Business Grants for Felons

Written by  Katie Ziraldo

Written by  Lindsay VanSomeren

Edited by  Dawn Daniels

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Updated Oct 13, 2025 Content was accurate at the time of publication.

If you’ve been incarcerated, you may face a tougher path to good employment. That’s why people leaving prison are estimated to be 41% more likely to start their own business. If no one will hire you and you’re determined to make it work, you can always hire yourself — but starting a business takes money.

Business grants can be a great way for returning citizens to get started in the business world because they don’t need to be repaid, eligibility isn’t based on creditworthiness and grant recipients can also receive coaching, mentoring and community support.

Private grants

Unless the eligibility criteria says otherwise, formerly incarcerated people are generally eligible for the same small business grants as the general public. However, focusing your efforts on specific business grants for felons may narrow the applicant pool and improve your odds.

NASE Growth Grants

The National Association for the Self-Employed accepts applications each quarter for these grants, which are awarded to people who can show a demonstrable need for the funds in their business plan and grant application.

Membership costs as little as $11.95 for one month, though if you’re on a monthly plan, you’ll need to be a member for at least three months to apply for this grant. In addition to potential Growth Grants of up to $4,000, a NASE membership gives you access to other helpful resources, including business strategists and legal experts that can answer your questions and help your business succeed.

TRANSFORM Business Grant

In TRANSFORM’s own words, it’s an anti-racist and anti-capitalist organization that provides $1,000 microgrants for systematically marginalized entrepreneurs, including people who were formerly incarcerated. 

In addition to these funds, grant recipients get to participate in a year-long mentorship program, where you get to call the shots in terms of who you work with and what support you need. TRANSFORM has a wide range of experts you can benefit from during this timeframe, including branding, coaching and marketing professionals.

Amber Grants

Founded in memory of a young woman who passed away before realizing her entrepreneurship dreams, WomensNet has been giving out Amber Grants since 1998. Funding opportunities are frequent, with the organization awarding over $435,000 throughout the year, although you can only apply once every three months. 

WomensNet chooses its grant winners based on their ability to write a compelling story about their business, including information on growth plans and how the funds would assist them in reaching their goals. With one application, your business will be considered for all of WomensNet’s monthly grants.

LEAP Virtual Entrepreneurship Academy

The Florida-based Ladies Empowerment and Action Program (LEAP) offers an online entrepreneurship program that teaches formerly incarcerated women the ins and outs of planning, launching and following through with managing their own business. 

Participants also get access to a business mentor and the LEAP alumni network, and each class ends in a pitch competition for real funding from investors, plus the opportunity to apply for a $1,000 microloan. 

Note that while the course is free, you may receive funding in the form of a microloan and not a grant — meaning it will need to be paid back. How much funding you get, and the type of funding, will depend on the pitch you make at the end of the course.

Georgetown Pivot Program

In 2018, Washington, D.C.-based Georgetown University launched the Pivot Program as a part of its broader Prisons & Justice Initiative. Not for the faint of heart, the program requires a full-time, in-person commitment for a year, but at the end you’ll receive a college certificate in business and entrepreneurship. 

The program is split up into a few different parts, starting with coursework, followed by a three-month internship and culminating in a choice between two additional training tracks: employment or business incubation. If you’re choosing to start your own business, the Pivot Program provides workspace, business coaching, legal support and other resources.

Government grants

If you’re looking for direct funding, private grants are generally your best option. The federal government doesn’t typically offer small business grants directly to individuals — felons or otherwise. But while many small business owners won’t qualify for federal grants directly, these grants may be awarded to organizations that turn around and offer their own funding for entrepreneurs. 

In this sense, reentering citizens could potentially be able to take advantage of federal grant funding. To do so, you’ll need to find out which organizations have received federal grant money on sites like Grants.gov. Then, you’ll need to apply with any listed groups that offer financial assistance for small business owners. 

Here are a few examples of federal grant programs that may indirectly fund entrepreneurs with a criminal record:

Rural Innovation Stronger Economy Grants (RISE)

The USDA offers this annual grant for entities in rural areas to build programs and facilities meant to train workers and encourage entrepreneurship. You can find out which organizations have received RISE grant funding by reviewing the public information available on the USDA’s rural data website. 

To see where funding went, you may need to download a CSV file, which you can then search in a program like Excel or Google Sheets for grant programs to find out if you’re eligible for any sort of training or assistance.

