How to find a grant
Many small business owners overlook the option of grants to fund projects, even though they provide non-repayable cash sums of thousands of pounds. They have a reputation for being bureaucratic, time-consuming and fiercely competitive. And some are - but there are plenty out there that are easier to obtain. You just need to know where to look.
What you can get a grant for
- Grants normally only apply to a specific project or aspect of your business rather than its overall development.
- The most common types of grant are for research and development (R&D), training employees, securing and creating jobs, innovation, conservation, or creating new green technology or reducing carbon emissions. There are, though, many other opportunities outside those categories. There are 6,000 grants available to UK businesses.
- Assess your needs before you start searching. Make an exacting assessment of how much money you need and precisely what for. It's much easier to find a grant for the area you need help in than changing your plans to suit a scheme you've just spotted.
Where to find a grant
- Consult your local Business Link advisor.
- Use online grant search databases. In the UK every database is powered by one of two parent search databases - GRANTfinder or j4b.
- Business Link grant search tool.
- You can search the j4b database at j4bgrants as well as here on Smarta.
- All will provide a list of up to about 20 results.
- It's unlikely you'll be eligible for all the schemes listed as your results. You need to look at the full criteria (which can be dozens of pages long), but you need to either pay or go elsewhere to access them.
- At this point, it's best to go to your Business Link advisor, your local council, your RDA or search online for help. Alternatively, you can use a consultant (see below).
- Get in touch with the provider of schemes directly to ask about your suitability.
What else you need to know when considering a grant
- Grants usually specify that work on a project can't be started yet.
- Confirmation that you've won any grant in the tens of thousands of pounds upwards is likely to take at least a month after submitting your application, and often up to four or five months. Check the wait time with the provider and determine whether your project can be postponed this long.
- The smaller a grant is, the quicker it will be.
- You need to be able to afford the grant. You almost always need to match grant funding- you provide generally around 50% of the total project cost and the grant makes up the other half. (In the public and community sectors you can sometimes match funds in kind, with labour.)
- Going for a smaller grant can help ease this financial pressure.
- You only get paid the grant after work has been completed so you also need to have enough in the bank to cover all costs until then.
- Find out when the grant money would actually be paid. Sometimes it's up to a year between winning a grant and receiving the money.
Using a grant consultant
- Using a grant consultant can save you time in your search and application and really increase your chances of winning a grant.
- They can also help advise you on how to financially plan for a grant.
- Consultants are unlikely to get involved with a grant worth less than about £20,000.
- They normally take about 10% commission, so you need to be sure you can afford that.
- Find out more about using grant consultants in our guide How to win a business grant.
What other free support is available?
Check out subsidies, where organisations offer reduced prices on certain products or services, or offer them for free. A free or subsidised consultancy is the same thing, but with consultancy work - the organisation pays a professional consultant for you.
Organisations and awarding bodies may offer free or discounted access to resources, useful R&D and manufacturing projects. The Ministry of Defence provides this for certain project.
Best practise and technology transfer can also help. This is where more experienced companies pass down their insights to more fledgeling businesses. There are now a fair number or organisations offering this. Try Investors in People or ISO 9000 for best practice initiatives. The government offers technology transfer.
Consult advisors at your local enterprise hub if you have one too.
Direct grant: cash awards you don't have to pay back (although you usually have to match part or all funding).
Repayable grant: funding you need to pay back out of future revenues. It differs from a loan because anything you owe is written off if your project fails or you don't make enough revenue.
Soft loan: you do have to pay this back but repayment conditions are much easier-going (softer) than for a commercial loan. E.g. the interest rate is less, there's no interest, the repayment period is longer.
Packaged assistance: you get different types of support, with the overall package designed specifically to meet your needs.
Smarta Business Builder
To help you on your business journey, we've created Smarta Business Builder, the complete online tools package for growing your business. Website Builder, Business Plans, Accounting Software, Legal Documents, and Email - all in one place - from just £20 per month with no contract! Try it out today.