How do I get free money to start a business? Can’t figure out how to find free money for your business, check out these amazing tips.
Even the best business ideas sometimes end up being just ideas! This is because finding the seed money to start a business is not always easy. Most first-time entrepreneurs have had to abandon their dreams just because they couldn’t find the initial capital.
Also, even with existing businesses, you need money to keep your business afloat, especially when the business itself can’t break even. But, it doesn’t have to be all hard. With the right information, you can access some low-interest loans or entirely free money grants to start your business or keep an existing one afloat.
So, do you know how to find free money for your business? If not, you must be quite fortunate if you are reading this. Today we discuss more on how to find free money for your business, giving you ideal solutions.
Let’s dive right in!
Best Ways How to Find Free Money for Your Business
There are several ways of getting free money for a small business. Some of these include:
1. Government Grants
This is the easiest way to get free money for your business – unless you have a philanthropic relative who wishes to invest in you.
If you didn’t know, the government offers small business grants right from the federal level to the city government level. The best thing here is that they won’t even ask anything from you. Not even equity.
Government grants support various businesses and organizations right from environmental conservation, technology, manufacturing, health, etc. And while most people fear the seemingly long application process, this can be the best way to get money for growing your business.
Mostly, these grants are offered based on your geographic location, as the federal and local governments try to induce economic development in various regions.
For instance, Ohio has the Advanced Manufacturing Program. Since manufacturing is crucial to Ohio, it established this program to promote manufacturing in the region with grants of even up to $500,000.
On the other hand, since Louisiana has an international port and a shipping center, the state offer grants to their entrepreneurs, with an aim to increase exports.
Different states and regions will offer different government grants for small businesses depending on what they value most.
Some of the most common federal government grants include:
Small Business Innovation Research Program
Abbreviated as SBIR, this program is tailored to fund small businesses in the research and development fields that display commercial potential. The grants usually range from $25,000 to $250,000.
However, if the business has growth potential, with time, you can receive even up to $1 million extra funding. It’s one of the best ways to get free government money to start a business.
Small Business Technology Transfer Program
This type of grant is also, in most ways, similar to the SBIR program. However, for you to access the small business grants, you have to be affiliated with a certain research institution. Here, the grants amount range from $25,000 up to $1 million.
Currently, the program is run by five federal agencies that set aside part of their budget and give it as grants to small businesses.
These agencies include:
- National Science Foundation
- National Institute of health
- Department of Defense
- Department of Health
So, if you don’t have a clue about how to find free money for your business, starting with government grants is an excellent choice.
Available Grants for the Different States
|State||Type of Grant|
|Arizona||Arizona Commerce Authority|
|Arkansas||Arkansas Infrastructure Grant Program|
|Colorado||Colorado Export Development Grant|
|Kansas||Kansas Job Creation Fund|
|IOWA||Economic Development Set Aside (EDSA)|
|Louisiana||Community Development Block Grant|
|Minnesota||Dairy Business Planning Grant|
|North Carolina||North Carolina IDEA|
|Texas||Texas Young Farmer Grant|
|Nebraska||Nebraska Child Care Grant|
2. Pitch Competitions
If you are looking for free money to start a small business, pitch competitions are also a great option to try out. Since the famous Shark Tank, numerous other pitch competitions have emerged – all offering start-up businesses free funding.
However, in contrast to Shark Tank, where an entrepreneur had to part with some of their company’s equity, many of these competitions don’t demand that.
Pitch competitions involve pitching your start-up to several investors and venture capital firms. If they like your idea or see the growth potential, they can offer you the required money to start or grow your business.
An excellent example of such a competition is the Urban Future Prize Competition. If you’ve not heard of it, it is a pitch completion from New York City, which grants two winners a $50,000 cash grant each year.
In addition, the program doesn’t leave the new entrepreneur there. It has an incubator program, which tries to nature the idea even more. This pitch competition mainly focuses on cleantech. However, numerous other competitions are focusing on various fields.
For instance, in San Diego, they have dedicated a whole week to such pitch competitions. These competitions are aimed at offering entrepreneurs and companies a chance to access free funding. It is known as the San Diego Startup Week, and the cash prize starts from $1,000.
If you are confident to pitch your idea, here are some excellent pitch competitions you can try out:
- TechCrunch Disrupt
- Flash Pitch
- HATCH pitch
- Hello Tomorrow Challenge
- Seedstars Summit
With these options, you won’t have to worry about how to find free money for your business. Just give it your best pitch, and you might walk out of those doors with what you need to make your business thrive.
3. Small Business Stimulus Grants
These are small business grants offered to help keep businesses afloat, especially during hard economic times. Examples of such grants include:
Targeted Economic Injury Disaster Loan (EIDL)
These types of small business funding are applied through the SBA (US Small Business Administration). If your business qualifies, you are eligible to get up to a $10,000 cash advance for your small business.
The SBA can forgive the cash advance if you use it to pay for increased costs, lease or mortgage payments, maintain payroll, cater for paid leave, etc. This means that it automatically turns into a grant.
The good thing is that there are no qualification requirements to get targeted EIDL grants. They are some of the easiest SBA grants to apply for.
Shuttered Venue Operators Grant
This is a COVID-19 grant introduced by the SBA to support the hard-hit businesses during the coronavirus pandemic period. These grants are given to specific individuals like talent representatives and theater operators whose businesses were closed due to the pandemic.
If you are eligible, you can qualify for up to 45% of your gross earned revenue as a grant. This can go to a maximum of $10 million.
However, there are several qualification requirements you must fulfill to get the grant. For instance, your venue must have been operational as of 29th Feb 2020.
4. Specialty Small-Business Grants
These are grants offered to disadvantaged groups or communities to help ensure entrepreneurial success in various demographics. Some of these specialty groups include women, minorities, veterans, LGBT, immigrants, etc.
Examples of such grants include:
MBDA (Minority Business Development Agency)
The program offer grants to businesses operating minority-owned businesses through their Minority Business Centers across the US. The centers provide business consulting, financial assistance, procurement matching, etc.
The MBDA also conducts an ongoing, separate grant competition to help minority groups.
This is the best place to start looking for a business grant if you fall under the specialty groups mentioned above. To apply for the grant, all you need is to visit their official website and go to the grant applicants section to see if you are eligible. For instance, if you are looking for an ideal source of free grant money for women-owned businesses, grants.gov is a perfect place to look.
However, you should note that the program offers numerous types of grants. Consequently, you might need to browse through several options before you get to the one that suits you. But, if you get that grant, the search will be all worth it.
Rural Business Development Grants by USDA
Are you wondering how to find free money for your business operating in a rural area? This option offers the best solution for you.
USDA Rural Development Grants offer funds for small businesses, ranging from $10,000 to $500,000. Therefore, if you are operating a business in a rural community, you might want to try out this option.
Corporate Small Business Grants
Besides the federal and state government grants, there is another excellent way of how to get free money for your business.
Some big corporations often offer grants to small businesses who win in their set contests. Generally, they do this for publicity and public relation.
However, through this, some small-time entrepreneurs get funding to help grow their businesses. In most cases, you’ll have to pitch your business idea to the investors before they can decide whether to fund your business.
So, if you were wondering how to find free money for your business but nothing was coming up, now you have a way out. Any of the above-mentioned options can help get your business going.