by Kelly Hunter • 2020-01-18
It takes a lot of money to get a business up and running, and there are a lot of things that you can do to get the money that you need to start up your own business. Now, there are a few things that you need to know. First of all, business startup grants that the government offers are great This is a great way to get all the money you need to start your business. On the other hand, these kinds of grants are not easy to get. A lot of people feel you are better off getting loans and things that you have to pay back.
The only other question you may have about business startup grants is why they are so hard to get. That is because the government usually only gives federal grants to businesses that are going to be for a specific targeted group of people. Not only that, but a lot of times these grants are only given to people with specific requirements. Of course, if you are a nonprofit organization, you stand a good chance of getting grants as well. To fully understand grants, however, you have to understand the different kind of grants that you can get. Right now, we are going to talk about a few different ones.
First of all, there are the direct grants. This is given out like a cash award. Most of the time, there are certain activities that have to be done with this kind of grant money. Things like training, export development, or even a capital investment project are very popular. The only bad thing about the direct grant is that you are usually required to put up about 50% of all start up costs, meaning that you have to have some money to get started with this kind of grant. Other than that, these are great business startup grants.
A repayable grant is a great way to go as well. This is like a grant that has a safety net. Under this kind of grant, you are given a set amount of money to start a project with. Then as your revenue come in, you use a set amount of that to pay back the grant in full. The good news for the business owner is that if the business fails, then the grant is written off. This means that you no longer have to worry about paying it back. As you can guess, this is very good for you and bad for the government. That is why there are less of these given out than most grants.
If you still think that you are going to have problems paying off a repayable grant, then you may want to go with a soft loan. Despite the name, this is still a grant. However, the conditions on how you pay back the money are a lot more generous than the other kinds of loans, hence the name, soft loan. This is good for businesses that could have a hard time getting started.
As you can see, there are a lot of different grants out there, and this is just the tip of the iceberg. If you are looking to start up a business, a grant is the way to go. Just remember that they are not as easy to get as loans are.