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Minority small business grants are government-issued loans and grants that help minority entrepreneurs start or grow their businesses. These grant programs can be a key tool for starting up, expanding and diversifying the U.S.’s economy by helping to create new jobs in underserved communities.
Small business awards for minorities are financial incentives offered to minority-owned firms based on race, gender, personal status, or geography. Grants aren’t loans, and they don’t have to be paid back after they’ve been given out. Corporations or special interest organizations give minority business grants with the objective of assisting minority enterprises.
Selecting the Best Minority Small Business Grant
When deciding which minority business grants to apply for, pay close attention to the eligibility restrictions as well as the grant’s application deadline. If you don’t fulfill any of these requirements, you won’t be considered for the grant. Only apply for grants for which you are completely eligible; otherwise, you will be wasting time and effort that may be better spent on other grant possibilities or startup loan applications.
Without the correct resources, finding the perfect small business grant might be tough. While government agencies do not give grants to start or expand companies, they do provide the finest tools for finding and applying for grants. These tools may also assist your company in other ways, such as locating and applying for minority business financing.
Best Grants for Minority-Owned Small Businesses
The minority business grants that are most appropriate for your company are those for which you are most eligible. Meeting the grant’s qualifying criteria will assist to guarantee that your application is not rejected before it reaches the award committee. We’ve put together a list of some of the greatest minority small business grants and grant options available.
The following are the top 11 minority business grants and grant resources:
Amber Grant
The Amber Grant Foundation, in collaboration with WomensNet, awards a $2,000 grant to a woman-owned company every month. Monthly winners are then placed into a competition to earn a $25,000 yearly award from the foundation. The Amber Grant application is a simple online form that includes advice from the grant’s advisory board on how to apply.
For this award, you must submit a $15 application fee. Application fees are collected to help finance future awards and pay the foundation’s administrative expenses. The Amber Grant Foundation’s website contains a comprehensive frequently asked questions section that discusses the application fee’s purpose as well as answers to a range of other grant-related inquiries.
First Nations Development Institute
The First Nations Development Institute is a charitable organization dedicated to assisting Native Americans, Alaska Natives, and Native Hawaiians. They not only offer grant assistance services to aid you with your applications, but they also have a variety of grant programs based on which of the aforementioned categories you qualify for and where you live.
The First Nations Development Institute offers a variety of grant possibilities, with new ones being introduced when old ones expire. If you wish to be notified of new opportunities and resources as they become available, you may subscribe to their email list.
National Black MBA Association
Through its Scale-Up Pitch Challenge, the National Black MBA Association (NBMBAA) awards cash prizes ranging from $1,000 to $50,000. The challenge is for startups and early-stage firms with a black (of African heritage) entrepreneur who has at least an equal ownership share in the company. NBMBAA also links entrepreneurs with early-stage investors and venture capitalists via the challenge.
You must be a member of the NBMBAA ($10 monthly membership fee) and submit an online application to partake in the challenge. Selected applications will participate in a three-minute pitch competition at a regional level, with finalists advancing to the NBMBAA annual conference to compete.
National LGBT Chamber of Commerce
The Nationwide LGBT Chamber of Commerce (NGLCC) is a national lobbying group dedicated to promoting economic possibilities for LGBT-owned companies. The National LGBT Chamber of Commerce (NGLCC) certifies LGBT-owned businesses. This accreditation helps other businesses looking to build an LGBT-inclusive supply chain to identify your LGBT firm.
The NGLCC not only provides certification, but it also posts funding and grant possibilities on its blog as they become available. NGLCC has been a go-to resource for LGBT entrepreneurs throughout the country because it understands the issues and demands of LGBT-owned firms.
The Minority Business Development Agency (MBDA)
The MBDA, which is run by the US Department of Commerce, strives to assist minority company owners and minorities who desire to start their own firm. The idea is to help the economy thrive and create more employment by providing greater chances to minorities who may not otherwise have had them.
The MBDA operates real business centers around the nation where you may obtain help with your business requirements. These business centers aim to help your company succeed by providing anything from financing information to legal and marketing assistance. This includes assisting you in identifying grants that may be appropriate for your company and then guiding you through the application process.
Your local MBDA office may also assist you in connecting with state authorities that deal with minority-owned small business issues. These state agencies may provide you with financial or technical support, as well as grant preparation and application assistance.
