Benefits of Grant Programs
Running a small business can be a tricky endeavor, especially for those first delving into the world of entrepreneurship. While there are various forms of financial help available, grant programs specifically provide a unique way to cover certain expenses without the added requirement of repayment. With grant programs that are available to small businesses, there are substantial benefits to be realized. Here, we will cover the different types of grant programs available and the benefits that can come from taking advantage of such programs.
What Are Grant Programs?
Grant programs are a form of financial assistance that does not need to be repaid if the funding is used for a particular goal outlined at the onset. Grants are made available by many different entities ranging from the local, state, and federal level as well as different organizations that have specific purposes. This means that there are both public and private grant sources available to small business owners. In addition, different types of grant programs focus on specific aspects of business. These can range from start-up financing to the growth of an existing business to research funding.
Why Small Businesses Benefit From Grant Programs
For small businesses, a grant program offers an opportunity to develop their business further with financial assistance they wouldn’t otherwise have access to. Funding from a grant can also help small businesses become more established with assets and resources that contribute toward their success. Many times, small businesses are hindered by not having the capital for equipment, supplies, and other necessities for their particular business.
Getting a loan from traditional financial institutions can be difficult for any business—large or small—and for small businesses in particular; the eligibility requirements can be difficult to meet if the business does not have a significant track record. As such, grant programs can provide the necessary funds without having to worry about repayment terms or interest rates. Small business owners can be sure of the fact that they are not taking on any debt.
Types of Grant Programs Available
Regardless of the size of the business, there are many different grant programs that can be utilized to acquire the necessary funds. Each program generally falls into one of three main categories: startup grants, growth grants, and research grants. As the name suggests, startup grants are designed to help businesses launch from the ground up. In this instance, capital and resources are allocated for an idea not yet in operation.
Growth grants are focused on the expansion of an existing business. Instead of being leveraged for the business’s launch, these grants are used to increase the scope of the small business, such as launching into new markets, hiring staff, etc. Lastly, research grants provide funds and other resources to businesses that are conducting research and development endeavors.
Understanding the Role of Small Businesses in the Economy
It is important to understand the significance of small businesses and the role they play in the economy. Small businesses are essential to providing a variety of goods and services and tackling the challenges faced by larger‐scale operations. What’s more, small businesses often support the local economy, bring jobs to the community, invest in other small businesses, and foster the entrepreneurial spirit that the economy relies on. All of the benefits of small businesses point to the importance of having these types of businesses in the market and their need for support and capital.
Finding Grant Opportunities
In order for small businesses to take advantage of grant programs, they must first be aware of the available opportunities. In this regard, it’s important to do research and see what is available. Many times, grant opportunities are highlighted from government agencies, nonprofit organizations, and other sources. Furthermore, businesses should check in regularly with these sources to stay abreast of new opportunities.
Small businesses are essential to keeping the economy running. As such, grant programs can serve as a great additional source of capital and resources to help small businesses in their development and growth. These programs can range in focus, offering support to startups, helping existing operations expand, and researching new opportunities. With the right resources, small businesses can take advantage of grant programs to provide themselves with the necessary capital and resources they require to be successful.