free money, you might want to look into grant alternatives for your business.
Startup grant alternatives include crowdfunding, P2P lending, online loans, equipment financing, and others. Some examples might include:
- Launch a Kickstarter campaign
- Get a 0% interest crowdfunded loan from Kiva U.S.
- Get a startup loan from Credibly
- Apply for a PayPal Working Capital loan
- Use Fundable for equity-based business crowdfunding
For more ideas on how to get the seed money for your new business endeavor, check out our article on the best ways to finance a business startup.
| Lender | Borrowing Amount | Loan Term Length | Interest Rate | Origination Fee? | Min Credit Score | Next Steps |
|---|---|---|---|---|---|---|
| $1K - $50K | 3 or 5 years | 8.16% – 27.99% | Yes | 620 | Apply Now |
| $2K - $35K | 3 or 5 years | 6.95% - 35.99% APR | Yes | 640 | Apply Now |
| $25K – $300K | 3 – 7 years | 0% -15% on first 9 – 15 months | Yes | 680 | Qualify Now |
Shannon Vissers
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My husband and I started a factoring company in August, which is in the transportation industry. We are growing and are looking at expanding. I am looking for Grants for business expansion. Do you know of any that might be of help to us in this area?
Hi Carol, I don’t know of any specific government grants you would qualify for, but you can check Grants.gov to see if anything might be available that fits your qualifications (though most of those grants are for nonprofit organizations and medical research). You might also check to see what’s available in your local area because sometimes local governments offer grants to incentivize business growth in their region. You are also probably eligible to apply for the FedEx Small Business Grant Contest.
Im a single mother working two jobs and looking to open my own restaurant. How do I go about getting a grant or several grants?
There aren’t many federal grants available for for-profit businesses. Of those limited grant offerings, most want to see an established business record. However, you can always check Grants.gov to see if there’s anything you might qualify for, and also check your local SBA Women’s Business Center to see if there are any grants or other financing opportunities you might qualify for in your area. There are also some nonprofits and private companies offering business grants for women which you can read about here: https://www.merchantmaverick.com/the-best-business-grants-for-women/
Hi Shannon. I am looking to start my own welding business. A mobile service truck that can go to customers in the field. I am a welder and am currently working on my AWS certifications. I don’t know if this would help me with a grant, but I was incarcerated for 30 years and just got out July 2018. The banks won’t give me a loan because I haven’t been out for 2 years so I have no real credit history. In my area there are many farmers and loggers who inevitably need repairs and me being able to go to them stops the need for them to haul broken equipment to a shop. What do you think my chances are and how should I go about doing this?
Hi there! Grants are more for nonprofits and businesses involved in research and development, such as medical research, green energy, stuff like that. I think it may be possible for you to get an online loan, as some of them don’t have very stringent credit score requirements. There are also a couple nonprofit online lenders like Kiva and Accion that you may qualify for. You might also want to visit your local SBA office to see what business financing resources they might have for you. Good luck!
I am looking for start-up funding for a 3d printing dental lab .(Wave of the future,,, milling will be obsolete).Need funding that will put company thru to the top of 3d printing. Need sustained funding to cover sales, equipment,facilities,staff salaries and continued research to make this a successful disrupter of old tech.I have lots of years in dental lab tech field.I am a master tech (25 years ).Now I need high tech funding to move the Industry to the digital age.
Hi William!
That all sounds very exciting! I’d definitely suggest reaching out to the grant providers we’ve listed in the article for you, and even more specifically, the Innovators section may apply to you. Best of luck with seeing your vision to fruition!
Great, informative and well constructed article. Most just point us to an affiliated company’s website and want money just for information. I have been searching for any way at all possible to help fund my startup in Residential/Light Industrial remodeling, improvements, maintenance and property management. With 25+ years in the field, I by far have the knowledge and experience to thrive in this venture. Unfortunately, I have 6 kids that must be taken care of before being able to save…and the saving has yet to be an option. In what ways would I be best vested in this opportunity for my family, employees and the Metro Detroit communities in which we serve to focus on and push for to help with the funding needed to legally operate as such an entity? I understand that all monies paid toward the start of and growth of the company are tax deductible. Would that also be true if the monies are from a loan or grant?
Hi Jason! You may be able to find some local grant or loan opportunities for startups in Detroit, but I am not personally familiar with any of them. It’s definitely worth looking into though because I can imagine there are resources out there to encourage economic revitalization in the region. A local bank/credit union or nonprofit lender like Accion might also be able to offer you a low-interest loan — Accion has local loan offerings you can find on their website by entering your area code. In regard to taxes, loan proceeds are not considered income (as you will be paying this money back) so you will not pay any taxes on that money. Grant proceeds are taxable, however.
I’m looking for money to start a fiber farm in Michigan. I would also like it to be a place where kids can come and get educated on how a small scale farm business runs.
Hi Virginia,
I’d definitely suggest looking into the resources we’ve provided for Rural Businesses, Women-Owned businesses and/or Non-Profits listed within this post. It sounds like any of those might be beneficial to you. Good luck!
