What grants does your small business qualify for?

Securing the right funding can be a game-changer for many small businesses, helping them invest in new digital tools or develop new products and services.

But the process can be tough, especially with so many other businesses competing for the same funds.

To help make the process easier, here’s what you need to know to overcome common obstacles and improve your chances of securing funding. But first, let’s start with the basics:

What is a grant?

Unlike loans, grants are funds given by governments, universities or other organizations and associations that you don’t have to pay back. They support various business projects like expanding your business, research and development, hiring and training employees, and investing in equipment or facilities.

However, the money is only given to a person or organization that meets certain eligibility criteria. The application process usually starts with responding to a Request for Proposal (RFP), which explains what the grant is for and what is needed to apply.

To create a strong application, businesses should fully understand the RFP, clearly outline their project goals, and show how their proposal meets the grant’s objectives. Detailed planning and budgeting are crucial to prove that the project is doable and will have a significant impact.

Rohit Mehta, the founder of DoGood Fundraising, an organization specializing in grant writing and funder research, says that while the application process can be challenging, knowing about available resources and suitable grants can make it easier and less time-consuming.

Understanding the different types of grants

Grants are available from the federal, provincial, and local governments, each offering different options for businesses.

Federal grants usually aim at broad economic goals, while provincial grants focus on regional needs. Local grants are often very specific, addressing community projects and local economic growth.

This variety of grants helps businesses find funding that fits their goals, whether it’s for expanding, investing in new technology, or entering new markets.

But applying for grants to get funding for your small business can feel “daunting”, Mehta says, especially “when the guidelines provided by organizations or governments are 10 to 20 pages long.”

These documents explain who can apply, how to apply, what documents you need, and how your application will be judged, so you need to make sure you are qualified as a business to apply.

How to successfully qualify for a business grant?

If you’re looking to apply for a grant, make sure your business is officially registered. Mehta says that’s one of the most common mistakes he sees, and it can easily be avoided.

Some grants, however, go a step further and require that a business have employees, even if it’s just a few.

“Payroll is something you should have for some of these grants…because the funder is paying your employees, and they need it to be well documented,” he says.

Another key requirement is that the business must be generating profit. As Mehta emphasizes, you should be a registered business, generating revenue, incurring expenses, and ideally already employing at least one individual, even part-time.

If the business doesn’t have any of these elements, then it likely won’t be eligible for many small business grants.

Other grants, however, have much more specific requirements, depending on the types of business targeted and the specific aims that they serve.

How hard is it to get a business grant in Canada?

Getting business grants in Canada can be tough for many small business owners. Here are some of the main challenges:

• Complexity and time investment: The application process is complicated and takes a lot of time. Businesses need to research and understand the details of different grant programs. If they don’t get it right, they might submit incomplete or incorrect applications, leading to rejections.
• Strategic planning and timing: Businesses need to match their project timelines with the schedules of funding programs. This is hard for small businesses that can’t plan far ahead. Knowing when to apply and how to align project milestones with grants is important.
• Eligibility and specificity: Grants have strict rules about who can apply and what the money can be used for, like hiring or expanding into new markets. Not all grants will fit a business’s needs, limiting the options.
• Competition and limited availability: There is a lot of competition for grants, and the available funds are limited. Application periods can be short, and the review process can take a long time, delaying important business projects. A strong application is needed to stand out.
• Resource constraints: Many businesses, especially smaller ones, might not have the resources or expertise to handle the grant application process. This can discourage them from applying, even though the grants could be very beneficial.

To overcome these challenges, businesses should do thorough research, plan strategically, and consider seeking expert help, Mehta suggests. This can improve their chances of getting the funding they need to grow as a business.

Mehta encourages businesses to actively conduct their own research.

"The top challenge is that many businesses just don't know about the grants that exist," he says, and those who do know feel like they won’t stand a chance given the competitive nature of grants.

"Just like scholarships go unclaimed in colleges and universities, many businesses often don't apply for grants or subsidies,” says Mehta. “Don't let intimidation or past rejections make you feel disheartened.”

Should you hire someone to apply on behalf of your business?

When deciding if you need a grant writer, think about how complicated the grant is. A grant writer does more than just fill out forms; they find opportunities, keep track of deadlines, and make sure you have all the right documents.

If you’re a solo entrepreneur or freelancer looking for a small amount of funding, you might be able to handle the application yourself. But for small to medium-sized businesses going after large grants that need detailed plans or blueprints, a grant writer can be very helpful.

“It saves you time and helps you determine whether an opportunity is a suitable fit or not,” says Mehta.

Additionally, he says working with a professional will give you insider knowledge, which will improve your chances of success.

Do you have to have business insurance before applying for grants?

While business insurance isn’t required when starting your business, the Ontario government highly recommends it, even for home-based businesses. Business insurance can protect your property, operations, and income.

For example, if you opt for business interruption insurance, it can help cover your expenses during an emergency when your business can’t operate temporarily. This insurance can pay for essential costs like bills, rent, and even your employees’ salaries, which most grants typically don’t cover.

However, commercial insurance is not mandatory for grant applications. The only mandatory insurance, says Mehta, is Workplace Safety and Insurance Board (WSIB) coverage.

In Ontario, some businesses in specific categories that have more than one employee are legally required to have Workplace Safety and Insurance Board (WSIB) coverage. Mehta says it's mandatory for independent operators, sole proprietors, partners in a partnership, and executive officers in construction corporations.

Keep in mind, however, that each province has its own workers’ safety board, so requirements can vary.  So, as long as your business is registered, has the legally required insurance, and is operational, you are ready to apply for grants.

Although the application process can be overwhelming, staying informed and proactive—such as by hiring a grant writer—can significantly improve your chances of securing the funding you need.

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