The ongoing coronavirus pandemic has millions of small businesses on their last legs. Virtually all industries have been affected since they can’t serve customers when the entire US has been ordered to stay at home. The logical solution to an unexpected loss in revenue is a small business loan or business line of credit. But many traditional and non-traditional lenders have reportedly paused funding or are only working with specific industries.
The SBA has launched two loan programs to help struggling businesses: Economic Injury Disaster Loans (EIDLs) and Paycheck Protection Loans. However, experienced business owners don’t just automatically pursue the most popular options. They do their research to ensure they are not missing out on something that’s even more advantageous and accessible.
This research would yield many coronavirus grants offered by the federal government, state governments, local governments, and private companies. And unlike traditional business grants, the following grants are not extremely difficult to qualify for.
If you’re looking for business grants unrelated to coronavirus, you can jump to the following topics:
- What Are the Best Federal Business Grants?
- What Are the Best State Business Grants?
- Which Are the Best Local Business Grants?
- What if I Can’t Qualify for a Small Business Grant?
1. Economic Injury Disaster Loan Advance Grant
Businesses that apply for EIDLs can request an emergency cash advance of $10,000, distributed within three days. This advance can be forgiven (meaning you don’t have to pay it back) if you use it to compensate employees or cover operational expenses. Examples include maintaining payroll, compensating employees on paid leave, covering increased costs related to supply chains, or mortgage or lease payments. In other words, you must claim that you are using the money to keep your business alive, as opposed to expansion-related investments like purchasing additional property, hiring more employees, or securing new equipment.
Here’s the kicker: Even if your application for an EIDL is rejected, you can still request the advance and have it forgiven! You just have to claim that you are using the money for the aforementioned purposes.
The deadline for the emergency cash advance is December 30, 2020. You must apply through the SBA’s website.
2. Michigan Small Business Relief Program
The Michigan Small Business Relief Program is offering $10 million in grants to Michigan-based small businesses. Up to $10,000 is available for companies that can prove considerable losses in revenue due to Covid-19.
3. Maryland Relief Grant Fund
Maryland’s Department of Commerce offers $50 million in grants, with a maximum amount of $10,000 for eligible businesses. Maryland-based businesses with 50 or fewer employees can also apply for loans of up to $50,000 through the state’s $75 million Emergency Relief Loan Fund.
4. Iowa Small Business Relief Program
This program offers grants ranging from $5,000 to $25,000, as well as tax deferrals.
6. NYC Small Business Continuity Loan Fund
New York City-based small businesses with up to five employees can apply for grants that amount to 40% of their payroll costs for two months. Companies with fewer than 100 employees that have lost at least 25% of their revenue, can also apply for interest-free loans up to $75,000.
7. Seattle Business Stabilization Fund
Seattle-based businesses can receive grants of up to $10,000 from a $1.5 million fund.
8. Denver Economic Development and Opportunity Relief Package
This relief program offers up to $7,500 in cash grants to eligible, Denver-based businesses.
The following grants come from private companies:
9. Facebook Small Business Grants Program
The world’s largest social network offers $100 million in cash grants and ad credits to up to 30,000 businesses located in 30 countries. Facebook also recently launched a Business Resources Hub, which provides strategic recommendations for companies looking to stay connected with customers through digital channels.
10. Amazon Neighborhood Small Business Relief Fund
Amazon offers $5 million in cash grants, but only for Seattle-based businesses with fewer than 50 employees and less than $7 million in annual revenue. Eligible businesses must also have a “physical presence within a few blocks of our Regrade, South Lake Union, and Bellevue office buildings that are open to the general public, and that are reliant on foot traffic for customers.”
11. James Beard Foundation Relief Fund
This non-profit culinary arts foundation recently launched the Food and Beverage Industry Relief Fund, which offers micro-grants to small businesses in the food and beverage industry.
12. Bacardi’s #RaiseYourSpirits Campaign
Rum manufacturer Bacardi offers $3 million in grants to bars and restaurants that have lost revenue due to Covid-19.
13. MainVest’s Main Street Initiative
Crowdfunding platform Mainvest is offering $2,000, zero-interest loans for restaurants and other brick-and-mortar businesses with 120-day terms.
14. Yelp Support
Yelp is offering $25 million in waived advertising fees along with free advertising and other services to independent restaurants and bars that have lost revenue due to Covid-19.
15. Google Ad Credits
Google is offering $340 million in Google Ads credits to small businesses with active Google Ads accounts from the past year. The credits will reportedly appear in the accounts automatically and can be used until the end of 2020.
The following local and state governments are offering highly affordable loan programs to businesses affected by Covid-19:
16. Birmingham Strong Emergency Loan Fund
This Alabama city provides zero-interest, 180-day loans of up to $25,000 for companies with up to 50 employees.
