Small Business Grants: Where to Find Funds

By Janet Berry-Johnson | Edited by Kurt Adams and Pearly Huang

Small business grants are funds offered by a federal, state or local government or a private entity like a corporation or foundation. The best part? Grants don’t need to be paid back the way business loans do.

Because grants are essentially free money, competition for grant funding is stiff. Plus, they may be available only to certain types of businesses or in specific regions. Learn where to look for small business grants and how to apply.

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Federal small business grants

One key resource for small business owners interested in applying for grants is the U.S. Small Business Administration (SBA). The SBA is a government agency created to help small business owners and entrepreneurs.

In addition to the SBA, several small business grant programs are available from other federal agencies.

If you’re new to searching for federal grants, Grants.gov — a database of grants from federal grant-making agencies — is a good place to start. There, you can find information on over 1,000 different grant programs, applications and other instructions for applying.

Once you register with Grants.gov, you can apply for multiple federal grants. Just keep in mind that it’s a vast database that can be difficult to navigate — especially if you’re looking for highly specific grants.

The SBIR and STTR programs are designed to encourage small businesses to partake in research and development and provide resources for the potential commercialization of any resulting innovations.

USDA offers quite a few grants to state and local governments and private and nonprofit organizations that can filter down to small business owners in rural areas. Direct grants may be available to farmers markets or roadside stand businesses — that’s in addition to direct low-interest government loans to new and family-owned farms.

The DOE works closely with the SBIR and STTR programs to fund energy research and development at small businesses. There are specific needs those businesses must meet and it’s a competitive field, but there is grant money if you fall into this category.

The EPA also offers specific grants for businesses in the green or environmental sector. These highly sought-after grants often go to government agencies, nonprofits or research institutions working on projects related to air quality, climate change and pollution prevention, to name a few. Some of these opportunities filter down to local businesses.

The NIH is the largest public funder of biomedical research in the world. The application process is lengthy but worth it if you can secure some of the more than $32 billion the NIH spends on medical research each year. Like some of the other federal agencies on this list, NIH works closely with the SBIR and STTR programs to fund small businesses that engage in research that supports the nation’s health.

State small business grants

Just like there are federal grants, state governments also offer small business grants. These grants are usually available through state agencies, where the competition may be less fierce due to the smaller applicant pool. They can also run across several states, so check the fine print before ruling one out because it seems to be out of your area.

State Business Incentives Database

The State Business Incentives Database can be a valuable database for business owners. It has a map feature that allows you to select your state and see the number of grants available and find information on tax credits and exemptions. However, it requires a login that is only available to members of the Council for Community and Economic Research (C2ER). A basic membership, which includes access to the database, costs $362 per year.

U.S Economic Development Administration (EDA)

Part of the U.S. Department of Commerce, the EDA can be an excellent resource for small businesses looking for state grants. The EDA collaborates with communities and regions to drive economic development across the country. It does so by offering grants and working directly with communities so they can encourage innovation and entrepreneurship.

Small Business Development Centers (SBDCs)

All of the research and work that go into applying for any business grant can be daunting, but the SBDC might be able to help. There are nearly 1,000 development centers across the country where business owners can seek free consulting and training on various topics, including cybersecurity and digital advertising. SBDC consultants can help you find and apply for the right grants for your business.

Private small business grants and awards

Businesses, associations, foundations, societies and other organizations may offer private grants to help small businesses launch or grow. Like government grants, these private grants and awards come with their own application requirements and are sometimes reserved for certain types of companies or those in specific industries.

These grants can be a little tougher to find because there’s no centralized government database. However, if you meet the requirements and win the funding, they can be well worth the time spent researching.

Shipping giant FedEx annually awards approximately 10 U.S. businesses with lump sum awards. Applications typically open in February and close in March, with winners announced in May. You can sign up here to be notified when the contest returns.

To be eligible, you must be a for-profit business and have the following:

  • A FedEx shipping account number
  • Been in business selling a product for at least six months
  • Fewer than 99 employees
  • A shipping need for your business

The National Association for the Self-Employed (NASE) awards quarterly $4,000 Growth Grants to its members. Business owners can use the money for marketing, advertising, hiring employees, expanding facilities and other business needs.

