Small Business Grants
It’s no secret that small businesses are one of the first ones to suffer when something like a global pandemic hits.
As a small business owner, you are likely to need money to grow your business – or stay afloat – during the rough patches.
Whether you are looking for grants to help you get through the rest of the COVID-19 pandemic or are just looking for small business grants to help you reach your goals, you’ve come to the right place.
In this article we are going to cover the best small business grants of 2021 so that you can get relief for your small business or take your small business to the next level.
Here are the Best Small Business Grants of 2021:
We will go more into detail of each of these small business grants later in this post, but first, let’s define a Business Grant so we can better understand what they mean.
What is a Business Grant?
In the easiest terms possible, a grant is free money that is given to a business owner, business, nonprofit, or corporation from federal, state, county, or local governments, or private businesses or corporations.
A Business or Federal Grant, or Government grant does not require repayment of any kind and are usually provided by another company, nonprofit, or government agency.
Grants are formed to target businesses based on a variety of eligibility requirements such as; women-owned businesses, minority owned businesses, veteran-owned businesses, types of nonprofits, and so on.
Other grants are created to provide relief for small businesses of all types during recessions, or in this case, a global pandemic like COVID-19.
During a time like this when so many small businesses are struggling, these grants can provide the much-needed funding opportunity to help keep your businesses afloat.
In this post we’ve compiled a group of small business grants opportunities that have broader grant requirements.
This means that more types of businesses qualify and your chances of being approved for funding are higher than more specific grant types.
While this is great because more types of businesses can apply, it also means there is going to be more competition for the grant funds.
Before applying for a more general business grant, try searching for niche specific grants for your industry and see if your chances are even better there.
Now let’s take a dive into some small business grants!
COVID-19 Relief Grants for Small Businesses
As mentioned above, it is no secret that this global pandemic has left many small businesses hurting all across the country.
The Federal Government recognizes this and has created two main programs that may provide financial help and in some cases, may not need to be paid back.
While this technically is a loan, it includes a $10,000 grant for eligible businesses.
While you can qualify for a loan amount greater than the $10,000, if you meet the following eligibility criteria, you may qualify for a $10,000 grant:
- Be located in a low-income community
- Suffered an economic loss greater than 30%
- Employ fewer than 300 employees
The PPP loan program first came out in 2020 and the funds went quickly so the Federal Government released a second round of funds.
The PPP loan program is also technically not a grant, if you spend the funds on approved expenses during a specific time frame, the entire PPP loan may be forgiven.
Keep in mind that you will need to keep and provide detailed records of how the funds were spent and make sure they are only spent on approved expenses.
The Shuttered Venue Operator (SVO) Grant program provides $15 billion in grants to certain businesses impacted by COVID-19, including:
- Live venue operators or promoters
- Theatrical producers
- Live performing arts organization operators
- Relevant museum operators, zoos and aquariums who meet specific criteria
- Motion picture theater operators, or
- Talent representatives
This grant opportunity is administered by the SBA to applicants who have been in business by February 29, 2020.
They facilitate many grants and other local funding opportunities, including the Small Business Relief Grant targeting businesses in rural areas.
The LISC Small Business Relief Grant provides grants of $5,000 – $20,000 to small businesses located in rural communities with populations of less than 50,000 people.
Grant funds may be used for:
- Operational costs (including rent and utilities)
- Vendor debt
This is a small business grant program.
The Barstool Fund is a newer COVID-19 relief grant sponsored by Barstool Sports.
The fund has an ongoing crowdfunding campaign to raise funds for eligible businesses that apply.
There is no set grant amount, but recent businesses have been receiving an average of $9,000.
Crowdfunding company GoFundMe has partnered with partners to provide a COVID-19 relief fund for small businesses.
Your business may receive a matching grant when you raise $500 through your own GoFundMe campaign, as long as you can verify that your business has been negatively impacted by the coronavirus.
Funds must be used to pay business expenses or care for employees.
Ball, maker of canning products, is offering small businesses who have made significant contributions to their communities during the COVID-19 pandemic awards of up to $10,000.
To enter, you must use Ball brand canning products in your business.
If you are grant recipient in the restaurant busines or any type of business that uses Ball brand canning products, you can apply for this small business grant program.
Private Small Business Grants
The following grants are Private and they are not necessarily specified to provide relieve from COVID-19.
This grant is good for existing businesses and each year since 2013, FedEx has offered $25,000 grants to small businesses.
The application is only open for a short period (1 month) and as the applicant you will need to capture your businesses story on video.