17. Chicago Small Business Resiliency Loan Fund
This $100 million fund provides low-interest loans to Chicago-based businesses.
18. Los Angeles Small Business Emergency Microloan Program
Los Angeles-based businesses can apply for loans ranging from $5,000 to $20,000, with interest rates ranging from 0% to 3%.
19. Sacramento Economic Relief Fund
This $1 million fund provides zero-interest loans of up to $25,000 for Sacramento-based businesses.
20. San Diego Small Business Relief Package
This $6 million fund offers microloans ranging from $10,000 to $20,000 to San Diego-based businesses with up to 100 employees.
21. Salt Lake City Emergency Loan Program
Salt Lake City-based businesses can apply for zero-interest loans of up to $20,000.
22. Florida State Small Business Emergency Bridge Loan Program
This program provides loans of up to $50,000 with one-year terms to businesses with at least 2 and no more than 100 employees.
23. Massachusetts Small Business Recovery Loan Fund
This $10 million relief fund offers loans of up to $75,000 for companies with less than 50 employees, both full and part-time.
24. Minnesota Small Business Emergency Loans
Minnesota’s Department of Employment and Economic Development provides zero-interest loans ranging from $2,500 to $35,000.
25. New Mexico Covid-19 Business Loan Guarantee Program
New Mexico’s Economic Development Department is providing loans and lines of credit. The program can guarantee up to 80% of the loan and $50,000 of the credit line.
The following grants are unrelated to coronavirus:
What Are the Best Federal Business Grants?
Most federal small business grants go to companies in science, technology, energy, or healthcare. These companies tend to allocate significant funds to research and development, and the grants help cover the accompanying expenses.
Though the federal government determines eligibility requirements and the recipients of the grants, the money doesn’t come directly from them. Instead, the federal government distributes the money to state and local governments, assuming responsibility for giving the money to the recipients.
Here are the most well-known federal small business grants:
Small Business Innovation Research Program
The SBIR offers separate grants from eleven government agencies aiming to encourage scientific entrepreneurship. Recipients have established businesses currently researching some form of new technology with serious commercial potential. Each agency has its eligibility requirements, topics of interest, and application format. The minimum grant starts at $150,000, but businesses with exceptional success projections can reportedly access multiple rounds of funding for as much as $1 million.
Small Business Technology Transfer Program
The STTR bears several similarities with the SBIR. Still, at least one unique requirement sticks out: the recipient must use the funds to research in collaboration with a government agency. These agencies include NASA, the National Institute of Health, the Department of Energy, the Department of Defense, etc. Like the SBIR, each agency distributes its own STTR grant, and the funds come straight out of the agency’s budget. Recipients can access $150,000 to $1 million.
What Are the Best State Business Grants?
State-level small business grants usually offer less funding than federal grants, but the lower competition makes them much more accessible. Recipients tend to do work that directly impacts their communities and improves the economy of lower-income areas.
Many state-level grants are “matching” grants, which means that the recipient must use their funds to match the amount they receive. In other words, the state and the recipient invest the same amount of money in the initiative that won them the grant. Therefore, to win a matching grant, the state must believe that your initiative is worthy of a significant investment.
To search for state-level grants in your industry, visit the website for your state’s department of commerce or grants portal. While the following grants come from specific states, similar versions are offered by multiple states. These state-specific grants are just particularly accessible in their locations.
Arizona Commerce Authority
The Arizona Commerce Authority offers numerous programs, both old and new, every year. Among the most popular is the Arizona Step Grant, which is geared towards export businesses or basically any business looking to sell products overseas or establish international partnerships.
Arkansas Technology Transfer Assistance Grant Program
This grant is one of several that comes from the Arkansas Economic Development Commission, offering rebates and incentives. Recipients are Arkansas-based businesses that create local jobs or expand to other regions in the state. Businesses that specialize in creating full-time jobs, for example, can apply for the state’s Infrastructure Grant.
Colorado Export Development Grant
Colorado is one of the best states to start a business, partially because its government makes a conscious effort to stimulate growth in the science and technology sectors. Though Colorado offers grants for various industries, much of the funding goes to small and medium-sized businesses involved in robotics or engineering. Like Arkansas, Colorado also tends to favor businesses that are expanding overseas.
DC Small and Local Business Grant
Grants from the DC Department of Small and Local Businesses usually go to retail-oriented businesses located in inner-city neighborhoods. The department’s primary goal is to bring commerce to areas with weak local economies and little opportunity for entrepreneurs.
