Small Business Grants

The most damaging myth in small business finance: that the Small Business Administration (SBA) gives out grants to start or run a business. It doesn't, and never has. The SBA provides loans, loan guarantees, and counseling — not cash grants for general business use.

That said, real grant funding does exist for U.S. small businesses. It's narrower and more competitive than the ads suggest. Here's what's actually out there in 2026.

Federal grant programs that exist

SBIR and STTR (Small Business Innovation Research / Technology Transfer) — historically the largest source of federal grants to small businesses, funding R&D across 11 federal agencies (DoD, NIH, NSF, DOE, USDA, NASA, and others). Awards go to for-profit small businesses (fewer than 500 employees) working on research with commercial potential.

These programs were reauthorized on April 13, 2026 after a brief lapse. Find current opportunities at SBIR.gov and Grants.gov.

USDA Rural Development grants — for agricultural businesses and businesses in qualifying rural areas, including Rural Business Development Grants and Value-Added Producer Grants. See rd.usda.gov.

SBA-funded community programs — the SBA does award grants, but mostly to nonprofit intermediaries (Small Business Development Centers, Women's Business Centers, Veterans Business Outreach Centers) that then provide free counseling and training to small businesses. Find your local center at sba.gov/local-assistance.

State Trade Expansion Program (STEP) — SBA-funded grants to states that pass through to small businesses entering or expanding into export markets.

What the SBA does provide (not grants, but worth knowing)

• SBA 7(a) loans — the SBA's flagship guaranteed loan program; up to $5 million for working capital, equipment, and expansion
• SBA 504 loans — long-term fixed-rate financing for real estate and major equipment
• SBA microloans — up to $50,000 for startups and small businesses; especially useful for businesses owned by women, minorities, and veterans
• Disaster loans — low-interest loans for businesses in federally declared disaster areas

State, local, and corporate grants

Many states, cities, and economic development agencies offer small grants for specific purposes — minority-owned businesses, businesses opening in distressed areas, businesses creating jobs in target industries. Check your state's economic development agency website.

Corporate and foundation grants (often $5,000–$50,000) are sometimes easier to win than federal grants because they're less competitive. Well-known examples: the Amber Grant for women entrepreneurs, the FedEx Small Business Grant Contest, and the Comcast RISE program.

The honest red-flag list

• Any "free government money" pitch promising grants for general business expenses, rent, or debt
• Anyone charging a fee to access "exclusive" SBA grants
• "Pre-approved" grant offers from federal agencies (the federal government does not contact you to award grants you didn't apply for)
• Cold calls or texts about grant money — Grants.gov never reaches out unsolicited

The FTC's full guidance is at consumer.ftc.gov/articles/government-grant-scams.

Where to actually apply

• Grants.gov — every federal grant opportunity
• SBIR.gov — R&D-focused grants
• SBA.gov — loans, counseling, and find your local district office
• Your state's economic development agency — for state and local programs