Government Grants for Small Business

Small businesses need capital. While some of this capital is utilized for payroll, fixed costs such as rent or mortgage, utility payments, inventory purchases, some funds are directed to research and development, and expansion needs. Obtaining capital for whatever the need requires hard work, perseverance, stamina, and business acumen. Are government grants available for small businesses? The answer is “Yes,” but there are requirements attached to such an answer.

If a small business is engaged in research and development, and there is a high degree of commercial success possible, then the federal government offers two grant programs. These programs are overseen by the Small Business Administration (SBA), but administered through the many granting agencies within the federal government. The grant programs are: the Small Business Innovation and Research Grant (SBIR), and the Small Business Technology Transfer Grant (SBTT). Numerous stipulations and regulations are attached to both grants, and the federal government clearly defines the scope as to what constitutes research and development. Too, these grants are highly sought after so competition is fierce. It is fierce because such grants can and do provide significant funds for a small business. These funds often provide the needed impetus, i.e., cash flow for continued research and development.

Some of this research and development is cutting edge particularly as it relates to green technologies. Through the Department of Energy (DOE), numerous alternative energy sources are being explored from a combination of wind, solar and water power to biomass fuels to provide energy to homes and businesses.

The National Science Foundation (NSF) provides grants to such far-reaching research projects as developing new hearing aids to HIV/AIDS research. The list of fund-able research projects is nearly inexhaustible, so it behooves a small business to understand the criteria as set forth by the federal government as it relates to research and development. A thorough understanding of what constitutes a probable degree of commercial success is important, too. (All this is defined by the federal government).

To appreciate the scope of available funds to small businesses, it is imperative that the business receive daily announcements of current federal funding initiatives. By reviewing this list, and by reading the synopsis or full announcement, a small business can determine its eligibility for a related funding initiative. While some announcements exclude small businesses (and this will be stated clearly) many do not, and others require a partnership between a small business, non profit or a group of small businesses (consortium). All contained in the funding announcement.

States, too, provide government grants to small businesses. However, the scope can be quite limited depending upon the state. Montana offers and encourages businesses involved in green technologies, particularly those in the biomass field, to explore state options, and submit grants. Florida limits its government grants to businesses involved in targeted industries: advanced manufacturing, and particularly aerospace. Georgia offers grants to small businesses involved in the tourism industry.

The key, of course, is in-depth research with the clear understanding that good research takes time and effort.

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