Idaho State Trade Expansion Program (STEP)
STEP programs can be found in many states, each with its eligibility requirements and application process. Every state also favors certain types of businesses. Idaho’s grants typically go to businesses looking to establish international partnerships. Sensing an overarching theme here?
Illinois Recycling Expansion and Modernization Program (REM)
Like STEP, multiple states have REM programs meant for businesses that work to improve statewide sustainability. Recipients can access up to $250,000, but it’s important to note that this is a matching grant program. Thus, to win the grant, you must be able to put up $250,000 (or however much you’re looking for) of your own money as well.
Iowa Business Development Grant Recycling
Iowa’s grants tend to go to businesses that create manufacturing jobs or aid in expanding budding, related industries. Some of the state’s grants are even reserved for retail businesses improving infrastructure by opening up shop in formerly decrepit buildings. To view the latest business development grants, visit Iowa’s grants portal.
Kansas Job Creation Fund
This funding program has relatively broad criteria: smaller businesses looking to expand their teams significantly. In most cases, portions of the grant are distributed over three years to finance multiple hiring stages.
Louisiana Community Development Block Grant
Louisiana’s Office of Community Development refurbishes residential buildings and improves economic opportunities in low-income areas. To apply, businesses must contact the state or local government branches typically associated with their industry. Businesses that have previously been affected by hurricanes or other weather-related incidents can also apply for special disaster recovery grants.
Maryland Child Care Quality Incentive Grant Program
This quarterly grant from the Maryland Division of Early Childhood Development goes to local childcare facilities that meet certain criteria. The most important requirements involve the economic backgrounds of the parents.
Maryland’s Department of Commerce awards this grant to small and mid-sized businesses looking to cut down on the costs of entering international markets.
Maryland Economic Development Assistance Authority & Fund
Many states offer nearly identical programs of this nature, but Maryland’s version has exceptionally broad criteria. The state also provides loans for businesses that meet the same requirements of the grant. However, the target industry and location changes with each grant cycle, so stay up to date by checking the priority funding areas.
Minnesota Dairy Business Planning Grant
As the name denotes, this program only goes to dairy farms or businesses that make equipment used by dairy farms. Highly-specific criteria mean less competition, so virtually all dairy-related businesses in Minnesota should at least consider applying.
The above acronym stands for Retaining Early Educators Through Attaining Incentives Now. A small grant, REETAIN goes to childcare professionals who have continued their own professional and educational development. In addition to training, the money can be used for supplies or any expense that could reduce your organization’s bottom line.
Minnesota Crop Research Grant Program
Most states offer their own Crop Grant Research Programs, which come from their Departments of Agriculture. Recipients must conduct research related to the quality, value, or production rate of agricultural products.
Minnesota Job Creation Fund
To qualify for the Minnesota Job Creation Fund, you must be a new or young business looking to hire more workers or renovate your physical property. Fulfilling these requirements can get you up to $1 million, which can also maintain high-salaried positions.
New York City Commute Enhancement Grant
The NYCCE grant awards up to $10,000 to small businesses involved in transportation to, from, or within New York City. The funds can be used for a variety of different initiatives, so any New York-based business that helps people commute in any way should apply.
North Carolina Recycling Business Development Grants
This annual grant from the Recycling Business Assistance Center helps finance growth-related investments for sustainability and waste reduction businesses. The funds cannot be used to cover operational costs, labor costs, or expenses associated with contract processing.
North Carolina IDEA
North Carolina-based startups should definitely consider applying to this grant, which has helped finance approximately 100 tech companies’ growth. Recipients can get up to $50,000, but their projections must show potential for major success. Different grants can be accessed by certain types of companies, like early-stage businesses or minority-owned businesses.
Tennessee Department of Economic & Community Development
Businesses that are ready to expand or are involved in improving public infrastructure can access numerous grants from the Tennessee DoECD. Your chances of winning will likely be higher if you are looking to finance employee training programs companies are located in a low-income area.
Texas Young Farmer Grant
Texas residents from 18 to 46 years of age can apply for this matching grant, which finances projects that strive to expand the state’s agricultural industry.
What are the Best Local Business Grants?
Unsurprisingly, grants from local governments and nonprofits offer less funding than state and federal options. But there’s less competition for smaller amounts. So, if your business has evidentially bolstered your local economy or created lots of jobs, you might have a pretty good shot at winning a local business grant. You’ll have even more grants to apply for if your business promotes environmental awareness or healthy living.
Like state-level options, local business grants tend to target businesses in certain types of locations. But while the following options come from specific cities, there’s probably one just like it in a city near you.
Cleveland Department of Economic Development
Cleveland is one of many cities that gives out several grants to businesses looking to expand or relocate to the city in question. Your city’s Department of Economic Development likely gives out equipment loans, working capital loans, and other traditional business financing products as well.
