Grants are pockets of funding that individuals and businesses can apply for. Unlike traditional loans, grants are a monetary contribution that does not need to be paid back to the funder. Grants are typically offered by grant bodies, which typically include governmental organisations, non-profits, and individual financiers, to help businesses fulfill specific purposes - i.e research, expansion hiring employees, etc.
What is a business grant?
A business grant is funding awarded to eligible businesses as a form of financial assistance, to help the company grow and reach milestones. Most grants are typically provided by the government, along with private corporations, individual contributors, and charitable foundations.
Typically business grants are meant to fulfill a particular purpose. For example, the UK federal government is offering grant money to organizations as part of the Clean Air Scheme to support small businesses in becoming more environmentally friendly. When a business is funded through that scheme, the particular activity the financial contribution is meant to assist with is to lower a company’s fuel emissions and can not be spent on other things. It’s essential to check the rules and regulations for each business grant you apply for to ensure you meet the criteria.
Unlike traditional business loans, the key advantage of securing a business grant is that you do not have to pay the grant back. Therefore, being awarded a business grant will not affect your business’s financials while allowing the buisness to gain advantages.
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Different types of grants you can get for your business
There are several types of grants available for businesses. Here is a rundown of the three most popular types of grant funding available for start-ups ups and scale-ups:
Government grants
A government grant comes directly from the government in the country you’re located in. Usually, there are several different types of federal grants available. For example, there are grants to help companies more environmentally sustainable, hire employees, and help provide scholarships for research, education, and training,
If you are an organization located in the UK looking to be granted, check out the UK government’s online tool to find out more about grants may be eligible for.
Charitable grants
There are many grants available geared towards charities and non-profit organisation. In the UK, many non-profit organisations provide grants to support small businesses and start-ups getting off the ground.
Education grants
Education grants are primarily scholarships aimed at students looking to further their careers by studying for some time at universities or colleges. However, other small funding pots help businesses and entrepreneurs with short-term courses.
For instance, in Scotland, Skills Development Scotland has an Individual Training Account, accessible to anyone looking to develop their skills who earns less than £25,000 per year. It offers a small education grant of up to £200, which is to be used to pay for a short-term course. These courses could help people looking to start small businesses or work as sole traders. This opportunity is also open to unemployed people to help them get back into work.
Research grants
Research grants are geared to help businesses with a particular research project. They can help with a research project or improve an idea, product, or service.
An example of a research grant could include Innovate UK’s Innovation Vouchers. In this scheme, companies can be awarded up to £5000 for an external expert in the industry to assess and evaluate their business to help its growth.
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How to apply for a grant
When applying for grants, applicants should write a tailored proposal detailing how they’ll use the funding and how they will benefit from it. It can be a hard, time-consuming process, but the application needs to stand out from the competition. Here are some tips to consider when it is your turn for the application process:
- Research the awarding body and grant: You want to tailor your application to the particular purpose of the grant. Ensure you have enough evidence about why you are seeking the grant and which projects or work your business will use it for. It is important to ensure you meet the eligibility criteria prior to starting your application.
- Tailor your application:You want to look for grants that align with your need, industry, and purpose. Ensure you have enough evidence about why you are seeking the grant and which projects or work your business will use it for. It is important to ensure you meet the eligibility criteria prior to starting your application.
- Treat it like a proposal: Your application is essentially a business proposal to suggest why you’re the best company to benefit from the funding. You’ll need to use persuasive language and convince the people who award the grant that you’ll be responsible for it.
- Outline how you’ll use the money: Be clear about how the funding will benefit your business, and explain how you’ll use it.
- Apply as early as possible:Depending on the funding body, there could be a limited pool of money and/or limited number of businesses that can avail the grant. Which is why if you get your application in earlier, you’ll have a higher chance of being awarded the grant and potentially accessing larger sum of funds.
Writing grants can be tricky and time-consuming, especially if you are new to the process. Many services offer support with grant writing, including professional grant writers who will support you in creating excellent grant applications tailored to the funder’s wants. They will streamline the grant writing process for you, ensure you are on the right track and offer advice and recommendations.
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Our team has been working with investors, debt finance specialists, and advisors for years, so we know the market better than anyone. If you want a no-obligation recommendation for a specialist that fits your business, simply contact us.
Examples of small business grants in the UK
The best way to find grants for your business is to find out what financial assistance is available in your local area. Because the UK is split up into four countries, there are different awarding bodies in each place. If you are looking for government grant money for your, here are some resources you should check out based on your location.
England
You can look up funding sources for financial support in England at the LEP Network. They have a list of all the Growth Hubs in England, providing business owners with all the support options in their local area.
Scotland
Scottish Enterprise runs a grant program if your business is based in Scotland. They have various funding options available to cover multiple projects. They also have details on supporting businesses that have been affected by Covid-19.
Wales
The Business Wales website gives you all the information you’ll need about finding grants online. They’ve got a variety of sources like government grants, charitable organisations, and local authorities. It’s the best site for finding financial aid in Wales.
Northern Ireland
Northern Ireland has plenty of options for finding a grant online. Enterprise Ireland is the source for finding financial aid if you’ve got an already launched business. They have a range of services and packages, such as the Job Expansion Fund, a grant aimed at helping you grow your company.
There are several grant programs available for startups and SMEs across the country. It’s about learning more about them and finding the one that best suits your growth needs.
However, even after early stage companies are able to identify grants well-suited to them, they often face some challenges when leveraging these programs. This includes difficulty in matching contributions, proving alternative funding sources, and funding the delivery of milestones consistently.
If you’re looking to solve these challenges, Fundsquire’s Grant Advance is a simple funding solution that lets you use your future grant payments to fuel your current milestones today. You can learn more here.
Looking for funding?
We can help. Fundsquire has financing solutions for every step of your growth journey.
