Financing has always been a big concern for small businesses
and many entrepreneurs look for financing in the form of grants. However, there
are strict guidelines for government grant eligibility. For instance,
eligibility depends on what kind of business you’re in and the benefits that
the government and taxpayers may receive from investing in your business. This
article by the SBA lists some key information that entrepreneurs should know
about government grants. Some of that information is included below. For the
full article click on the following link:
http://www.sba.gov/community/blogs/truth-behind-government-grants-small-businesses.
Federal and state governments do not provide grants to:
start a business, pay off debt, or cover operational expenses. However, federal
grants are generally aimed at specific industries and causes that are
identified by the government which include scientific and medical research,
conservation efforts, and so on.
State business grants are available, but are closely tied to
the agency’s agenda, for example to advance regional economies and promote
causes such as clean energy development. State grants are also geared towards
larger businesses and may also require that the grant be matched or combined
with other forms of financing such as a loan.
If your
small business is engaged in scientific research and development (R&D) then
you may qualify for a federal grant under the Small Business Innovation Research
(SBIR) and the Small Business Technology Transfer (STTR) programs. These
programs encourage small businesses to undertake R&D projects that: meet
federal R&D objectives and have high potential for commercialization.
According to
the SBA, the bottom line is that if you are looking for free money then you
won’t get it from the government. You won’t have much luck securing this type
of funding unless you fill a specialty area. So if you are looking to start or
grow your business, you should consider exploring other funding options such as
loans or crowdfunding.
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