The Myth of the Small Business Grant
One of the most common questions we get at the Small Business Development Center is about free money for a small business. I am always sorry when I get that question because I always have to give people disappointing news. There are no reliable grants available for retail and service businesses. Where does this myth come from, then? My “favorite” perpetuator of this myth is Google. A search for “small business grants” returns results for legitimate web sites such as grants.gov and sba.gov. Like any rumor, small business grants do have some basis in fact. However, the grants on these sites are for very specific types of businesses: typically, those with intellectual property (patents), university partnerships, or international trade.
- SBIR/STTR Grants: SBIR stands for “Small Business Innovation Research” and STTR for “Small Business Technology Transfer.” These grants often present together because they are for businesses who have a compelling product that fits the needs of one or more government agencies. The SBIR/STTR grants are for research and development. For both of these grants, there is typically a university research partnership. For example, the USDA may offer grant money for companies and their university research partners to develop organic growing products. The application itself is pages long and many applicants need to hire a professional grant writer to help them with the process. I have a client who has applied twice for an SBIR grant and has been denied both times. He paid over two thousand dollars for application assistance.
- STEP Grants: State Trade Expansion Program grants are for businesses who are working toward exporting their products to foreign countries. The grant helps pay for a business to travel to foreign trade shows in order to promote their products. These are matching grants, meaning the business has to put up half the money for travel expenses, and the state government grants the business owner the other half.
- Other Government Agency Grants: The Department of Education, the United States Department of Agriculture, and Environmental Protection Agency periodically offer grants to small business, but these are for very specific projects and retail and service businesses typically do not qualify. Note none of these grants are given on the basis of demographic status such as gender, race, veteran, or disabled. The grants that are available require extensive applications or matching money from the business. Even if the money is “free,” the business pays with time and sometimes money to apply for and access these funds.
Note none of these grants are given on the basis of demographic status such as gender, race, veteran, or disabled. The grants that are available require extensive applications or matching money from the business. Even if the money is “free,” the business pays with time and sometimes money to apply for and access these funds.
A little good news: Sometimes, a company such as FedEx, runs a nation-wide contest and awards businesses cash. In the FedEx case there are several one thousand-dollar awards for runners up and thirty thousand for the grand prize. Keep in mind that these national contests typically involve a social media contest for likes and shares of your own and the sponsor’s content. AmberGrantsForWomen.com is another national grant contest for women business owners; however, this one requires an application fee. Locally, Business Women of Pocatello invite their members to apply annually for grants between $500-$2000.
And the best news: You can take advantage of the tax payer dollars that have been granted to your local Small Business Development Center. We are taxpayer funded to provide no-cost consulting and low-cost training to any small business. This help includes business plans, financing options, marketing tactics, bookkeeping assistance, managing employees, and referrals to state and local resources.
You can find out about these opportunities with a subscription to the Small Business Development Center monthly newsletter. Send an email to swanann@isu.edu to be added to our mailing list or contact the Idaho Small Business Development Center today to begin working with a consultant.
About Ann Swanson
Ann Swanson is the regional director of the Small Business Development Center (SBDC) at the ISU
College of Business. Reach out at 208-282-4402 or swanann@isu.edu for an appointment.
