02/ 10/ 2005
by Tamara E. Holmes
It's a fact of small business life. It takes money to make money.
Luckily for small-business owners, you don't have to have plenty of money in the bank to start a business or to expand. Rather, there are small-business grants designed specifically to help small-business owners get an infusion of cash in order to get ahead.
Unlike loans, grants do not have to be repaid. They are sums of money that are given to entrepreneurs who fit certain criteria to help them achieve their financial goals.
Generally, in order to secure a grant, you'll need to fill out an application or a proposal that explains what you would do with the money and how it would help your business to grow. Organizations that dispel grant money don't want to throw their money away, so they tend to look for sound business plans. If you haven't taken the time to create a business plan that shines, you'll want to do that before you start looking for grants. You may also want to research the art of grant proposal writing so you can better get your business idea across to the organization that is funding the grant. Applying for grants can be a competitive process since there are often many different groups and organizations seeking the same funds.
Once you're satisfied that you understand the proposal and application process, you can start looking for grants. While there is no one place that lists every grant available, you can increase your odds of finding a grant by knowing what types of organizations tend to give them out.
One of the first places to check when looking for a grant is your own state. Economic development agencies often want small-business owners to succeed because that in turn helps the state's economy. Try your local Chamber of Commerce or other business assistance agencies first. They can probably direct you to resources available in your community.
The federal government does not offer grants to small businesses directly. However, the government does provide money to organizations that provide grants to small businesses.
The best way to find some of these organizations and grant opportunities is to go to http://www.grants.gov. The Web site is a one-stop shop for more than 900 grants that have are available thanks to financial support from the federal government.
Through the site, you can find grants based on industry. So if you have a health-care company, for example, you would look for grants related to that area. You might find some that will cover research in your field or you might find a grant that will cover expansion of your business to a different area of the country. Once you find a grant or grants that meet your criteria, you can even apply for them online via the site.
Private funding organizations also supply grants. These charitable organizations tend to be in favor of a particular cause, and if your business in any way furthers such a cause, the organizations will provide funding to help you.
For example, if your small business sells environmentally-friendly products, you might try searching for environmental organizations and foundations to see if any are offering grants to businesses that stand for the same principles that they do.
Likewise, industry associations might offer grants to small companies in that field. So if your small business is a technology company, for example, you'll want to check with all of the technology industry groups to find out whether there is any money allotted for small businesses that are just starting out.
If you're a woman or a minority, you should check with organizations that are dedicated to business development within your community. Women business owners, for example, might find funds by checking with the Women's Business Center (http://www.onlinewbc.gov/grants.html).
While every small business is not guaranteed that there's a grant available to help further its financial goals, there are enough resources available to make it worthwhile to do a little research before taking out a loan.
After all, the money you save will be your business' own.
