Unlike a small business loan, a grant must never be repaid. And this is what makes it so useful and convenient for a start-up business as well as for developing companies. Most grants have very specific requirements as to how you can spend the funds, but first you need to know how to get free grant money.
The eligibility requirements
In order to be approved for a small business government grant, you must be a citizen of 18 years and be eligible to qualify based on the conditions of the specific grant you are applying for. Most small businesses are eligible for some type of financing, you just need to find the right one.
The application process for small business grants involves a lot of paperwork. After finding the program that you will be able to apply for, you can submit a grant application. It is useful to note that there is no limit to the number of grants you can choose, so if one does not work in your favor, you can freely re-apply to others. After applying, there is a period of waiting while the commission reviews your application and it can take a few weeks, but eventually they will come back with an answer and let you know if you qualify for the grant or not.
An application & a business plan
You should look for one of many hundred programs available to find the one that fits your needs and requirements. Once you find the option that fits your business, then you must prepare a business plan, because it is sent after an application. A business plan takes more than just writing a short letter, it must be detailed, thorough and specific. The business owner should clearly mention the areas where grant money will be invested.
Choosing the right grant
Because there are a number of government agencies and private grant programs that provide qualified candidates with money they need, the terms of each individual program differ slightly. Some will allow you to spend the money you receive for the initial planning, to improve employees’ skills, purchase real estate, office furniture, or new hardware. Others may have stricter guidelines and should not be used to hire employees, but for development of new products or services, for example.
Like all government subsidies, grants available for small business owners and their companies need a delicate balance between the end of the paper work to your satisfaction and by supplementing the point where the various agencies are ready to release funds. The company’s way of development, goals and even location could be a deciding factor for sanctioning of funds. Thus, the government starts the process of business decentralization to stop migration to the cities. So, more and more small business grants are extended to those who own a business in rural areas. Also, since it helps to raise the living standards of the rural population, funders and grant providers are more willing to approve such requests.
How will you spend the grant money?
Gaining more information on how to get free grant money, you will understand that often they have to be spent on improving one or several aspects of the community. The most popular business ideas that can get support from the government are health and education, but also the environmental issues and animal care. For example, an area that has no running water welcomes people to viable projects and these people can count on the support of the government.
Some industry sectors are more likely to receive support through grants for small businesses than others. These include specialized fields of food industries, technology and manufacturing. In addition, the types of businesses that are represented insufficiently, such as those belonging to Native Americans or women, or businesses that represent traditional crafts, may be more likely to be eligible for grants.
You may get certain grants if your business is of a particular size, measured either by revenue or number of employees in your company. Some of the programs require businesses to address the needs of school age children, because education is an underdeveloped industry. And others may provide a 50% reimbursement of total costs for certain marketing projects.
As can be seen, there are plenty of financial aid options, if you know how to get free grant money. You just need to choose the right program and follow the rules.