Grant Myths & Facts
The three most common – and reliable – methods of startup funding are self funding, friends and family, and traditional loan products. However; whenever we talk with entrepreneurs about funding opportunities for their businesses, the question of grants is a hot topic. In the case of for-profit startups especially, grant acquisition can prove quite difficult, if not out of reach.
The first step is to discuss your funding strategies with an SBDC consultant. Prepare for that conversation by learning the myths and facts of grants and setting realistic expectations about them.
- Anyone can get a grant
- Grants are fast and easy to get
- There is a lot of free money available
- You can use grant money however you want
- After you get a grant, your responsibility is over
- Grant programs often have strict eligibility requirements
- Submitting for a grant can take a lot of time and effort, and is very competitive
- Some grants require a dollar match on your part
- It can take a long time after application to receive grant funds
- There are limited numbers of grants and funds available
- Funding is primarily awarded to support specific activities or projects and is rare for for-profit ventures
- Most monetary and non-monetary grants are taxable
- Grants often require certain documented results and well as extensive data reporting after the fact
Avoid Grant Scams:
No legitimate [grantor] would ever call you and tell you that you qualify or have been approved for a grant for which you never applied. Con artists generally follow a familiar script to gain access to your bank accounts or to get you to make unnecessary one-time payments to them. Look and listen for these tell-tale lines:
- “This grant is guaranteed or your money back.”
- “You can’t get this information anywhere else.”
- “I just need your credit card or bank account number to hold this grant.”
- “We’ll do all the work. You just pay a processing fee.”
- “The grant will just cost you a one-time fee.”
- “You’ve been selected” or “you are eligible” to receive a grant.
