Minority Grants For Small Business Start-ups-Free Money For Minorities

Minority Grants For Small Business Start-ups-Free Money For Minorities

Funding a business start-up is a major hurdle for most aspiring entrepreneurs. Many minority entrepreneurs give in to the appeal of minority grants in the belief that grant funds are available to help start minority businesses. In fact, minority business grants are more myth than reality. Government agencies do not have the legal authority to award grants for privately owned minority business start-ups and expansions.

Government Grant Basics

Federal and most state agency grants go primarily to fund programs serving a public purpose and that fit the activities of the granting agency. Some government grants help minorities attain necessary skills and training to be successful business operators. Others fund projects that stimulate economic development and job creation in under-served communities. Grant recipients are usually other government agencies, nonprofit organizations, educational institutions and for-profit companies skilled in business consulting.

Grant funds are available from the federal government for established small and minority businesses active in research and development. Small Business Innovation Research and Small Business Technology Transfer grants are intended to help fund small business research and development projects that advance the mission of the granting agency. SBIR and STTR grants always have strict federal performance and reporting guidelines.

Tax Law Snags

It is theoretically possible to find a foundation grant that funds minority business start-ups but highly improbable. Tax laws generally forbid foundations from awarding grants to for-profit businesses except for specific projects without jeopardizing the foundation's tax-exempt status.

Options for Funding Your Business Start-up

Professional advice on your financing options is available from reliable agencies, such as the Minority Business Development Agency and the Service Corps of Retired Executives. MBDA, part of the U.S. Department of Commerce, operates Minority Business Centers throughout the country. These agencies employ business consultants who are dedicated to helping minorities start and grow businesses. SCORE provides the same services as MBDA, but operates on a non-racial basis. According to its website, SCORE is a resource partner with the U.S. Small Business Administration and has been mentoring small business owners for more than 40 years.

Get Prepared

Assemble relevant information about yourself and your business proposition before meeting with one of the MBDA or SCORE consultants. At a minimum, you should have your personal financial information, including tax returns for the past three years and a business plan for your business start-up. Both MBDA and SCORE offer free business plan templates on their websites.

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Source - http://www.ehow.com/info_8353401_minority-grants-small-business-startups.html
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