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Grants for your business

How to find and apply for suitable grant schemes

Quote�Virtually no grant will cover 100% of a project's funding�End Quote

Free money for your business often sounds as though it's too good to be true. Often it is. Occasionally, however, grants really are available.

Without wishing to appear negative, the first thing to bear in mind when looking for a grant for your business is that you might well not be eligible. One business advisor, who asked for anonymity, told us: "The first thing a start-up will ask, all too often, is whether there's a grant around for them. I ask them why there should be, hoping for an answer with some sort of criteria, and they shrug and say ‘just thought it was worth a try...'"

Indeed, the first thing you need to ascertain if you're looking for a grant to help your company is why you should be eligible. The first things to bear in mind are:

Virtually no grant will cover 100% of a project's funding. If your business is in a listed building and you want Lottery money to restore it, expect to be asked for 50 per cent from your own resources

Grants will cover specific items rather than general expenses

You will need to submit a formal business plan of exactly how you plan to use the money that comes in from a grant – and then of course you'll need an alternative business plan to cover you if your application for funding fails

Restrictions might well apply – you might need to have the project underway already, for example

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Identifying grants

Identifying which grant might apply to your business is therefore the second step. You need first to identify why exactly you want a grant. Remember, insufficient funds in your account is a business issue and applying for a grant might be your way of masking the problem subconsciously; ask yourself whether this really is something for which you ought to be applying for extra funds or whether in fact you're using this to dodge an income issue.

Your local Business Link will be happy to help identify any grants for which you might be eligible. The sorts of thing they will be looking at will include general grants for the following:


Export – UK Trade & Investment often makes grants to people wanting to export items

Joint research with academia

Environmental issues

There are also localised grants focusing on specific issues and again, Business Link is an excellent place to start looking. You can also search Microsoft's European Union Grants Advisor to find grants relevant to your business. The sorts of things the issuers of these grants will look for will include:

Location – both the UK and European governments will help with money if you are sending employment to a particularly deprived area. At the moment Cornwall, Merseyside, South Yorkshire and West Wales attract a lot of support

Specific industries sometimes attract funding, like rural diversification and tourism

Growing business rather than one-man-bands will often do better- municipal pursers want to give money to ventures which are creating employment

Local support including subsidised rent and rates are also frequently available

Finally, again at the risk of sounding negative, remember the most likely outcome of a grant application is a polite rebuff, and the safest way to look at grants is to have a second business plan that assumes an unsuccessful application.

What next?

Microsoft's European Union Grants Advisor will let you search for grants your business might be eligible for. Sign up now for Small Business+ to obtain access.

We've got information on lots of other sources of funding, including grants, venture capital and business angels.

Have you checked out our free newsletters? They're packed with the latest information about cashflow, funding and more. Find out more.

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