Small Business Administration
If you own 51 percent of your firm and are socially or economically disadvantaged, you may be eligible for Small Business Administration business development assistance (SBA). Although the SBA does not provide subsidies to help you establish a company, it may assist you in obtaining a minority business loan or an SBA startup loan.
The SBA may also assist you in locating a mentor to assist business with a variety of activities, such as launching a new product or establishing a lean manufacturing method. The SBA may also be able to assist you uncover grants that you qualify for, as well as a mentor to guide you through the grant application process.
USA.gov
USA.gov, originally BusinessUSA, is a one-stop-shop for all government information. This database may be used to locate programs, grants, and other resources aimed at assisting minority small business owners. You may acquire the funding or development assistance you need to take your company to the next level.
This resource will give you with connections to federal government agencies that provide small company loans and grants, as well as a database of state and local business financing initiatives.
Grants.Gov
Using the federal website Grants.gov, you may locate several of the top minority small business grants. The website has a list of grant possibilities as well as information that will assist you in putting together a stronger grant application package. The majority of these funds, on the other hand, aren’t for founding or developing small firms, but rather for research and product development.
Small companies may apply for over 1,000 awards through Grants.gov. Many of these are for extremely specialized niche possibilities that correspond with the present goals of a government agency. While you are unlikely to be qualified for most of them, there may be some that are a good fit for your company. Take your time looking over the list; you could come upon an unexpected funding opportunity for your company.
FedEx
FedEx hopes to boost small company innovation by offering ten scholarships ranging from $15,000 to $50,000 to product-focused small enterprises each year. The highest donation in 2017 went to two Colorado-based women entrepreneurs who reuse military waste to benefit veterans. This grant may be appropriate for you if you are a minority with a cutting-edge product.
To join the contest for a FedEx small business grant, go to the contest website and fill out the form. You will be asked a few questions about your firm, including an elevator pitch on what makes your company unique and how you plan to utilize the grant funding. You may also send a 90-second video to accompany your application, while it is not essential.
NASE Growth Grants
Small company Growth Grants of up to $4,000 are available from the National Association for the Self-Employed (NASE). Grant winners must be micro-businesses to be eligible. The funds from the grant may be used to assist your company sell itself, advertise, grow, and recruit new personnel. Through its Growth Grants program, the NASE has provided approximately $1,000,000 since 2006. NASE Growth Grants are a kind of general grant that is available to everyone.
You must be a member of NASE to apply for this award. The price of a NASE membership is determined on the enrollment level you choose. The cost of a monthly subscription starts at $12. Once you’ve joined, you’ll have access to the grant application, which you may use to apply for a grant.
USDA
The USDA’s Value Added Producer Grant (VAPG) program provides small businesses with subsidies of up to $250,000 to assist them engage in value-added activities such as processing and selling their goods. These funds are available to rural enterprises that operate as individual agricultural producers, agricultural producer groups, or farmer or rancher cooperatives.
Grants.gov has information on how to apply for this program. These awards are only available during an open Notice of Solicitation of Applications period. For more information on this grant opportunity, as well as other USDA business loans, contact your local USDA Rural Development office.
How to Apply for Grants for Minority-Owned Small Businesses
It is critical to follow the guidelines carefully when applying for small company funding. If you don’t follow the requirements to the letter, most grants will reject your application. There’s a good chance that no two grants you apply for will have the identical application procedure, so you’ll have to do some legwork to be sure you’re doing everything correctly for each one.
The five stages to applying for most minority small business awards are as follows:
1. Obtain certification as a minority-owned company.
As a minority-owned firm, the first step is to get certified by the Minority Business Enterprise Development Center (MBE). It will not only aid you in gaining easier access to funds (and making grant applications simpler), but it will also give you with additional advantages such as business development support. The Minority Chamber of Commerce can assist you with the certification procedure if you require it.
2. Come up with a business plan
A business plan is required for the majority of minority small business grant applicants. It’s preferable if you’ve already written one before starting your grant hunt. This is because meeting grant deadlines is challenging enough without also having to build a business plan from start.
Your business plan will serve as a road map for your company. It should provide everyone peace of mind about the company’s direction and long-term viability. If you’re not sure how to construct a business plan, we recommend utilizing business plan software like LivePlan’s. It will help you through the process step-by-step.
When applying for a minority small business grant, make sure your business plan includes a section on how your small company will benefit the economy and community. The fact that you’re a minority-owned company should be highlighted in your business strategy as well.