Hi. I’m Stephanie.A single mother of 3 I graduated Beauty School Feb.14,2019. And. I was. Wanting to open a business to be able to sale. Hair products for natural hair. As well as. Bundles . hair accessories things in that nature. What grant should i Apply for..
Hi Stephanie,
I’d suggest reading the portion of this post dedicated to Women-Owned Businesses.
Any help with Grant to start up a discount tire in Alabama
Hi there! I’ll just reiterate what I said in the article, because this info hasn’t changed:
I am a single minority mother who is trying to start my own clothing line. Until I can reach my full potential I would like to start with creating graphic t shirts. What grants should I apply for?
Hi Erica! I’d recommend applying for Amber Grants, which gives out one $2,000 grant to a female entrepreneur each month and one $25K grant each year. You should also apply to GirlBoss, which awards one $15K grant to a female-owned creative startup every six months. And here’s another article I wrote on business grants for women with a few other options. Best of luck to you!
I am trying to start up an cell phone and wifi provider company any advice would be greatly appreciated
Hello, unfortunately I don’t have any information about grants for your specific industry. Sometimes cities and counties will have local grant money earmarked for tech-based businesses, though, so you might want to check with your local chamber of commerce.
Have you ever found any grants or extra help toward a loan for widows with dependent children? I have excellent credit, but “not a real job” – I’ve been told before when I applied for a home loan because I’m a substitute teacher. So, I’m pretty sure I’m going to have a hard time with banks for a start up loan. So, looking for fresh alternatives too, besides crowdfunding, which takes a percentage off the top.
Hi, I haven’t come across a grant for your specific situation; usually, grant eligibility has to do more with the type of business you have rather than your personal situation (though there are a few business grants just for women). You might be able to get a startup loan through an online/alternative lender, or another option is a personal loan from a company like Prosper, LendingPoint, or Upstart. Those lenders pretty much only care about your personal credit score, and you can get up to $25-$50K.
Is grant funding actually available for someone who isn’t a non-profit? (Working in the mental health arena)
Thank you!
There are very few grants available to for-profit businesses, and those grants are typically very competitive and/or not very large. However, based on your profession, it is possible that there could be some local grant money that could be available, as health industry-related businesses and other businesses that benefit the community are sometimes eligible for grant money. I’d check grants.gov and do a local search for grants in your area that you might be eligible for.
hi am looking for help to sart up an electronic shop in uganda
Hello, I don’t know much about international grants/loans so you would need to check with your local agencies. However, I know that Kiva is one organization that provides small startup loans internationally.
I’m looking for startup money for a cleaning business
Nikefa,
Take a look at our blog post The Step-By-Step Guide To Starting And Funding A Cleaning Business or How To Find A Startup Grant. These should help you get started. All the best!
Hi, I am looking to open my own RV and boat storage facility in California, are there any grant’s I should look into? Also I would like my long term boyfriend (10 year, 2 kids, we dont believe in marriage) to be part owner with myself. Is it a better idea to look into grants for women or are there any other options? We are not planning on employing anyone at our facility, it would just be ran by us. Any help is greatly appreciated.
Unfortunately, that kind of business isn’t really the type that would qualify for a grant. Grants are mostly for nonprofits, medical research, and businesses that would greatly benefit their community or industry in some way (for example, a green tech company that would employ a lot of people in a rural area). There are a few small business grants for women, but these are essentially business competitions that looking to award only especially innovative or creative startups. Your best bet would probably be a startup loan.
Hi! I have been searching for grants to help me start a small business in Cookies I developed, actuall two of them which I want to market like in groceries, etc. I have the ideas like in packaging, design and a good name brand. I need help in nutrition facts to check my cookies, apply with no cost trademark? Can you help me and give me Legit agencies who can help me? Thank you in advance!
Hi Eileen,
I’d definitely suggest checking out the resources we’ve vetted within this article. They would be a great place to start! Good luck with your cookies!
I’m a single mother looking for a grant to start a food truck.
I am wanting to start a quilt shop in South Eastern Kentucky. Is any small business grant for women? Is any grants or loans that does not require you put lien on your assets.
Hi Karen, here are a couple resources I’ve written which include some unsecured loan options and a list of business grants for women:
https://www.merchantmaverick.com/best-unsecured-business-loans/
https://www.merchantmaverick.com/the-best-business-grants-for-women/
I need Grant to open a small Deli restaurant and North Carolina Smithfield
Exciting! We’ve got lot’s of grant resources available for you to explore! Best of luck to you!
I need help getting a grant fast to open a nutritious smoothie and juice bar.
Hi Kayla,
Why don’t you start with this article on finding startup grants. It’s full of excellent resources. Best of luck to you!
How do I apply for grants to start a food business or for a food truck?
Hi Dior,
We haven’t yet researched Food Truck specific grants, but we have a lengthy list of grant resources that should be able to help point you in the right direction. Check it out! And good luck!
I need to get a new business grant for my BBQ place
This article is a great place to start, Damon. Best of luck to you!
I’m looking the money for for start open restaurant business in baton rouge Louisiana State.
If you aren’t too sure if you’d qualify for a startup grant, you might want to take a look at our Startup Loan Comparison Chart. Good luck!
Nice post! Thanks.