Federal Grants for Small Businesses

Posted on by Kriti

Federal grants for small businesses are mostly given through non-profit organizations related to economic development and state and local programs for small business owners. Such businesses can be, for example, energy efficient technology related enterprises; tourism promotional campaigns and childcare center expansion. If you are fortunate enough to win a small business grant, please also keep in mind that such grants generally require the recipient to come up with other forms of financing such as a loan to combine the grant with, or to match funds in other ways. Of course, getting a small business grant is a windfall since they don’t have to be repaid.

As far as the U.S. Small Business Administration (SBA) is concerned, while it can provide grants to non-profit organizations and educational institutions (related to its counseling and training programs) it does not provide any grants for starting and expanding businesses. However, if your small business has a scientific research and development department, you could be eligible for federal grants under the Small Business Innovation Research (SBIR) and the Small Business Technology Transfer (STTR) programs are two other Federal grants for small businesses. These two programs are meant to support and encourage small business owners to undertake research and development that could lead to high commercial gains later. Eligibility requirements could also be met if the R& D projects of the small business meet federal R&D objectives.

The role of the U.S. Small Business Administration (SBA) for the SBIR program is as the coordinating agency which directs the implementation of SBIR by the concerned 11 agencies which designate R&D topics and accept proposals (Department of Agriculture, Department of Commerce, Department of Defense, Department of Education, Department of Energy, Department of Health and Human Services, Department of Homeland Security, Department of Transportation, Environmental Protection Agency, National Aeronautics and Space Administration, National Science Foundation). SBA reviews their progress and a report based on this is presented to Congress once a year. SBA also collects solicitation information from its participating agencies which is then published in a Pre-Solicitation Announcement (PSA) on a quarterly basis. The PSA is a very important publication because it is the only source for knowing about topics and probable release and closing dates for each agency’s solicitations. That is why all small business owners need to be upto date with the PSA so as not to miss out on a chance to win a federal small business grant through either the SBIR or the STTR Programs.

For more information on the SBIR Program, please contact: U.S. Small Business Administration Office of Technology 409 Third Street, SW Washington, DC 20416 (202) 205-6450

Small Business Innovation Research Program (SBIR)

SBIR is a highly competitive program that aims to stimulate high-tech innovation in the United States by encouraging qualified small businesses to make Research and Development (R&D) an integral part of their business and in doing so, widening the nation’s R&D area of activity. Understanding well that it is the entrepreneurial sector that is responsible for the most innovations, but that R&D is an expensive arena and often beyond the means of small businesses, SBIR hopes to counteract this anomaly by stepping in with its grant funding to help the entrepreneurs do so. In this way, SBIR makes it possible for small businesses to compete on a level playing field with bigger businesses. SBIR plays a crucial role during the startup and development stages. It also supports commercialization of the technology, product or service thus acquired through research and development.

To be eligible for SBIR, the small business must be an independently operated American-owned profit-generating enterprise with not more than 500 employees. The principal researcher must also be an employee of the concerned small business.




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