To apply, you must be a NASE member. A basic annual membership costs $120.

You can apply any time during the year, and the selection committee reviews applications in January, April, July and October.

The Second Service Foundation (formerly known as the StreetShares Foundation) is a nonprofit organization that helps former members of the U.S. military start or grow a small business.

Its Military Entrepreneur Challenge has three awards: first place: $15,000 plus $50,000 in free legal services; second place: $6,000 plus $25,000 in free legal services; and third place: $4,000.

To apply, you must be:

  • A U.S. citizen and at least 21 years old
  • A veteran, reserve or transitioning active duty member of any branch of the U.S. Armed Forces or a spouse or child of a Military Member who died on active duty
  • At least a 51% owner of a business

Applications are currently closed, but check the organization’s Grant Program page to see when applications for the next round open.

The wholesale jewelry supply business Halstead is an annual award for emerging silver jewelry artists. The grand prize is $7,500 plus $1,000 in merchandise. In addition, up to five semi-finalists also receive $250 or $500 to help them promote their business.

You can download the application online, and applications typically must be postmarked by Aug. 1.

Grants for startup businesses

Startup businesses often have unique challenges getting funding because some business loans and grants require applicants to have been in business for six months to a year. Fortunately, several grants are targeted to early-stage companies. Some are open only to specific demographics, so review the eligibility requirements carefully.

WomensNet has several grants for women-owned businesses, including a monthly and annual Amber Grant. The monthly Amber Grant is $10,000, and four finalists receive $1,000. The $10,000 winner each month qualifies for one of two $25,000 year-end awards.

To be considered for the monthly or annual grant, you need to fill out an online application describing your business and what you would do with the money and pay a $15 application fee.

The SoGal Foundation’s Black Founder Startup Grant provides startup capital grants for Black women and Black nonbinary entrepreneurs.

The program offers several $5,000 or $10,000 grants and consulting help on fundraising and other entrepreneurship topics.

To qualify, applicants must:

  • Self-identify as a Black woman or Black nonbinary entrepreneur
  • Have a legally registered business
  • Have a “scalable, high impact solution or idea” and a desire to become a “billion dollar business”
  • Fill out an online application

Applications are accepted throughout the year.

Hello Alice provides information on several different grant programs. You can sign up for a free account to apply for multiple grants, including:

  • $5,000 Small Business Growth Fund Grant
    • Requirements: for-profit business with less than $1 million in gross annual revenue
  • $15,000 Stacy’s Rise Project grant
    • Requirements: For women entrepreneurs in the food and beverage consumer packaged goods space
  • $25,000 NAACP Powershift Entrepreneur Grant
    • Requirements: For Black entrepreneurs
  • $10,000 Alibaba.com Manifest Grants Program
    • Requirements: Registered business based in the U.S. with a new or existing innovative physical product currently on the market or expected to be viable within six months.
  • $10,000 Restaurant Disaster Relief Fund
    • Requirements: For restaurants experiencing hardship due to a state or federally declared natural disaster, independently owned, brick-and-mortar location, three stores or fewer currently operating, revenues of $3 million or less per location in the last 12 months, 50 or fewer employees per store

The Tory Burch Foundation Fellows Program is a one-year fellowship for women business owners. The program includes training, a peer community, a paid-for trip to the Tory Burch offices and $5,000 for business education.

To qualify, you must:

  • Be a woman entrepreneur who owns the largest or equal stake in a for-profit business that is majority owned and controlled by women
  • Be at least 21 years old, proficient in English and a legal resident of the U.S. or its territories

The program also prefers that the business has been in operations for less than five years and generates annual revenues of at least $75,000.

Applications for the fellowship starting in summer 2023 close on Nov. 3, 2022.

The Visa Everywhere Initiative is for fintech startups that deliver innovative payment and commerce solutions for businesses and consumers.

In addition to local and regional prizes, the global finals event awards:

  • $100,000 to an overall winner
  • $20,000 to an audience favorite
  • $20,000 Visa Direct prize
  • $20,000 2nd place prize
  • $10,000 3rd place prize

In the U.S., applications typically close in March, with a regional finals event in August and the global finals event taking place in November.