3. Look into grants to see which one is best for you.
It’s critical to put in the effort to investigate the correct grants to ensure you’re not wasting your time and maximize your chances of being awarded. There will usually be a large number of candidates who exactly fulfill the grant conditions. Your chances of winning the grant will be reduced if you do not completely fulfill the standards.
Only apply for grants that you have a good possibility of winning, and make sure you understand the application requirements well. As you progress through each application, this research will come in handy. Many grants are given to just one or a small number of firms that apply. As a result, competition is likely to be stiff, and you’ll most likely need to examine many grant programs before applying to the one you have a chance of winning.
The following is a typical procedure for exploring minority small business grants:
- Find a grant: The first step in the process is to find a grant opportunity that you feel you could be qualified for, whether via an internet search or a referral from another source.
- Examine the eligibility standards given in the grant announcement to confirm that you meet them. Ineligible candidates will be denied right away, so there’s no use in spending time filling out an application if you don’t satisfy the requirements.
- Determine the deadline: Examine the grant announcement carefully to ensure that you understand when the application must be submitted. If you have any queries regarding the grant deadline, you should contact the grant provider ahead of time for clarification.
- Check out the whole application process here: Everything you’ll need to submit as part of your minority small business grant application will be included in the award announcement. Examine this area to see whether any extra papers or information that isn’t publicly accessible will be required.
- Take a look at previous champions’ records: Reading about previous grant recipients can give you an idea of the sorts of firms that have won support.
- If you have any queries, please contact the grant organization: In most grant announcements, there is a point of contact you may contact if you have any queries. If any information in the award announcement remain unclear after careful reading, contact the firm or agency that granting the grant for clarification.
4. Gather the Documentation You’ll Need
You should be able to collect all of the relevant documents and write up any write-ups required by the grant application at this time. In general, you should expect to submit your application with some basic papers, such as your business plan, evidence of company ownership, and your business location.
Making a checklist of the essential papers is a smart idea so you can keep track of what you still need to gather as you go. Some grant applications, for example, may require you to write 500 words on why your company is a good match for the grant’s aim. Others may want an organizational chart from you.
The following are some examples of documentation that may be required:
- Plan of Action
- Ownership Documentation
- Business Address Proof
While these are the most common materials you’ll need to provide, you can expect to tweak your business plan for each application depending on the grant’s criteria. It’s similar to making a pitch to an investor, except that no two pitches should be same. You want your company to appeal to the individual grant committee that will be reviewing your application each time, and each committee will be searching for distinct features.
5. Submit your Minority Business Grant application before the deadline.
It’s critical to submit your grant application before the deadline, since late submissions are often rejected. Working backward from the application date will ensure that your grant application is filed on time.
This entails starting at step one of the application process and working backwards to determine how much time is necessary for each required job. This will assist you in planning the time you’ll need to finish all of the needed parts of the application before the deadline.
To enhance your chances of having your application more time with the committee that grants the money, you should apply as soon as possible. If you haven’t heard from them within a week, contact them to ensure that they got your application. Things like these show the committee that you’re excited to be a part of their program, and that you’d be a good fit to represent their organization as the grant winner.
Organizations that Provide Funding for Minority Small Business Grants
There are several grants available to minority company owners, but the majority of them have stringent eligibility conditions. The majority of these funds are for particular research or are for lower sums than most firms would need. You’ll most likely find funds from companies or special interest organizations, or as a third party to a government grant if you qualify.
The following are the three greatest areas to look for minority business grants:
Corporations
Many businesses are keen to get positive news, strengthen their customer relations, assist others in their field, and maybe obtain tax benefits. All of these objectives may be accomplished by awarding grants to a specified set of individuals. However, since the majority of these incentives are intended to attract big applications, they are often available to all minorities or small firms. As a result, the competition is more tougher than for other lesser grants.
2. Special Interest Organizations
Nonprofit organizations and national associations, for example, often provide funds to a group of minority company owners who meet their purpose criteria. A national group of Hispanic company owners, for example, may provide awards, particularly for Hispanic-owned enterprises. While corporate contributions benefit a broad range of enterprises, special interest organizations provide considerably more focused grants that benefit a single minority group.
Typically, affluent people will pump a large amount of private money into enterprises in these groupings. Unless you’re highly connected inside these unique special interest groups, these possibilities are seldom promoted and are tough to come by (often through a form of membership).