If your business is growing and you need some extra funds to take it to the next level, this is a great grant.
NASE grants are worth up to $4,000 and can be used for all types of activities, like purchasing new equipment, hiring help, and creating promotional material.
This grant is specifically open for veterans, active-duty members, or the spouse of a military veteran or active duty member.
Applicants can receive up to $5,000 and will be judged based on their business idea, their expected use of funds, product-market fit, team, and the influence the business will have on the veteran or military community.
Another grant that is great for existing businessesis the Nav Grant.
Each quarter, Nav offers a $10,000 small business grant to help them solve a business problem or take their business to the next level.
Caleb Brown Urban Entrepreneur’s Community Grant
The Caleb Brown Venture Capital and Consulting Project hosts a $1,000 grant aimed at promoting and nurturing young urban entrepreneurs with vision who plan to rebuild local blocks, neighborhoods, and communities “by providing training and jobs to the next generation.”
The grant is open to startups and young businesses in urban areas.
This contest is run every month-submit your application by the 15th to enter.
This grant is great if you are a sole proprietor or an employee or independent contractor who is trying to start a startup business.
This is a pretty specific grant but if you are Jewelry Startup this is a great grant to look into.
Submit your portfolio and business plan to Halstead for its annual jewelry grant award of $7,500.
In addition to funds, Halstead aims to help jewelry artists develop their business, fine-tune their plan, and hit their goals.
Federal Small Business Grants
The SBIR grant program is for entrepreneurs focused on innovations in technology that have the potential for commercialization.
This grant is ideal for Technology Companies.
Focus areas from the past include clean and safe water, homeland security, land revitalization, green construction, advancement of health care, and more.
If you are an energy-focused business, the STTR program aims to expand funding for innovative research and development leveraging existing technology.
What makes this program unique from the SBIR program is that small businesses get the opportunity to formally collaborate with research institutions throughout the program.
Department of Defense Grants
The DoD offers grants to small businesses through the STTR program and a number of other initiatives, like the Defense Enterprise Science Initiative.
The Office of Naval Research, the Air Force Office, and the U.S. Army Research Institute are all looking for research and development of technology that will help them reach their goals.
This is great for R&D businesses.
Department of Energy Grant
The DOE offers grants through the SBIR and STTR programs for innovative research and development leveraging technology developed by a university or a DOE National Lab.
Check here for its current grant openings.
National Institute of Health (NIH) Grants
NIH is a federal agency within the Department of Health and Human Services (HHS).
It offers business grants to small businesses developing and researching biomedical technology.
It is currently funding opportunities related to COVID-19 research.
Department of Justice Grants
The DOJ allocates grant funding to projects that support law enforcement, public safety activities, programs to improve the criminal justice system, and more.
Here’s an overview of the agencies within the DOJ that provide grants.
Department of the Interior Grants
The DOI offers small business grants through several departments, including the U.S. Fish and Wildlife Services, Indian Affairs, National Park Service, and Native American Graves Protection and Repatriation Act. Find other DOI grant opportunities on Grants.gov .
USDA Rural Development Business Grants
The Department of Agriculture offers both loans and grants to support businesses in rural areas to create quality jobs.
It funds community projects such as the development of housing, community facilities, and other services.
National Institute of Food and Agriculture (NIFA) Grants
The NIFA is a federal agency within the USDA with a focus on leadership and funding programs.
It offers grants throughout the year, which come with support and guidance.
Be mindful that many of its grants are offered to nonprofits or larger businesses.
Small Business Grants for Women-Owned Businesses
Eileen Fisher Grant Program
Eileen Fisher is a clothing shop for women whose founder has a personal passion for helping women entrepreneurs.
All grants exceed $10,000 and are awarded to up to 10 applicants each year.
Businesses must be in operation for a minimum of three years and meet other various requirements.
The Amber Grant Program
The Amber Grant is a $10,000 cash grant awarded to qualifying female entrepreneurs each month.
At the end of the year, monthly grant recipients will have the opportunity to win an additional $25,000 grant.
How to Search for Grants for a Small Business
As with anything you are trying to learn more about, you can always do a quick Google search to see what information pops up.
You can always search for grants on Google but there are so many options out there it can be hard to narrow down the best prospects.
In this next section we are going to list a few resources that can help you find the right grants for your business.
Grants.gov is the federal government agency’s landing page for all federal government grants across agencies.
It’s a great resource for finding grant opportunities, but small businesses may be disappointed to find that many of the grants are closed to them.
