Small Business Grants

We've all seen the headlines: "Millions in free government money for your business." Late-night infomercials and Internet advertisements promise grants to start or expand a business. Sound too good to be true? It is. Infact, "business grants" is too general a term to describe funding available for small businesses. This funding may be from a variety of sources and can come in the form of grants, loans, venture capital, debt or equity financing or a combination of various forms of traditional or non-traditional financing.

Facts About Government Grants

The federal government does not provide grants for starting and expanding a business.

Grants from the federal government are only available to non-commercial organizations, such as non-profits and educational institutions in areas such as, medicine, education, scientific research and technology development. The federal government also provides grants to state and local governments to assist them with economic development.

Some business grants are available through state and local programs, non-profit organizations and other groups. For example, some states provide grants for expanding child care centers; creating energy efficient technology; and developing marketing campaigns for tourism. These grants are not necessarily free money, and usually require the recipient to match funds or combine the grant with other forms of financing such as a loan.

If you are not one of these specialized business, both federal and state government agencies provide financial assistance programs that helps small business owners obtain low-interest loans and venture capital financing from commercial lenders.

Have a Question about Government Grants?

Visit the Finance, Money & Taxes Community Forum to get answers to your questions, and discuss financing issues with other small business owners and industry experts.

How to Find Grants

If you are a small business owner, use Business.Gov'sSmall Business Loans and Grants Search Tool to find specialized small business grant programs.

If you are a non-profit organization or a for-profit business involved in scientific and technology research and development, consult the following resources:

Arts, Humanities and Education

Community and Social Services

Health and Medicine

Science, Technology and Environment