Small business grants are perhaps the most coveted of all types of small business funding. Grants don’t have to be repaid and, unlike equity funding, you don’t give up any ownership of your company. (The IRS does want its share, though, so be prepared for a tax bill.)
How do you actually win a business grant, or at least increase your odds of getting one? Here entrepreneurs who collectively won a variety of small business grants share tips for getting one.
1. Know your numbers
Grant winner: Chris Ronzio, CEO and founder of Trainual, which provides online training manuals and standard operating procedures for growing businesses.
Grant won: $150,000 from the Arizona Innovation Challenge (AIC).
Grant used for: Marketing: Company grew its marketing team from one person to five people, increased monthly ad spend from $30,000 to $100,000 per month, and invested in sponsoring events and podcasts to drive more traffic to its website and fuel growth.
Top tips:
Preparing for a grant is like preparing for an investor pitch—likely even harder, because they don’t have a stake in your business as the downside protection for the investment.
- Tip #1: Land your first paying customers before applying. Judges want to see traction, and nothing proves your idea is great like revenue.
- Tip #2: Build your story. A compelling investment has a story that people can rally behind. This story will be important for the grant judges, but even more so, it will give them confidence that you can recruit employees or raise investment as your business grows.
- Tip #3: Understand the metrics of your business inside and out. When you compete for a grant, the committee will want to see how you’ll use the money to evaluate impact. If you don’t know your numbers, you can’t share explicitly how the money coming in will impact the money coming out, and that could put you at a serious disadvantage.
2. Follow directions
Grant winner: Romy Taormina, CEO & founder of Psi Health Solutions, Inc., the maker of Psi Bands, a clinically-proven, patented medical device for the relief of nausea sold internationally.
Grants won: $15,000 from Huggies MomInspired Grant and two $3,000 State Trade and Export Promotion (STEP) Grant Program.
Grants used for: Huggies MomInspired Grant allowed Taormina to move out of her home office; STEP Grant allowed her to offset the cost of attending international trade shows.
Top tips:
- Tip #1: Put yourself “out there.” You have to apply (make the “ask”) to be considered. If you don’t ask, the answer is already “no.”
- Tip #2: Be articulate, specific, and concise in the grant request. Use proper grammar, spelling and pay attention to formatting.
- Tip #3: Follow directions. Seems like such a basic tip, and yet people do not follow directions. If it asks for X, provide X. Don’t give Y & Z. Example: if word count is a criteria, stick to the word count. Don’t eliminate yourself from the pool because you didn’t follow directions.
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3. Grant help
Grant winner: Brady Granier, CEO of BioCorRx, Inc. (OTC: BICX), an addiction solutions company located in Southern California that has developed a medication-assisted therapy that combines proprietary behavioral therapy and a sustained-release naltrexone abdominal pellet to help those struggling with both alcohol and opioid use disorders.