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Federal Grants for Small Business: Let the Government Help You


If you are looking for additional funding for your small business, consider the various federal grants for small business that are available. You can find a listing of most federal grants at Keep in mind that most federal grant money is awarded through state agencies and that you must meet certain criteria to be eligible for federal grants.

What is a Grant?

A federal grant is financial assistance, funded by the federal government, given to a business to carry out a public initiative or stimulate the economy in a certain way as authorized by the laws of the United States. Federal government business grants do not have to be repaid. The federal government does not give grant money to individuals for personal use.

Grant Categories and Agencies

In order to apply for federal grants for small business, you have to own a business that typically receives federal grant funds. There are over 1,000 programs offered by 26 federal grant-making agencies. Grant categories include agriculture, community development, education and training, food and nutrition, health, humanities, natural resources, science and technology, and transportation, to name a few. The National Science Foundation, The National Endowment for the Arts and The Department of Housing and Urban Development are 3 of the 26 agencies that distribute federal grants for small business.

Who is Eligible for Federal Grants?

While it's true that the majority of federal grant money is awarded to state and local governments, there are federal grants for small businesses meeting the size standards as set by the Small Business Administration. The maximum number of employees for wholesale trade industries is 100 employees. For manufacturing companies, the maximum is 500 employees. Annual revenue caps also vary from industry to industry with retail and service industry at $6 million, construction industries at $28.5 million, $12 million for special trades and $.75 million for agricultural industries. More information about size standards can be found at

Criteria for Federal Government Business Grants

Much federally funded small business grant money is set aside for women-owned and minority-owned small businesses. These grants specifically target women and minorities to encourage entrepreneurship, leadership and equality in small business. Other criteria for federal grants include restrictions on how the money is used. Many grants can only be used for research and development or to move an existing business into an underserved sector, not for startup costs like marketing, sales or real estate. The agency awarding the grant may also require your business to match the awarded grant funds with similar funds or with a small business loan.

If your small business meets the above eligibility requirements and criteria, if you are a 501c3 nonprofit or a minority, federal government business grants are an excellent source of funding. With over 1000 different programs to choose from, even with all of the restrictions, chances are good that you will find one that fits your business niche.

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