Business grants are tough to get, but not impossible—here are tips on how to get one

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This Article reprinted with permission of nerdwallet,

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Business grants may seem like the holy grail to small business owners, because they offer cash you don’t have to pay back.

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But finding someone can feel as pointless as searching for a lost treasure.

“Everyone wants to know: How do I get free money for my business?” Jane Steinfeld, director of entrepreneurship and economic development at the National League of Cities, an organization that supports local government officials across the country. “And I have the answer: It’s not that easy.”

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it doesn’t mean small business grant Not worth chasing – as long as you manage your expectations. Here are five tips to remember when searching.

1. Prepare in advance

The grant competition application window can be small. Prepare in advance so that you are ready to take advantage of good opportunities.

Salt Lake City-based Niche Snowboards has been in business since 2009, but had never applied for a grant before company leaders learned about FedEx FDX,
-2.52%
Small Business Grant Contest just four days before the application deadline. But he already had a strong mission statement and invested time and resources in marketing assets like photos and videos—which helped him pull everything together in a timely manner.

“We had all the building blocks in there,” says Anna Van Pelt, creative director of Niche Snowboards. “We had to put them all together for this grant.”

The company won one of the competition’s three $50,000 grand prizes in 2022. It plans to use the grant to develop an upcycling program for manufacturing waste, and to invest more in marketing.

When evaluating grant applications, FedEx judges look at the company’s website, social media profiles, sustainability efforts and whether it would make a good mentor to other small businesses, says Kelly Martin, who manages the company’s grant program. We do.

“These are questions you should have answered,” Van Pelt says.

Too Four ways small businesses can prepare for a recession

2. Understand the parameters and requirements

Local governments sometimes provide business grants as part of neighborhood revitalization or economic development programs. Facade grants and commercial corridor grants, for example, offer funding to help you update things like your storefront and signage.

You may encounter a smaller applicant pool in your neighborhood than in national grant competitions. But these can be matching grants, meaning you will have to invest some money in the project yourself. They may also narrowly target certain roads or census areas.

“Local government business grants” have a lot of strings attached, says Steinfeld. “There’s a lot of data that [business owners] Because that city would have to report back how all that money was used. ,

related: Three Options Of Small Business Loans

3. Look in the Right Places

If a government grant doesn’t meet a goal already in your business plan, it probably isn’t a good fit.

But if someone does, you need to make sure you know about it. Sign up for email newsletters, attend networking events, and consider working with a local business consultant to find out if these opportunities are available.

“Identify your county website, identify your city website, meet [the] People from the economic development of your community…or also get involved in community programs or government programs,” says Raj Tumber, a mentor at SCORE, a Las Vegas-based small-business coaching organization.

Also connect with your local business development organizations. These organizations may host pitch competitions, where business owners can try to sell their ideas to investors. Winners may receive grant funding or resources such as business coaching and office space.

The Business Incubator Program Is “The Only Place I Know Of” That’s True startup business grantSteinfeld says.

check out: How Entrepreneurs Can Raise Money for a New Business—and Benefits if You’re Over 50

4. Beware of Scams

Be wary of organizations that ask you to pay them and promise to submit your business to give contests. They can be cheaters.

“Anyone who is looking for startup business grants needs to understand that there are a lot of grant scams out there,” Tumber says.

For a reputable information source, Tumber recommends Grants.gov, a website that lists business grants available from the federal government. You’ll also find advice on grant-writing and how to report suspected grant fraud.

5. Turn to Other Funding Sources Too

Don’t rely only on grant money to grow your business. If you’re lucky enough to get a grant, it might accelerate your development – but it shouldn’t be the engine.

For example, the leaders of niche snowboards can share with friends, family, and . turned to small business loan For startup and expansion funding. They also use business credit cards to bridge gaps in cash flow.

Steinfeld also recommends building a relationship with a local bank.

“They have a lot more flexibility with underwriting than you would believe… when they understand what you are doing and are invested in you as a business owner,” she says.

Getting a business grant is exciting. But like many parts of running a business, it isn’t easy. Niche Snowboards was one of only 10 winners out of nearly 18,000 applications.

,[Winning] Really made us tear up,” Van Pelt says. “As most small-business owners know, funding — and simply the nature of small business — is intense.”

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Rosalie Murphy writes for NerdWallet. Email: [email protected]

Credit: www.marketwatch.com /

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