Small business owners are becoming steadily more diverse. In 2018, the SBA’s Office of Advocacy reported 8 million minority-owned businesses in the U.S. Unfortunately, these owners are less likely to be approved for traditional loans, reports Forbes. Female business owners also receive 31% less in loan amounts than their male counterparts, according to a Biz2Credit study. To offset these setbacks, grant money for small business needs can be an excellent alternative resource, especially when you need an influx of cash to grow your business. These four women and minority small business grants can help:
1. Minority Business Development Agency
Run by the U.S. Department of Commerce, the Minority Business Development Agency (MBDA) supports the growth of minority-run small businesses. Each year, the agency connects business owners to financing resources, including grants.
- Where to apply: The MBDA grant competition website
- Amount available: Varies each year
- Requirements: Varies each year, although grants are always for minority business owners
2. The Amber Grant Foundation
The Amber Grant Foundation, named in memory of Amber Wigdahl who died at age 19 before she fulfilled her entrepreneurial dream, provides monthly and annual grants to women-owned businesses. Grants are awarded to entrepreneurs who demonstrate passion, business savvy and vision.
- Where to apply: Amber Grant Foundation website
- Amount available: $2,000 each month; monthly winners are eligible to receive the $25,000 annual award
- Requirements: Must be a female business owner operating in the U.S. or Canada; includes a $15 application fee
3. National Black MBA Association
The National Black MBA Association (NBMBAA) provides grants and prizes through its pitch challenge. Open to companies in the startup and early phase of launch, this event connects business owners with investors and venture capitalists. Participants must submit a 90-second elevator pitch to compete.
- Where to apply: NBMBAA Scale-Up Pitch Challenge website
- Amount available: Ranges from $1,000 to $50,000
- Requirements: Must have a founder who is black (of African descent) and who maintains at least equal ownership stake in the startup; must be an NBMBAA member
4. First Nations Development Institute
This nonprofit group helps Native Americans, Alaska Natives and Native Hawaiians through a variety of programs, including grants. They offer grant assistance programs to help you with your applications, and their grant programs vary depending on your background and location.
- Where to apply: First Nations Development Institute website
- Amount available: Varies
- Requirements: Must be a Native American, Alaska Native or Native Hawaiian and must serve a rural- or reservation-based community unless otherwise specified
Finding the Funds
With the growing number of minority-owned businesses comes a growing demand for funding. In addition to these women and minority small business grants, you can find more small business grants using the government-run Grants.gov. The site lists more than 1,000 grants, and you can search based on your region, business type and ownership.
While grant money for small business owners is one way to fund business needs, it’s not always guaranteed. But if you don’t receive a grant, or if a grant doesn’t cover all of your financial needs, other financing solutions can help. Alternative lenders are often willing to provide small business loans to women and minorities when traditional lenders aren’t, as these lenders take a more personal approach to understand a client’s business and their financial needs and limitations.
As small business owners, try to keep all your options open. Funding is out there; you just need to know where to look.