The site mainly includes grants for larger organizations like school systems, local governments, individuals, and nonprofits as well.
Federal grants available to small businesses tend to have specific requirements when it comes to business size.
You can read more about how the federal government determines which businesses qualify as “small” businesses in this article .
Receiving a government-funded business grant is tricky, so here are some general guidelines and requirements that the federal government uses to determine who they grant money to:
- Grants are not for “starting” a business
- Grant money is not to be used to pay off debt or cover general operating expenses
- State and local grants that are provided by the federal government may be awarded to organizations that assist with economic development.
GrantWatch is another database of grants of every kind, though it’s a subscription-based service you will need to pay for.
The site has a wide variety of grants offered by federal, state, and local governments, as well as small business grant, foundations and corporations. The site is constantly being updated, and grants that have closed are archived.
You can filter the more than 25,000 grants by category to narrow down the ones targeting small businesses like yours.
Small Business Development Centers
Small Business Development Centers are a business owner’s best friend.
Local, regional, state, and national offices mentor small business owners and help them understand business financing options, craft marketing strategies, and connect to other local business owners (and much more – these guys do it all).
SCORE is a nonprofit organization backed by the Small Business Administration that promotes free tools and mentorship for American small business owners.
Like SBDCs, SCORE is a free resource for entrepreneurs looking for help or expertise and they have many local experts that you can connect with.
A SCORE mentor may help you identify local grant opportunities, or review your pitch to help you make it as compelling as possible.
Applying for a Small Business Grant – What You Need
Applying for grants is almost like applying for jobs.
Instead of filling out each individual grant application, we suggest creating a “resume” for your business.
The resume should answer some common questions that gran-givers ask.
You can then add or remove items from your resume as needed for each individual grant application.
Here are some of the common questions/information you may need to provide when applying for a business grant:
- How long your business has been active
- Number of employees
- Monthly or annual revenue
- How the business plans on using the grant funds
- Your business’s “elevator pitch”
- Your Employer Identification Number (EIN)
- Your social media handles (LinkedIn, Facebook, Twitter, Instagram, etc.)
- A photo of you and if applicable, your partners, office, etc. Tip: Professional photos can go a long way, especially for companies looking to use your image on their site when announcing awards.
- A business plan. You should already have one, but if you don’t, talking to an SBDC adviser or your accountant can help you figure out the numbers, projections, and stats that reflect the current health of your business and where you can go down the road.
Business Grants vs. Business Loans
Business grants and business loans are both very different things.
A grant does not require repayment while a small business loan does.
Grants (free money) can be very difficult to get so we always tell business owners to also look at Business Loan options.
Here are some key things to know about grants and loans:
- Grants are considered income for tax purposes and are therefore taxable. To plan for this, you should set a portion of your grant money aside from the beginning so that you have it ready come tax time.
- Loans are not taxed but they do incur interest. Even a low-interest loan adds up, so you will need to keep that in mind. Make sure that you do not take a loan out that has a high payment due to the principal + interest payments due each month. Depending on your credit score, cash flow, and years in business, your APR can range anywhere from 2.5% – 150%.
- Loans help you build business credit, a grant won’t. Because a loan needs to be paid back, it will show up on your credit report. When you pay your loan payments on-time each month, you are going to also build up your credit score. It takes credit to build credit, so if your business is new and needs some credit history – loans can help.
- If you can prove to a business lender that you’re credit-worthy and your business financials are sound, you’re likely to get approved for a business loan, whether or not another business in the community applies. Grants are much more competitive and you have to compete with hundreds or maybe even thousands of other businesses hoping to get the same pot of money.
- If you default on a loan or miss a few payments, this can have a serious impact on your business credit. If you default on the loan you can risk repossessed equipment, a business lien or UCC filing, and a damaged personal and business credit score.
Small Business Grants are a great way to help your business get through a rough time like a pandemic or help your business meet certain goals.
As you saw, there are so many grant options depending on your need, type of business, and so on.
As mentioned, grants are extremely competitive and require that you put in some work through the application process.
The more grants you apply for, the greater your chance of getting approved for one.
If you do score a grant, make sure to set a portion of it aside for your end of year tax payment, as grants are considered taxable income.
Loans on the other hand are also a great option if your business is growing and you can show some sort of steady cash flow.
Just keep in mind that loans have interest and make sure you shop around for the best interest rates.
Loans can help you build credit which is a win-win for your business.
We always recommend businesses try their hand at grants because free money that helps grow your business is amazing!
If all else fails, there are some great loan options to look into that might be a great way to take your business to the next level.