Minorities in the United States often have
significantly less opportunities for education and employment. For this
reason, a number of organizations provide support to entrepreneurs who
belong to minority groups, and some of this support comes in the form of
small business grants. They do so with the hope that successful
businesses run by minorities will help to create a paradigm of success
and growth for those groups.
Possible Funding Sources
Federal Government Grants
Contrary to what a number of “gurus” may say in order to sell their books or services, the U.S. federal government does not categorically give grants simply to help start or develop a business, whether that business is run by a minority or not. While grants are available, the federal government extends those grants for very specific purposes, and grant seekers must abide by the strict requirements specific to that grant. Some of these grants apply specifically to women and/or minorities, but the exact requirements and stipulations of each grant usually go above and beyond just that. For instance, a particular grant program may extend funds to small businesses owned by women or minorities – but only if it employs women and/or minorities in engineering or scientific work. The specific grant programs that are available frequently change. To search for federal grants available for your specific business, visit Grants.gov. However, realize that most such grants, rather than going toward individual entrepreneurs, tend to go toward non-profit organizations and educational institutions.State And Local Government Grants
While very few federal grants are available to individuals – minority or not – state and local governments frequently offer financial support for minority-owned small businesses. Again, these programs usually have specific requirements beyond the fact that they must be owned by minorities. For instance, a requirement may be that the business must operate in an area populated predominantly by minorities. To search for such grant opportunities, consult your local chamber of commerce.Private Organization Grants
In addition to government agencies, private organizations also provide grants for minority small businesses. Minority entrepreneurs may find small business grants that apply to them by visiting FoundationCenter.org, which hosts a database of private organizations that offer funding for various types of projects.Tips For Success
Writing A Business PlanWhether you intend to apply for a grant from a public or private entity, whenever people are handing out free money, there will be plenty of competition for that money. For that reason, the party issuing the grant is not simply going to give you a grant because you are an aspiring entrepreneur who happens to belong to an ethnic minority. Donors put money toward minority small businesses because they want to see successful minority small businesses. A grant will not lead to success if your business idea is not a good one or if you do not know how to run a business. Therefore, before applying for a grant, you must first prepare a complete and professional-looking business plan. For instructions on how to write an effective business plan, visit SCORE.org. There, you will find an entire section dedicated to business planning. Another valuable resource for business planning is the Small Business Administration.
When writing your business plan, give specific information about your business’s structure and operations and the market in which you intend to operate in order to show that you are a capable professional with a successful idea. While writing this plan, include a section on community involvement that shows how your business will improve opportunities for minorities, either by providing important services to them at a reasonable price or by employing them.
Writing A Grant Proposal
A grant proposal is a document that someone writes for the purpose of obtaining a grant. Such proposals are usually necessary, regardless of whether the donor is a government agency or a private entity. This proposal stands as the donor’s main method of distinguishing you from the other candidates. It will include some of the same information as your business plan. However, while the business plan focuses on the business’s plan and ability to succeed, the grant proposal focuses more on the altruistic aspect of the project. In the proposal, you must show three basic things:- Need. You must show that your small business is underfunded and that it would benefit significantly from a grant. For instance, if you come from an economically underprivileged background, make this evident in the grant proposal.
- Organization. You must show how your small business will run and how the funds will be used. This section will contain a significant amount of information from the business plan.
- Effect. You must show that your business’s success will make the world a better place. Specifically, show that it will improve the situation for people of minority ethnicities. This should expand on the community involvement section of your business plan.