Small Business Grants: Fact or Fiction
Written by Lynn Wilson
March 14, 2008
A couple weeks ago I received a call from my brother-in-law asking me to help him find and write a small
business grant. It’s a request we receive often at the Innovation Center. I proceeded
to tell him that small business grants are basically a myth. There is no government
agency waiting to hand out money for people to start excavating businesses,
restaurants, or any other type of for-profit businesses. I could sense his frustration
but couldn’t tell if he thought it was me or him that was misinformed. Unfortunately
this is the same frustration many of our clients feel when given this response.
We’ve all seen the infomercials with the guy in the funny suit begging us to buy his books that tell you
how you can obtain free money to start a business. In fact, there are many advertisers that want you to
believe there is a pool of money just waiting to be grabbed up by inspiring entrepreneurs. The truth is
most grants are awarded to non-profit organizations. Very seldom are they awarded to fund for-profit
enterprises like small businesses. The harsh reality is that most small businesses are started with
personal savings or loans from family, friends, or commercial loans. Even the SBA does not give grants
to start a small business.
I recently ran across an article about a woman who started a small business with grants funds. The
difference; what she actually started was a non-profit organization. Grants that are available in the
small business sense are those that address societal problems such as the one mentioned in the article.
Here is a link to the article http://www.successinstyle.org/familycircle.pdf .
There are some grants available to assist high-technology companies. For instance, the Small Business
Innovation Research (SBIR) program does award grants to companies for the research and development
of products that have the potential for commercialization. Even these grants are limited to