Thursday, September 22, 2011
Lesson #97: Securing a Small Business Grant
Grants can often be an effective vehicle to finance your business, just as venture capital can be. And, the upside of a grant is, oftentimes, it does not need to be repaid or come with any long term hooks, like investors bring. That said, grants are not easy to secure. So, if you can get one, more power to you. Today's lesson will summarize a few basics around securing a small business grant.
Grants are basically funds distributed by governments, corporations, foundations, universities or trusts to fund some specific project that is important to their cause. According to Wikipedia, there are over 88,000 grants issued each year, totaling over $40BN in size (a sizable chunk of money). These monies are usually granted to non-for-profit businesses to use in their specific research or development, that relates to the desired cause. But, sometimes, grants can be made to for-profit businesses where interests are aligned. So, for example, if a startup biotech business is working on a new cure for cancer, they could get a grant from the American Cancer Society to help accelerate their efforts. Or, as another example, let's say the Elvis Presley Foundation is trying to preserve rare old video footage of Elvis Presley, they could make a grant to a video preservation company.
As I mentioned, grants are not easy to secure, given the high level of competition looking for the same monies. But, if you: (i) know where to look for available grants, (ii) engage the services of a professional grant writer, and (iii) submit a proposal in the correct format, you have as good a chance as anybody to secure such funds. I wouldn't invest a ton of time here, given the low odds of closure, but it is definitely worth a little high level research to see if there are any low-hanging-fruit opportunities which you can easily pursue.
In terms of finding grants, there really isn't one centralized place that spans all the various entities that have grants available. So, it will require a lot of digging via Google, using the word "grant" and the relevant keywords for your industry. As in the examples above, that could include searches like "cancer research grants" or "video preservation grants". That said, the federal government has done a nice job of centralizing all federal government grants at Grants.gov. There, you can easily search over 1,000 annual grants offered from 26 different federal government agencies, across a wide range of categories (including small business grant opportunities). So, I would start your search there.
The next step could be to engage the services of a professional grant writer, who has expertise or relationships in the space and knows the "tricks of the trade." There is a good tutorial on how to hire a grant writer on the American Grant Writers Association website. And, there are many professional grant writers and grant researching companies that I found from a "grant writer" keyword search at Google. So, research a few, to see who has expertise within your industry or the organization you are trying to approach. Expect to pay $50-$100 per hour for the assistance of a service like this.
You can also try to write the grant proposal yourself, to save some money. The elements of a good grant proposal can be found on this grant writing page on Wikipedia. So, follow the standard format, and make sure you address all the detailed requirements that are being asked for by the granting organization.
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Posted by George Deeb at 8:55 AM