Minority business owners face challenges when starting or expanding a small business, including access to affordable small-business loans. Grants and financial assistance can help bridge the funding gap.
Here are some of the best small-business grants and other useful financing resources for minority-owned businesses. NerdWallet also has compiled a list of the best small-business loans for minorities.
- Grants.Gov: This website allows grant seekers to find and apply for federal funding opportunities. It contains information on more than 1,000 grant programs across all 26 federal grant-making agencies, including the Department of Commerce and the U.S. Small Business Administration.
- The USDA Rural Business Enterprise Grant Program: This is a grant for the development or expansion of small businesses in rural areas — minority or not. To qualify, you’ll need to have fewer than 50 employees, less than $1 million in revenue and be located in an eligible rural area. Grants range from $10,000 to $500,000.
- National Association for the Self-Employed: This is a nonprofit association that’s a good resource for all small-business owners. It provides educational resources and grants, and in 2015, it will have awarded more than $48,000 in grants to small businesses. To apply for a grant of up to $4,000, you’ll need to become an active member of the association, provide a detailed explanation of how you’ll use the funds, show how the grant will support your business growth, and provide some supporting documentation.
- FedEx Small Business Grant Contest: This annual grant contest by FedEx awards 10 small businesses with grants of up to $25,000. Any for-profit small business that has been in operation for at least six months is eligible to enter.
- Small-Business Innovation Research and Small Business Technology Transfer Programs: These two programs provide contracts and grants for startups that are looking to commercialize innovative biomedical technologies.
- Minority Business Development Agency: This agency of the U.S. Department of Commerce promotes the growth of minority-run small businesses by connecting owners to financing resources, federal contracts and market opportunities. The White House announced in August that the MBDA would partner with two organizations to launch the Minority Business Enterprise Technology Initiative, which aims to help aspiring technology entrepreneurs bring new products and services to market.
- National Minority Supplier Development Council: The council is a corporate member organization focused on increasing business opportunities for certified minority businesses. The council also operates the Business Consortium Fund, which offers a variety of financing programs and business advisory services for certified minority-owned businesses.
- SBA 8(a) Business Development Program: Socially or economically disadvantaged small-business owners are eligible to receive help through this Small Business Association program, which provides business development assistance, training workshops and management and technical guidance. To qualify, a small business must be at least 51% owned and controlled by a citizen who has been subjected to cultural bias or prejudice and placed at an economic disadvantage because of race or ethnicity.
- Operation HOPE Small-Business Empowerment Program: This program is designed for aspiring entrepreneurs in low-wealth neighborhoods, which often include minority communities. It provides access to small-business financing options, as well as help with setting up a business plan and financial statements, credit counseling and educational resources.
Find and compare small-business loans
If you’re looking for financing, NerdWallet has come up with a list of the best small-business loans to meet your needs and goals. We gauged lender trustworthiness, market scope and user experience, among other factors, and arranged them by categories that include your revenue and how long you’ve been in business.
Steve Nicastro is a staff writer at NerdWallet, a personal finance website. Email: Steven.N@nerdwallet.com. Twitter: @StevenNicastro.
For free, personalized answers to questions about financing your business, visit the Small Business section of NerdWallet’s Ask an Advisor page.
This post was updated. It was originally published Dec. 3, 2015.
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