Looking for small business grants that are geared towards immigrants and minorities? Well, you’re not the only one. Business grants are often described as “free money,” so they tend to be pretty popular.
But, here at Startups, we hate the term “free money.” It’s a word that people throw around a lot when they’re talking about grants. The reason we don’t call small business grants “free money” is because they take a lot of work to get. And there’s a lot of competition, so oftentimes that work doesn’t even result in a payday. Sure, you don’t have to pay back a small business grant the way you do a business loan — but it’s certainly not “free money.”
However, we also understand that minority business grants can really boost a startup, if they qualify. And it’s not like other forms of startup funding — like venture capital, angel investment, and even crowdfunding — don’t also take a lot of time and effort. So, we thought we’d throw together some resources for any startup founders who are interested in getting a minority business grant.
While there aren’t too many small business grants that are specifically for immigrants and other minority groups — they do exist! Refugees in particular may find that they have more options than other groups for small business grants. The federal government also has the Minority Business Development Agency, which helps women and minorities grow their businesses. Check out these government grants for minorities.
First off, let’s define what counts as a “minority” in this world of grants. African-American, Hispanic-American, Asian-American, Pacific Islander, Alaskan Native, or American Indian people qualify as minorities. In order for a business to qualify as minority-owned, it needs to be at least 51 percent owned by someone from one of those groups.
Additionally, you’ll often need to be certified as a minority business enterprise (MBE) or a disadvantaged business enterprise (DBE) in order to qualify for certain loans or grants. That’s not the case for all loans and grants, however, so make sure it’s a requirement before going through the process of getting certified.
Government grants for small businesses come in three forms: federal, state, and local. Federal grants usually offer the most money — and have the most competition. They’re also pretty specific and usually tied to a government agency that has clear requirements for qualifying for the money — and for what they expect you to do with it.
State grants, on the other hand, are usually less money than federal grants but also — depending on your state — less competitive. State governments may work with the federal government to administer money that’s been set aside specifically for small business grants.
And on the local level, grants tend to be even smaller but they may be easier to get, because personal connections still mean something! Usually these grants are about improving your local community, so if your startup or small business is focused on bettering your town or county, definitely take a look at local grants.
In addition to agency-specific government grants for small businesses, there are grants available that are much, much more specific. Your best bet for finding a grant that matches your startup closely is to search the grants.gov database to find out what’s currently available and what most closely matches your startup. You should also check back periodically, as government grants for small businesses end and are added frequently.
Another thing to know about when you’re looking at government grants is that a lot of grant management is handled through the Small Business Association or SBA. The SBA doesn’t actually manage the money — that’s done through partner organizations, like community grants — but rather they act as a go-between for the government and partner lending organizations.
The Minority Business Development Agency is a government-run agency that helps connect minority small businesses owners with the resources they need to succeed. Those resources include capital, contracts, and markets. They operate business centers throughout the country where minority small business owners can go to get help with getting ahead.
The grants offered through the Minority Business Development Agency come at different times, so it’s worth it to keep track of what they’re offering on their homepage.
FAST currently provides $3 million in total funding (up to $125,000 per applicant) for outreach, financial support, and technical assistance to next generation research and development (R&D) focused small businesses. They’re especially interested in women, socially/economically disadvantaged individuals, and applicants from underrepresented or rural areas who are competing in the SBIR and STTR programs.
In addition to federal small business grants, states also offer minority business grants. State grants are even more specific than federal grants, and they usually provide less funding. They also work in conjunction with federal and other state grants and many are matching grants, which means you’re required to meet the amount of money they give you.
So those are the sort of cons. But a big pro is that fewer people are applying for state grants than for federal minority business grants, so if you find one that’s a good fit, it could be a good deal. You can search for state minority business grants in your state on any major search engine.
You can also turn to the Office of Economic Development in your area. These offices are run by the Economic Development Administration and they offer small businesses help with grants, technical assistance, and other resources to help them grow. EDA grants are changing all the time, so check in here for information about what’s currently available.
The SBA also runs Small Business Development Centers (SBDC) across the country. They’re often hosted by top universities and state economic development agencies, which share the cost with the SBA. They offer free business consulting and low-cost training services including: business plan development, manufacturing assistance, financial packaging and lending assistance, exporting and importing support, disaster recovery assistance, procurement and contracting aid, market research help, 8(a) program support, and healthcare guidance. You can find the SBDC in your state here.
There are also private minority business grants, but they tend to be available for limited amounts of time, so we’re not going to list them with links that will expire in a month or two. Instead, be creative with your search engine searches. Try “private grants for minority business owners” or “grants for disadvantaged groups.” Or try searching for grants for the specific group you’re a part of. Like we said — “free money” doesn’t come free, but if you do your digging, you might strike gold. Good luck!
And, of course, grants aren’t the only options for startup funding. There’s venture capital. Private equity. Loans. Crowdfunding. There’s a whole world of funders out there! Don’t miss our guides to the full range of startup funding options, below.