How Business Grants Can Help Fund Your Startup

  1. The U.S. Small Business Administration can help small business owners and entrepreneurs find local assistance for business grants.
  2. Unlike business loans, you don’t have to repay small business grants. Simply apply, qualify, and there you have it – free money to help your business grow.
  3. The SBA helps women entrepreneurs on their journey toward owning successful businesses and remaining competitive in the marketplace. 

Finding enough money to launch and grow your business can be difficult. While there are lots of funding options entrepreneurs can utilize, one they don’t often consider is applying for a business grant. 

What is a business grant?

A business grant is an investment of capital from private and public sources that help small businesses develop. These opportunities are generally based on geographical location, income, business type or other qualifications aimed to support underrepresented groups, such as women, minorities and veterans. 

Often, grant funding is awarded through a small business contest, in which eligible small business owners apply to be potentially selected as a recipient. Many grants for small businesses are open to companies in the science, technology or medical fields. Some business grants provide training and technical assistance to low-income entrepreneurs, but they generally do not provide grant money. 

Local and state governments also provide business grants for investments in key initiatives they are promoting, such as investing in enterprise zones or supporting certain types of businesses. Sometimes, these grants are in the form of a tax credit.


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Do you have to pay back business grants?

Unlike business loans, you don’t have to repay small business grants. Simply apply, qualify, and there you have it – free money for your business. Small Business Administration (SBA) loans must be repaid. The SBA itself doesn’t provide grants, but you can acquire grants with their assistance through their website. 

How to apply for a business grant

Most grants have very specific rules about who can apply, what types of companies and business innovations are eligible and on what timeline. The deadlines and processes vary dramatically by grant program. Business owners need to determine which grants they want to pursue and then write the grant proposal. Here are three steps to applying for a business grant: 

  1. Find a grant. Confirm your eligibility requirements for business grants using Read and understand the requirements, and find the federal grants that are most relevant to you and your business.  
  1. Write a grant proposal. This step requires you to gather a substantial amount of information, in addition to having a completed business plan. Focus on expanding what need your business intends to fulfill, what problem you are proposing a solution for and how you plan to track your impact. 
  1. Prepare and submit forms. Register with to complete and submit your grant application. You’ll receive a tracking number to monitor the status of your application. 

Types of business grants that are available

Are you wondering which government grants are available for small businesses? We’re here to help you – we’ve gathered a list of the top small business grants of 2020. [For more information on small business funding alternatives, read .] 

Federal grants for small businesses

The federal government typically only provides grants to nonprofits and educational institutions. However, some local governments may offer grants through departments such as economic redevelopment. has documents that detail the full list of eligibility requirements, terms and conditions for SBA grants.  

Here are the top federal grants for small businesses. 

Small Business Innovation Research and Small Business Technology Transfer programs (SBIR, STTR) 

The SBIR and STTR are competitive grant programs that encourage small businesses to engage in federal research and development, particularly with technological innovation and scientific research. 

The grant programs help connect small businesses, universities and research centers with federal grants. To qualify, you must be a for-profit business with 500 or fewer employees. Nonprofits (those with a 501(c)(3) designation by the IRS) aren’t eligible for these programs. 

The SBIR and STTR grant programs are structured into three phases. SBIR Phase I awards normally don’t exceed $150,000, and Phase II awards typically don’t exceed $1 million. Phase III is designed for small businesses to pursue commercialization objectives resulting from Phase I and Phase II. The SBIR program doesn’t fund Phase III. 

As of November 2019, agencies can issue Phase I awards up to $256,580 and Phase II awards up to $1,710,531. 

National Institutes of Health

The National Institutes of Health, a subset of the Department of Health and Human Services, offers grants for small businesses researching and developing biomedical technologies. 

Department of Energy

The Office of Science, a subset of the Department of Energy (DOE), participates in the SBIR and STTR grant programs, and offers numerous funding opportunities for more than 60 technical research topics and 250 subtopics, spanning areas that support energy production, energy use, fundamental energy sciences, environmental management, and defense nuclear nonproliferation. 

Check out the DOE’s open funding opportunity announcements and its open lab announcements. 

National Institute of Food and Agriculture

The National Institute of Food and Agriculture (NIFA), a branch of the Department of Agriculture, supports research, educational and extension efforts in several rural areas related to agricultural and behavioral sciences. These fields include food science, animal life, farming and ranching, business and economics, plant life, and other fields. 