Grants from the government
The government’s direct funding to minority-owned small enterprises are often utilized to conduct research or produce specific goods that will help a certain government agency’s purpose. Outside of finance, the government has a number of wonderful initiatives that may assist small company owners with a variety of issues. These programs cover everything from locating a suitable grant to teaching you correct accounting techniques.
When it comes to finding a grant for their firm, most small business owners look to the government first. Grants from the government, on the other hand, are often given to third-party intermediaries. These grant money, whether as third-party grants or low-interest loan alternatives, may be very useful to minority-owned small enterprises.
The Benefits and Drawbacks of Minority Small Business Grants
Minority small business grants have many benefits, the most prominent of which is that they do not need repayment. Furthermore, grant possibilities may be readily located by doing an internet search and might come from a range of different sources. Grant opportunities, on the other hand, are often very competitive, qualifying for them may be tough, and application deadlines are rigorous.
Advantages
The following are some of the advantages of minority small business grants:
- Grants do not demand repayment: Unlike loans, grants do not require payback. Grants are effectively unrestricted funds for your company.
- A variety of sources of funding are available: A range of grant possibilities are available from a variety of sources, targeted at different sorts of enterprises and supporting a variety of company requirements. If you don’t qualify for one award, there are probably others accessible to which you do.
- It’s simple to look for grant possibilities on the internet: Finding grants has never been simpler thanks to the ability to search the internet for particular grants or awards offered for certain reasons or organizations.
Drawbacks
The following are some possible downsides of minority small business grants:
- Small company owners compete fiercely for grants, which are widely sought after due to their nature and the fact that they do not demand payback. Because of the large number of submissions for each project, your chances of winning financing are slim.
- Grants are typically granted once a year, but some are offered more often, and have strict application deadlines. If you miss a deadline for a grant, you will not be able to apply for that award until the following year.
- Obtaining a grant might be challenging: Many grants have stringent eligibility restrictions, which may exclude you or your company from qualifying. You will be disqualified for the award if you do not satisfy all of the conditions. When applying for grants, pay close attention to the conditions specified.
Minority Small Business Grants Alternatives
It is not a guarantee that you will be given a minority small business grant if you apply. If the amount of time and effort required to apply for a minority small business grant does not appeal to you, there are alternative ways to support your company. Personal loans for company, SBA microloans, and ROBS (rollover for business starting) may all help you get the money you need. Businesses in need of higher quantities of money might consider approaching an angel investor.
Alternatives to minority small business subsidies include the following:
Business Personal Loans
A personal loan for company might help you get the financing you need for your small business. Own loans are based on your personal credit history, therefore no company plans or estimates are required. You won’t have to give up any collateral equity and may still provide initial cash to your company if you use an unsecured personal loan for business.
Microloans from the Small Business Administration
SBA Microloans are another option for minority business assistance. The Small Business Administration funds these loans up to $50,000, but they must be generated by SBA-approved community-based charities. Microloans from the Small Business Administration (SBA) have maturities of up to six years and are designed for small enterprises and startups.
ROBS
If you have existing retirement savings that you are prepared to put to use, a ROBS enables you to use those resources to support your small company. Because a ROBS is not a business loan, there is no debt to pay off or interest to pay. One of the main advantages of a ROBS is that you may spend your retirement savings without incurring any early withdrawal penalties or taxes on the amounts you remove.
Angel Investors
Individual investors known as angel investors contribute capital to startups and early-stage companies in return for a share of the company’s stock. An angel investor will want to believe in your potential to succeed as well as the expected development of your company. Angel investors support businesses by investing their own money, and when they do, they are investing as much in you, the business owner, as they are in your company.
Frequently Asked Questions
How can I apply for a grant for a minority-owned business?
The first step is to look for a minority business grant that you are eligible for. Read the grant announcement carefully and follow the application instructions to the letter.
What government grants do small businesses have access to?
Small company grants are available from the federal government in a variety of forms. Grants.gov has a comprehensive list of government grant possibilities.
Are there any grants available for minority-owned businesses?
Minority companies may apply for grants, but locating them might be difficult. Many minority business awards are provided by NGOs, or organizations dedicated to assisting certain minority groups.
Conclusion
Minority small business grants may be a helpful source of cash for groups of people who don’t get as much money as others. Finding the perfect one, on the other hand, might take a lot of time and study, and the whole process can take a long time before you even know whether you’ll be paid. It’s worthwhile if the grant funds your project, but there are no promises.