Second Chance Act Community-Based Reentry Program Grants

The Department of Justice offers this annual grant to state and local government agencies that support formerly incarcerated people in reentering society. In 2025, it’s estimated that this grant will give over $14 million to 20 different organizations. 

The National Reentry Resource Center maintains a database of past grant winners, which you can use to find out which organizations have received federal funding to establish and expand reentry programs. Follow up with these groups to see if they offer any potential resources or funding for your business.

State and local grants

Small business grants for people with a criminal record are also offered at state and local levels. These grants may be structured similarly to federal business grants (with funding going to organizations that support you, rather than you directly), or they may be targeted toward individuals.

Local Small Business Development Centers

The U.S. Small Business Administration (SBA) has over 1,000 Small Business Development Centers (SBDCs) spread across the country, with centers located in every state. 

SBDCs offer access to a team of support staff designed to help local entrepreneurs start, manage and grow their small businesses. This includes training and workshops on business planning, financial management and more. Your local SBDC is an excellent resource to help you find business grants.

State and Local Government Economic Departments

Many state and local governments have economic development offices that focus on assisting small business owners. Your local office can help you find information on potential funding opportunities, including any grants you might be eligible for. Note that while most state governments have economic development departments, the name of the department can vary. 

For example, entrepreneurs in Michigan can access business resources and support through the Michigan Economic Development Corporation, while entrepreneurs in California can find similar resources through the Governor’s Office of Business and Economic Development. You can use the economic development directory to learn more about the agencies that offer business support in your area.

Entrepreneurship programs

While entrepreneurship programs don’t provide direct funding, they offer valuable skill development courses, mentorship and other valuable resources. Some organizations even work with individuals while incarcerated, preparing them for entrepreneurship after being released.

Noteworthy entrepreneurship programs that target inmates and ex-felons include:

Other financial resources for formerly incarcerated people

In addition to grants, former inmates can secure business funding through angel investors, small business loans and crowdfunding. These financing options are best suited for entrepreneurs who are willing to take on debt or give up a portion of their business ownership.

Angel investors for felons

Angel investors are typically high-net-worth individuals who provide financial backing to new businesses. This is a type of equity financing, meaning that in exchange for investing their own money, angel investors typically receive company shares.

Angel investors are most likely to invest in businesses with the potential for high returns, but as individual investors, some may be less profit-motivated than commercial lenders — and they may genuinely want to offer their support in helping startups achieve liftoff. You can look for potential angel investors on websites like AngelList or the Angel Capital Association.

Business loans for felons

A previous felony arrest or conviction won’t automatically disqualify you from getting a business loan.

With capped interest rates, SBA microloans can be particularly helpful for startups that are too new to qualify for financing elsewhere. Business owners with a criminal history are eligible for SBA loans, though individuals who are currently incarcerated or have previously defrauded the government are not. 

If you have poor or no credit, it can be difficult to qualify for business loans with traditional lenders. Alternative lenders have more lenient criteria, but it can still be challenging to meet for some borrowers. Fortunately, microloans might be easier to obtain. Offered by nonprofit organizations and government agencies, microloans generally offer loan amounts up to $50,000.

Crowdfunding platforms

Crowdfunding platforms allow you to raise funds from friends, family and the general public. Since there are no minimum time-in-business or credit score requirements, crowdfunding can be a viable alternative for those who don’t qualify for traditional financing.

This financing option has relatively low risk, as you typically aren’t required to repay any funds you raise — even if your startup goes belly up. However, you may need to provide incentives to get people to contribute their funds. For example, a food truck startup might offer a free lunch voucher, or a clothing company may give away free t-shirts.

It’s also important to note that crowdfunding involves collecting contributions from a large number of people, and marketing your campaign can be time consuming. In some cases, you may have to return the donated funds if you don’t reach your fundraising goal by the deadline.

How a felony conviction can affect starting a business

Felony convictions can make starting a business challenging, but they shouldn’t prevent you from achieving your dream of entrepreneurship. The impact of a felony depends on several factors, including the type of business you’re opening, where you’re opening it and what assistance — financial or otherwise — you might need to get your business off the ground.

Some people convicted of felonies and misdemeanors report being discriminated against when seeking employment or applying for small business funding, and that’s a potential problem you should be prepared for. You could also be banned from working in certain industries, such as medicine, law and finance.

However, there are many business grants and assistance programs for formerly incarcerated individuals — you’ll just need to carefully select your business concept and find the right group of people to support you.