The NIFAs grants consist of four phases: 

  1. Preaward. This phase begins with the announcement of funding opportunities for grants, and involves the preparation, submission and review of proposals related to those announcements. 
  1. Award. This phase involves making funding decisions and notifying awardees of their selection for a grant. 
  1. Post-award. This phase consists of setting up accounts in the financial payment system, and monitoring awardees for compliance with applicable laws, regulations, policies and submission of required reports. 
  1. Closeout. The closeout phase involves the submission, review, and approval of all final reports as required by specific program policies and regulations. 

National Institute of Standards and Technology

The National Institute of Standards and Technology, a nonregulatory agency of the Department of Commerce, gives small business grants to startups researching and developing technology under topics like advanced communications, artificial intelligence, bioscience, nanotechnology and neutron research. 

Environmental Protection Agency (EPA)

The EPA awards more than $4 billion in funding annually for grants and other assistance agreements. The EPA aims to help small nonprofits and even large state governments achieve their environmental goals. 

In November 2019, the EPA announced $2.7 million in funding to nine small businesses to further develop and commercialize innovative technologies. The contracts are funded through the SBIR program, and the EPA is awarding Phase II contracts to these nine businesses of up to $300,000 each.  

You can find current EPA funding opportunities by searching 

Department of Transportation

The Volpe Center, or the Department of Transportation’s (DOT) systems center, serves as a federal resource that accepts solicitations for financial aid. Participating in the SBIR program, Volpe recently introduced the DOT SBIR Fiscal Year 2020 Solicitation. 

The program will include: 

  1. Presolicitation interchange. Small businesses can review the technical topics and submit clarifying questions to topic authors during this time. 
  1. Streamlined solicitation. DOT teams will evaluate and narrow down the finalists to be considered for awards. 
  1. Pitch day. DOT will implement an in-person Pitch Day event for SBIR finalists to take place at DOT headquarters. This event allows the DOT evaluation team to hear a 15-minute pitch from each of the finalists. 

Check out the presolicitation instructions and full descriptions of DOTs proposed Fiscal Year 2020 Phase I solicitation and the Volpe Center’s new and past solicitation activities before applying. 

State and local grants for small businesses

Many state-level grants for small businesses are focused on your state’s social and economic affairs. You can find state business grants by checking your state’s department of commerce website. Here are some of the most popular state government grants. 

Arkansas Economic Development Commission (AEDC)

The AEDC offers many job-creation incentives and business grants for small businesses in Arkansas. For example, ArkPlus is a state income tax credit program that provides tax credits of 10% of the total investment in a new location or expansion project. 

The AEDC also offers infrastructure grants, which share the cost of project infrastructure needs by committing grants from state and federal infrastructure funds. The amount of money committed depends on several factors, including strength of the company, jobs, average wage and project investment. 

Illinois Recycling Expansion and Modernization (IREM) Program

The IREM program awards grants to Illinois small businesses to achieve recycling market expansion and waste reduction goals. Any government organization, college, for-profit or nonprofit business in Illinois is eligible for funding. 

Grant applications are accepted yearly, according to the state fiscal year. This business grant offers a maximum funding amount of $150,000 for demonstration service and $250,000 for implementation service. 

New York City Commute Enhancement (NYCCE) Grant

The NYCCE grant awards up to $10,000 towards city commuting. If you’re a small business with transportation issues in New York, this grant would be of great use. 

Small Business Development Centers

The SBA can help small business owners and entrepreneurs find local assistance for business grants. These development centers are associated with local colleges and universities, and many can connect business owners with networking and financing opportunities.

Corporate grants for small businesses

Corporate grants are offered by numerous organizations throughout the U.S. These grants help spread goodwill in the community and polish a corporation’s public image. While many nonprofits may overlook corporate philanthropy as a means to raise capital, many startups will likely jump at the opportunity. 

The Halstead Grant

The Halstead Grant is a yearly award for emerging jewelry artists. Applicants must answer 15 business questions and submit a design portfolio. The money awarded to the winners is designed to help entrepreneurs jumpstart their small businesses. The grand prize is $7,500 in cash. The deadline to apply for this grant is August 1, 2020. 

