Many small businesses overlook grants that are available for some small businesses to help fund start-up or expansion related expenses. And unlike loans, grants do not require repayment.
Many grant programs are funded through tax dollars, which makes many small business owners feel a little uneasy (and a few can be outright hostile toward any government funded programs). Some of these government programs, such as the SBIR program through the NIH that funds technology related R&D in small businesses, can potentially provide millions of dollars.
For those who are not interested in government hand-outs for their businesses, there are some private foundations that provide grants to small businesses. From the NFIB:
"(C)haritable organizations tend to be in favor of a particular cause, and if your business in any way furthers such a cause, the organizations will provide funding to help you.
"For example, if your small business sells environmentally-friendly products, you might try searching for environmental organizations and foundations to see if any are offering grants to businesses that stand for the same principles that they do.
"Likewise, industry associations might offer grants to small companies in that field. So if your small business is a technology company, for example, you'll want to check with all of the technology industry groups to find out whether there is any money allotted for small businesses that are just starting out.
"If you're a woman or a minority, you should check with organizations that are dedicated to business development within your community. Women business owners, for example, might find funds by checking with the Women's Business Center."
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