Writing a business grant proposal can be a great way to secure funding for your endeavors, but it can also be intimidating if the application process is as long as it is complicated. Just how can you define your company to an inundated decision-maker?
The best way to get started is to realize that your application has to connect with the reader. That means that using fancy or technical language may not always be a good choice. Here, we’ll look at not just how grants work, but what you can do to write each section in a way that sticks.
What are grants?
Grants give businesses support without asking the business for anything in return. They often come in phases as your company moves from early- to late-stage development. Unlike venture capitalists, creditors, or lenders, grants for small businesses don’t require you to pay back the money or give up a stake in your company. As you might imagine, grants are a good way to alleviate pressure — especially for a startup.
The downside is that you can devote countless hours to applying for these highly competitive resources with no guarantees of success. Plus, if you do win, it’s not exactly free money. You’ll still have to follow the rules and deadlines of the grants to reap the full rewards, such as submitting full progress reports after Phase I.
It’s worth noting that grants do not always provide straight cash. In some cases, they may offer infrastructure, partnership opportunities, or expert advice. For example, a tech company might apply for a grant that offers a free house to live in while the team develops a proof-of-concept.
Grants can be offered by anyone, including federal, state, private, and nonprofit organizations. They can also change at any given time depending on funding shifts or external influences. Grant winners are usually chosen based on very specific criteria. For example, a city might offer a grant to a sustainable concrete producer that can show how they’ll reduce greenhouse emissions by 50% or more.
What is grant writing?
Grant writing refers to how you portray your company in your application. You have to show who your team is, what the business does, and how exactly you’ll use the funds to fulfill your mission.
Grant writing is different than pitching to investors or lenders, who are generally more concerned with profit margins, or appealing to creditors. With grant writing, you’re stating how your company will impact your industry and the larger world. For example, a pharmaceutical company developing a dementia drug might win a grant based on their ability to show how that drug would improve a patient’s quality of life.
What is a business grant proposal?
A business grant proposal refers to the structure of your request for funding or support. If you’re wondering how to write a proposal letter for a business grant, you’ll need to consider your audience.
Some organizations want the bare bones, which means you’ll want to provide short, concise answers. Others will have multiple sections that you’ll need to provide thoughtful answers to. While most grant proposals come in the form of online applications, some organizations may request proposal letters or PDF uploads. Make sure to follow all directions, including proper formatting, to secure your eligibility.
How to write a grant proposal for a small business
Here, we’ll look at the basic steps of writing a proposal, and how a small business can best use each section to their advantage.
Step 1: Understand the grant requirements
The rules of the grant, including the deadlines, word limits, and required documents, are an important place to start. Keep in mind that some grants are extremely specific about what they want, while others will be more open to interpretation. It can help to research past winners and ask if or how their mission might be parallel to yours. However, you’ll also want to develop arguments and supporting points that clearly show why you’re a strong candidate — even if you have an entirely new idea.
Step 2: Introduce your business clearly
You’ll want to state, in plain English, what your business does, who it helps, and why you formed it. Grant writers don’t need to be novelists, but the best ones usually incorporate some storytelling. For example, you might succinctly share that you started a fintech company after you saw how difficult it was for a family member to be approved for a home loan.
Step 3: Define the problem or need
Your introduction should touch on the problem or need that you serve. From there, you can talk more about the implications of the problem that you hope to solve. For example, if you’re developing a new DIY accounting software, you might discuss how 25% of struggling business owners in the US end up overpaying for their taxes and how this hurts their larger communities.
Step 4: Explain exactly how the funds will be used
Break down how each dollar will be spent and tie it to direct outcomes. Avoid broad categories like salary or marketing. Instead, detail how you expect to allocate your funds in a way that prioritizes the larger mission. For example, you might say that a third of the grant will go towards hiring a talented engineer to build the underlying protocol of a new software program.