Job Creation Tax Abatements
Many cities offer tax incentives for businesses located in certain areas that help create jobs through their own initiatives. Though tax incentives don’t supply funds directly, they allow you to take home much more income, which you can then put towards growth.
Technology Business Grant Program
This Cleveland-based grant is available for tech businesses that create at least five jobs within the area. The funds cover 0.5% of the new employees’ payroll for up to five years.
Ben Franklin Innovation Partnership
Though this is technically a statewide program, it’s featured in the local category because it offers smaller loans to numerous science and technology businesses located in different Pennsylvania regions. Most recipients wish to qualify for the aforementioned SBIR and STTR federal grants but cannot afford the required research expenses.
Chicago Small Business Improvement Fund
This matching grant goes to businesses currently renovating their physical property or businesses that have recently purchased additional property for expansion in the same region. However, you wouldn’t receive the funds until you’ve completed and paid for your renovations or purchased your new property. The recipient would essentially make back the money they spent, which is where the “matching” aspect comes from.
Miami Mom & Pop Small Business Grant
This grant is meant for smaller, owned, and operated businesses and can be used for various purposes. In addition to purchasing equipment, inventory, building liability insurance, or security systems, recipients can put the funds towards launching marketing campaigns or minor physical renovations.
New York City Fashion Manufacturing Initiative (FMI)
New York City-based fashion companies can access several grants designed to purchase equipment, upgrade technology, finance employee training programs, or cover the costs of moving to another location within the five boroughs.
Lumpkin Foundation Grant
This private foundation provides grants to companies based in East Central Illinois. Recipients typically work in the foodservice or agriculture industry and promote sustainability, healthy eating, and environmental protection.
Orlando Downtown Commercial and Residential Building Improvement Program
Businesses looking to renovate their physical spaces in downtown Orlando can access grants valued from $15,000 to $120,000. The building must be located within the boundaries of the city’s Community Redevelopment Agency (CRA). This grant aims to improve downtown Orlando’s image to maintain commerce and raise property values in the area.
Salt Lake City River District Gardens Façade Improvement Grant
This relatively small grant is only available to businesses within Salt Lake City’s River District. Like the previous section’s grant, the funding comes from a larger initiative to improve the area’s image.
San Francisco Historic Preservation Grant
San Francisco’s Office of Economic and Workforce Development provides many grants and loans to entrepreneurs approaching different growth stages. This particular grant goes to businesses that do work related to preserving and rehabilitating historic structures. Recipients can use the funds for research, documentation, education, or feasibility studies.
What if I Can’t Qualify for a Small Business Grant?
As mentioned earlier, the convenience of grants makes them very difficult to qualify for. Though other funding options involve repayment and fees, there’s no comparison when it comes to accessibility. Anyone applying for a grant should at least have a backup plan they can rely on.
Here are a few other options if your grant applications don’t work out:
Crowdfunding allows you to simply pitch your product or service and wait for donations from the general public. Though you don’t have to pay any money back, most platforms take small cuts of the total amount you raise. Many crowdfunded businesses incentivized donations by offering coupons, discounts, free samples of the featured product, or additional services for no extra cost.
Short-Term Business Loans
Think of the traditional business term loan but with much shorter terms (as little as three to four months) and higher interest rates. Some institutions require weekly or daily payments instead of monthly payments. The higher interest rates stem from the significantly looser requirements regarding personal credit score, time in business, and annual revenue. If you work with an institution like United Capital Source, paying off your first loan on time will almost certainly make you eligible for additional rounds of funding with much more favorable terms. Depending on how well you meet the institution’s requirements, you can borrow anywhere from $5,000 to $500,000.
SBA Loans can offer the high amounts associated with grants for competitively low costs. It’s often easier to qualify for SBA Loans than traditional business term loans. Meeting the requirements for SBA Loans, however, still isn’t easy. You’ll need flawless personal credit, steady revenue and cash flow, and at least two years in business. There’s also lots of paperwork and a notoriously long waiting process. But if you believe you can get approved, the incomparable advantages of SBA Loans may greatly outweigh the time and effort involved in the application process.
Small Business Grants: Always Have A Plan B
Unlike business loans, failing to qualify for a grant is not an indication of poor performance. So, don’t let rejection hold you back from pursuing other options. You’ll almost certainly find something you can qualify for and safely afford without damaging cash flow. If you know how to manage debt, you’ll be able to grow your business with various forms of financing.
Opening Up America Again
Until we reach that moment where the environment is safe, we all need to be vigilant and work together for the common good. For those businesses that have been deemed essential or are included in one of the current opening phases, please look to this guide for advice on safe reopening.