Myth Buster

Posted by on October 17, 2012


Often we receive calls from potential entrepreneurs asking about grants to start their business.  For the most part, the answer is that you can’t find a grant to do so.  Our friends at the Kentucky Small Business Development Center shared with us a guide they developed to help clients decipher between credible funding programs and those that are a scam.


Ever hear the advertisements that guarantee you’ll get the grant or your money back?  Get step-by-step instructions on how to write that winning proposal?  Everyone is eligible!  Well, buyer beware, if it sounds too good to be true…chances are it is.


The fact is that no government agency is handing out free money to start small businesses, regardless of your gender, ethnicity or economic status.  Approximately 95% of small businesses are started with personal savings, loans from friends/family or commercial loans.  As an owner, you must have “skin in the game.”  Financing your start up at 100% is not an option. 


Grant offers that provide a money back guarantee can be designed so it is nearly impossible to meet all the requirements to get your money back.  It is also a red flag if you are being asked to pay any amount of money upfront to apply for a grant.  Normally, that is not the case.


The U.S. Small Business Administration (SBA) does not make grants to business owners but has several loan guarantee programs. Many local and state agencies and financial institutions offer loan programs, including the Economic Development Corporation (EDC) of the county of Marquette.   There are some government grants, such as the Small Business Innovative Research (SBIR) program, but they are very specific in nature, extremely competitive and have an intensive application process.


The Federal Trade Commission offers the following tips about grant funding:

  •   Be wary of anyone promising or guaranteeing they can get you a grant; particularly if you must pay a fee in advance
  • Check the Better Business Bureau (BBB) or the Attorney General’s office for complaints about the company making the claim to find you a grant
  •   Do not provide sensitive and/or personal information to someone you do not know
  • Remember, advertising in recognized media outlets or on the internet does NOT guarantee the legitimacy of the company sponsoring the ad (yes, not everything on the internet is the truth)



If you are interested in starting a company of your own, there is no substitution for a solid business plan and no amount of money will make a bad business idea work.  At the Lake Superior Community Partnership, with our extensive network and resources, we can provide you with the tools and guidance to get started on the right foot.  From selecting the right business location to financing options, and everything in between, our staff stands ready to assist. 


Check out our website (www.marquette.org) for details about our services or call 226-9658 today for an appointment with a qualified business development specialist.

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