How to get grants for small businesses

The process for how to apply for small business grants is a lot like how to get a business loan. Remember that every grant will vary, so check the requirements before applying. The following is a general step-by-step guide you can follow to get started.

1. Make sure you meet the program’s requirements.

Each small business grant has different requirements that applicants need to meet to be considered for the grant award. Before applying for a grant, check that you meet the basic program requirements, including location, business size, industry and match requirements, if any. Some may even require that you have a membership to a specific organization before applying.

2. Gather your organizational documents.

Once you know that your business falls into the right category (or categories) to apply for a grant, you’ll want to gather your documents. A business plan laying out why you’re applying for funds and how you plan to use them will most likely be required. You may also need the following:

  • Employer Identification Number (EIN)
  • DUNS number
  • Revenue history
  • Organizational chart, including the number of employees
  • Bank statements
  • Tax returns
  • List of contracts your business holds
  • Location(s) information
  • Contact information

3. Complete the grant application

Lastly, you need to fill out the actual grant application, where you’ll likely spend most of your time. These applications typically require small business owners to answer open-ended questions, and application complexity can vary depending on where you’re applying for a grant.

You might need to explain why you need the funds, your plan for the money if you win, the background of your business or how your business contributes to your community. These questions can be technical and specific depending on the grant you’re applying for, and they’re an opportunity to make sure your application stands out among the competition.

Business grants vs. business loans

The main difference between business grants and business loans is that loans need to be repaid, while grants generally will not. A small business loan needs to be repaid in the agreed-upon time with the agreed-upon interest rates and can require collateral. Loans also usually come from a bank or a specific lender, though some institutions, like the SBA, offer both loans and grants; both types of funding may also have rules about how funds can be used.

While loans and grants have stark differences, they can each benefit your business and might be useful during different times of your business’s life cycle. Grants might help new businesses get on their feet, while business loans are typically for larger amounts and can be helpful for scaling your company. Startup businesses may find it difficult to get a loan without at least several months in operation and consistent revenue.

COVID-19 federal grants

During the COVID-19 pandemic, the SBA offered several grants to help small businesses and entrepreneurs. These grants programs are now closed.

This $10,000 grant was specifically for small businesses and nonprofits that experienced a loss of revenue due to the COVID-19 pandemic. To be eligible, companies must have had 300 or fewer employees, be located in a low-income community (as identified by the Internal Revenue Code) and demonstrated a more than 30% reduction of revenue during the eight weeks beginning on or after March 2, 2020. Smaller businesses with ten or fewer employees and a reduction in revenue of 50% or more were eligible for Supplemental Targeted Advance of $5,000, for a total grant of $15,000.

The RRF provided funding to help restaurants keep their doors open with up to $10 million in grant funding, up to $5 million per location.

The program was available to restaurants, food stands, trucks and carts, caterers, bars, saloons, lounges, taverns, snack bars, bakeries, brewpubs, tasting rooms, taprooms, breweries, wineries, distilleries and inns.

The Shuttered Venue Operators Grant provided emergency assistance grants for venues impacted by the COVID-19 pandemic. Eligible entities included live venue operators or promoters, theatrical producers, live performing arts organizations, museum operators, zoos and aquariums, motion picture theaters and talent representatives. Venue operators were eligible to receive grants equal to 45% of their gross earned revenue in 2019, up to a maximum of $10 million.

Frequently asked questions

You can find small business grants through the federal or state government, nonprofit organizations, private companies and foundations. A few good places to start are the federal grant database Grants.gov and your local Small Business Development Center (SBDC).

The SBA typically doesn’t award grants directly to small business owners. Instead, it works with states and community organizations that promote entrepreneurship and provide small business counseling and training programs. It also offers several types of loans.

Small business grants can be used for a variety of purposes. Some grant programs allow business owners to spend the money however they see fit. Others may place restrictions on the funds and require recipients to document how they used the money, such as purchase equipment, hire employees, invest in research and development or market their business.