Step 5: Describe the expected impact
Describe how you think the awards will directly support your intentions. Whether that’s community impact, economic growth, or innovation, you need to connect the support to your goal. In this section, use realistic terms and avoid generalities. So, instead of saying that you intend to make the world a better place, you might explain how your company will improve air and water quality by 15% in your state. Not only is this specific, it also speaks to how it’s possible to make incremental changes in an effort to create a brighter future.
How to write a proposal letter for a business grant
A proposal letter is a short-form version of a full proposal, and they’re usually used for first-round screenings or smaller grants. Here are a few things to keep in mind as you sum up the introductions and explanations:
- Proposal letters are not necessarily about cutting filler words, as there should be no filler words even in a full grant proposal. Instead, clip your examples, use shorter sentences, and get straight to the point.
- Keep your proposal letters at one page or less. Use direct language and make sure that you cover the key bullet points: who your company is, what you aim to solve, how you’ll use the money, and who it will help.
Common mistakes in small business grant writing
The most common mistakes include:
- Misunderstanding eligibility requirements: From missed deadlines to mission misalignments, businesses can quickly disqualify themselves right off the bat — especially for the most competitive grants. Make sure you follow the instructions to the letter, whether it’s word-limits or budget outlines.
- General language: Companies often hire grant writers because they know how to create a clean story built on facts rather than reiterating vague goals or promises that are easily dismissed. When in doubt, strip down your sentences so they say as much as possible without overdoing it.
- Reusing the same proposal: Ensure that your grant writing is specifically for the grant that you’re applying to. It’s common for business owners to copy and paste — and miss a key sentence or detail that is clearly intended for a different audience.
- Overpromising: Many grant organizations will give money in installments, and they’ll require you to show your progress from stage to stage. If you’re missing your intended goals, it could be grounds for a withdrawal of the support. Make sure that you have clear plans in place to deliver on your promises, and list potential contingencies for common obstacles.
AI for grant writing
Grant writing AI can be used as a support tool for grant writing, though you cannot use it as a replacement for real information. We’ll look at how it can help as well as its limitations.
How grant writing AI can help
You can use grant writing for outlining, tone, grammar, and sentence structure. This can not only help you eliminate extraneous words, but also smooth out what you’re trying to say so there’s a logical flow. Decision-makers have to comb through seemingly endless grant applications, and AI can potentially help you map out each section in a way that stays with the reader.
Limitations of AI tools for grant writing
AI can help you with the writing, but it can’t supply numbers, impact claims, or data — at least not with any verification. Plus, you might be competing with hundreds (potentially thousands) of other corporations who used AI to help them write their own proposal, which can quickly cause the reader’s eyes to glaze over. Make sure that you include not just your business’s details, including history and impact, but also inject your own personality to the writing so it stands out.
What to do before submitting a business grant proposal
The best thing that you can do before submitting is to review the clarity and completeness. Ensure that every section is filled out and that all required documents are accounted for. You may also want to read through the instructions and eligibility requirements once more to ensure that you haven’t missed anything (and remember that you may be able to repurpose some of your content for future grants if you made an error).
Why having a registered business matters when applying for grants
Whether you’re operating alone or with a trusted team, many grants want applicants to prove they have a structured business, like an LLC or Corporation. You’ll also likely need an Employer Identification Number (EIN). And, even if you aren’t required to have this, it can potentially put you at a disadvantage if you don’t.
Most cash grants require you to have a business bank account, and many banks won’t grant you an account unless you’ve done your due diligence. When you have all of your paperwork in order and your business registered, you can clearly show how your company will receive and manage grant funds if you’re selected.
Platforms like Tailor Brands can help you lay your company’s foundation, so that you can open a business bank account, apply for grants, and manage your money. So, even if you’re not selected, you have the resources to pursue a different path (e.g., commercial loans, etc.).
Conclusion
Grant writing will get easier, but it requires a lot of patience. As with any type of writing, you’ll need a clear strategy about how to approach each application. Remember that you don’t have to be perfect, but that the right prep can make all the difference. From starting your business to writing cleaner sentences, a good strategy can help you save time as you get your business up and running.