Grant sources for your start up business

For any start up business, the prime requirement is financial support. The biggest challenge faced by start ups is the lack of adequate funding for their business. To fund such developing companies, a lot of schemes are available nowadays. But, the task is in finding out the correct and trustworthy source of financial assistance. There have been initiatives from the side of Government as well as private companies in providing grants for entrepreneurs to promote and develop the business sector. You have to understand about the criteria of different grant schemes before getting your hands on it.

There are certain sources of start up grant, where entrepreneurs depend before going in for an agency.
Ø  People try to sell or mortgage their property. This is the most common source that people opt when thinking about start up loans.
Ø  The second option people consider is to borrow money from a friend or relative who is close to you and has trust in you.
Ø  The person checks his credit and use a considerable amount of money from his savings for business.
Ø  People go for a firm or bank that provides business start up money. Different banks have different interest rates and sometimes also provide offers in their rates. A bank with a convenient rate can be chosen.
Ø  Get a loan from another business group. There are different features available like women’s loan etc for different companies.
Ø  There can be business start up programs which are often sponsored by Government. Taking part in such programs can help you in getting the initial grant for your business. An added advantage in such programs is that you can meet up with big business tycoons who will assist and mentor you about different business plans.
Ø  You can try to find investors for your business. It can be a difficult job, but can be a good source to get an initial capital.
Ø  Last but not the least; people opt for Govt or Non Govt organizations to get the grant.

How do the grants help entrepreneurs?
The different programs available for funding start ups are
Ø  Cash grants
Ø  Tax incentives
Ø  Debt financing
Ø  Government aided financing
Cash grants are provided by Govt. and Non-Govt. organizations and each has different terms and conditions. There are certain criteria for qualifying for this grant and the disbursement techniques vary for different organizations. Only a fixed percentage of cash grant will be provided. The owner has to make the rest of the money by himself.
Tax incentives or tax benefits are provided to start up companies depending on certain rules. This can be a motivation for the entrepreneur to start more and more business deals.
Debt financing is made available to the start up owner so that he can get a required amount without giving up his profit share. These debts must be correctly repaid by the owner, even if he makes a profit in his business or not. This can prove as a disadvantage of debt financing at times.
Govt. aided financing is given as an exchange for an ownership share in the startup company. This can be very helpful for a business during its initial period.
Many startups are coming up everyday like mushrooms. Only if proper funding is given to these companies, can the country achieve economic growth.

Where to look for grants?
Before applying for a grant, you have to do good research about the different sources of grants available and choose a perfect one for you that can help you for your business. Some of the sources are
Ø  Federal Domestic Assistance provides grants for business purposes. So, it is better that you go through its catalogue for a better detail about the different grants.
Ø  Government has its own website where you can find out about the grant schemes and apply for them.
Ø  Federal register is also a good source to know about various federal grants.
Ø  All agencies use FedBizOpps to let the public know about various contract details. So, they can act as a good source to check for grants.
Small Business Investment Company (SBIC) provides financing to small business start ups through various programs. It is an investment firm that is managed and owned privately. They provide finance for start ups and help to put in capital for venturing business firms. There are other private firms which help SBIC in finding out the seed money for providing such grants. Some of them are Apple computers and America online.
You can also opt private firms when choosing the grant. There are good private companies like Foundation Center and the Council on Foundations providing financial support for start up businessmen.

What are the stumbling blocks for getting a grant?
There are many troubles which can come your way while looking for a proper grant scheme for your start up business.
Ø  Start up loans can have very hectic procedures and formalities that you will have to undergo patiently. The formalities can change within states, counties or cities. You have to carefully read the conditions needed for the application for loans.
Ø  It is better if you consult with a franchiser about what schemes are good for your kind of business. Do find an approved lender in order to avoid risks of legality and interest rates.
Small business grants are sometimes extremely difficult to find. But, once you find a correct scheme, it is going to be a grand beginning for your business. There are firms that provide grants in demand of a quick return as well as those who provide it with a convenient repayment time. Business ventures that are at their early stage have ample opportunities available for getting a grant to boost their business. But, most of the time, it can be a hard job to find out a reliable and economic source from them.
Do some research based on the above tips while selecting a grant for your start up and make your business a grand success.