When you are funding your business, it is important to decide how you wish to secure funding. There is a myriad of options available, from grants to loans and investors. Your choice of funding sources will depend on the stage of your business, on what collateral you must back up the loan, and on the strength of your business plan. Business grants can be difficult to find and apply for, but they are a fantastic tool for growing your enterprise.
Dr. Usha Rajagopal understands that it is challenging to fund a business while keeping your debt load low. Here are six reasons why it is better to apply for grants rather than loans.
Your Business Will Have Less Debt
If you can manage to secure grants, your business will have fewer obligations to the bank. A grant does not need to be repaid, and this infusion of cash can have positive impacts on your business. Grants can be more competitive than loans, but the extra hoops you need to jump through to receive them are entirely worth it.
You Will Be Able to Invest More in Your Business
If you are not spending extra money on interest, more of your profits can go right back into the business. Paying the banks to borrow money makes little sense when grants are available. When you receive a grant, you will be able to fund your business without wasting your hard-earned money on interest.
Grants are Tailored for Your Type of Business
Business grants are often targeted toward specific kinds of businesses which have a demonstrated financial need. For example, there are business grants intended for women-owned businesses, self-employed people, and veterans. The segmentation in the grants arena means that you should search for grants targeted at your business background.
Business Grants are for Deserving Companies
If your business benefits the public good through science, technology, or the medical field, it is worth looking into grants. If your business is not focused on the public good, it is less likely that you will be able to receive a grant. If you are eligible, you can be proud that you are making a special contribution to the world.
The Application Process Encourages Competition
Applying for a grant can be challenging. Since the process can be difficult, the pool of applicants will be much smaller. If you qualify for a business grant, be prepared to account for the way you spent the money. You may need to provide a business plan or a budget to the organization providing your grant. It is understandable that the organization giving you funding should be able to see that their money is well accounted for.
Take Pride in your Business
A grant shows that you have a special business that makes a meaningful contribution to the world. Take pride in your business and work toward making the world a better place. Dr. Usha Rajagopal offers a grant intended to encourage businesses to “go green.” If you qualify for this grant, you are encouraged to apply.