Comcast Innovation Fund

Comcast hosts a small business grant contest designed specifically for business owners who are developing the best open-source software. To apply, each applicant must create a Comcast Innovation Fund account, select a grant and submit a CV. Applicants must also describe their project or research and what it will accomplish. Additionally, details of how the applicant will use the proposed grant are required. The innovation fund is now accepting applications for the 2020 grant year. 

National Association for the Self-Employed (NASE)

NASE members can apply for Growth Grants worth up to $4,000. This grant money can be used for equipment, marketing materials, website creation or hiring part-time employees. To be eligible, Growth Grant applicants must be a member in good standing three months prior to applying. Additionally, a resume and a thorough business plan are required. 

FedEx Small Business Grant Contest

FedEx hosts a small business grant contest that awards 12 small business owners money and insight from FedEx experts to help them grow their companies. This grant contest is open to U.S.-based for-profit small businesses that have less than 99 employees and have been selling a product or service for less than six months from the start of the contest. 

The amount of grant money awarded changes every year. However, for 2020, prize packages include: 

  1. Grand prize. One winner of $50,000, plus $7,500 in FedEx Office print and business services. 
  1. Silver prize. One winner of $30,000, plus $5,000 in FedEx Office print and business services. 
  1. Bronze prize. Ten winners of $15,000, plus $1,000 in FedEx Office print and business services. 

This year’s small business grant contest opened January 28, 2020. Entries are due March 2, 2020. 

Grants for women-owned businesses

The SBA helps women entrepreneurs on their journey toward owning successful businesses and remaining competitive in the marketplace. 

The Office of Women’s Business Ownership (OWBO) provides women entrepreneurs with programs designed to help with business training, federal contracts, and access to credit and capital. The OWBO oversees Women’s Business Centers, which focuses on leveling the playing field for women-owned businesses that face various business struggles. 

The Girlboss Foundation

The current application cycle is open from October 21, 2019, to February 21, 2020. The winners will be announced on April 6, 2020. The 2021 application cycle will begin on June 1, 2020. 

Grants and training opportunities for minority-owned businesses

The Minority Business Development Agency (MBDA), a branch of the U.S. Department of Commerce and the National Association of Investment Companies (NAIC), is the largest grant portal for minority-owned small businesses seeking grant money and other financial opportunities. 

The MBDA has awarded NAIC a $1.4 million grant to support a project that will facilitate the aggregation and deployment of nearly $1 billion in growth capital into minority-owned businesses. 

For counseling and more information on financing a minority-owned business, check out a local Minority Business Center. 

Operation Hope Small Business Development Program

Operation Hope is a small business development initiative designed to provide minority-owned businesses with the necessary financial services to thrive in the marketplace. The 12-week Entrepreneurship Training Program is a curriculum focused on empowering new entrepreneurs the skills required to handle small business ownership. 

8(a) Business Development Program

The 8(a) program helps minority-owned businesses and other small businesses owned by economically disadvantaged people compete for government contracts. The program can also help minorities form joint ventures with established businesses through the SBA’s mentor-protégé program. 

To participate in the 8(a) business development program, you must be certified, and to become certified, you can use the website and create a profile at If accepted into the program, your certification will last for a maximum of nine years. However, you’ll need to complete annual reviews to maintain good standing in the program. 

Grants and training opportunities for veteran-owned businesses

The SBA offers support for veteran-owned businesses looking for funding programs, training and federal contracting opportunities. 

The Office of Veterans Business Development (OVBD) is specifically devoted to veteran entrepreneurship, service-disabled veterans, active-duty service members, transitioning service members and their dependents or survivors. 

Veterans Business Fund (VBF)

The VBF is a nonprofit that was created because of the high unemployment rates among veterans. Many veterans can become successful small business owners but lack access to startup capital or don’t qualify for a small business loan. 

Currently, no applications are being accepted. (VBF will accept applications once its fundraising is complete.) Once the VBF is accepting applications again, the only applications that will be accepted will be from veterans seeking to fund a new small business but who have been unsuccessful in securing financing. 

Boots to Business

Boots to Business (B2B) is an education and training program for veteran entrepreneurs offered by the SBA. Active-duty service members, veterans of all eras and spouses are eligible to participate. 

Participants are provided entrepreneurial skills, knowledge and the resources needed to launch a small business. A two-day “Introduction to Entrepreneurship” course is managed by SBA experts and introduces business ownership to transitioning veterans through key business steps, such as raising startup capital and writing a business plan. Check out the upcoming B2B course schedule.

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