Last year, the federal government allocated more than $500 billion to grants, with $26 billion of those federal grant funds going directly to for-profit businesses. In addition, there are numerous grants that have been made available at the state and municipal levels to fund new equipment, employee trainings, facility upgrades, and market expansions for small businesses. Nearly every state in the country has programs in place that offer varying degrees of financial assistance to businesses. Cities, counties, and other local government organizations also offer grant programs.
Programs such as the Small Business Technology Transfer and Small Business Innovation Research fund a range of business activities related to research and development. For those small businesses that fall outside the energy, technology, and scientific fields, grant monies are available that focus on economic development and business expansion. While grants are different from loans in that they don’t have to be paid back, they are typically awarded for specific purposes meant to further national or local economic interests. In addition, they usually come with strict requirements and accountability measures.
Some available grant programs have been structured as competitions. An example of this is New York City’s Industrial Growth Initiative, a program that provides growth workshops and a business education series, and finishes with a business plan competition where participants use the knowledge they have gained to create expansion plans to guide their next stage of growth.
There is a lot of incentive for municipal agencies in particular to provide grants. As the president of New York’s Economic Development Corporation Kyle Kimball explains, those businesses that benefit from grant programs create jobs and provide an important source of tax revenue, thereby repaying the city’s investment several times over.
As many small business success stories have demonstrated, even a modest grant can really help take a business to the next level. The money can be used to capitalize on a new business opportunity, for research and product development, or to pay for supplies, marketing campaigns, or similar initiatives. The best place for small business owners to start looking for government grants is Grants.gov, which provides links to more than 1,000 federal programs currently available.
Cortese, Amy. “Government Grants May Help Ease Business Challenges.” New York Times. 8/13/14.