9 Grant Opportunities for Minority-Owned Small Businesses
Small businesses are vital to economic prosperity for countless reasons, but often the journey to business ownership requires an influx of capital when you’re starting out, when you’re scaling up or when you’re simply weathering an economic shift. Unfortunately, many entrepreneurs in minority communities may have trouble obtaining the investment capital to compete in a market where financial assistance isn’t always unbiased. This is where grants for minority-owned small businesses play an important role.
When angel investors aren’t plentiful and bank loans aren’t practical, grants offered by public, for-profit and nonprofit institutions to small business owners provide funding to sustain and expand companies with the added bonus of not having to be repaid. With minority-owned businesses growing at an accelerated rate, small business grants developed for underrepresented racial and ethnic communities in the U.S. have become a keystone to building a strong national economy that benefits us all.
Who Qualifies as a Minority-Owned Small Business?
From tech innovators in rural areas to savvy military veterans in the disabled community, entrepreneurs of underrepresented populations are in no short supply. However, minority-owned businesses are typically defined as companies employing 50 persons or less, majority-owned by a minority group member, as it relates to race, ethnicity, gender, physical disability or other socioeconomic designation. For now, let’s focus on racial and ethnic minorities in the U.S. small business community, but remember the programs mentioned below are by no means exhaustive as some are geared toward companies serving a specific need or industry, and new grant opportunities are launched every year.
9 Grants for Minority-Owned Small Businesses
Government funding opportunities like those found on Grants.gov are a popular source for searching for small business capital for entrepreneurs from all cultures and backgrounds, but a good rule of thumb is to start locally before branching out your search on a national level. If your city has a small business resource center or business development resource, search for grants for companies on a local level, as they typically have fewer applicants than a grant program available to entrepreneurs from all over the country.
Often city- and state-specific grant programs prefer applicants that have the potential to hire from the surrounding community.
Organizations like Miami’s Mom and Pop Small Business Grant and Cleveland’s Green Technology Business Grant are great examples of city-specific programs that offer small business funding, as well as access to entrepreneurial advice and alternative capital solutions. But if the city you call home doesn’t have a minority-focused initiative for small business grant opportunities, take a look at the selection below. The grant programs listed here aren’t limited to residence in a specific U.S. state or territory—and all aren't necessarily minority-only grants—but all of the grants listed below are great for minority small business owners looking to start, sustain or improve their enterprises.
A True Rising Tide
Minority-owned enterprises constitute 29 percent of America’s businesses, and the numbers are projected to increase exponentially by 2044. Yet, minority entrepreneurs are denied loans at a rate almost 3x higher than their non-minority counterparts. This is why grants are often one of the best ways to compensate for the very common challenge of acquiring capital investment that many minority-owned businesses face. Government grant programs are helpful, but it’s the work of private for-profit and nonprofit organizations that are truly instrumental in closing the gap.
By increasing entrepreneurship opportunities through financing to minority-owned businesses, the U.S. has the potential to see 9 million more jobs created and an increase in $300 billion of annual income introduced into the job market. And in that economic environment, all boats would rise with the tide.
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