California Small Business Grants: The Top Options

Updated on September 14, 2020
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With the fifth-largest economy[1] in the world, California is without a doubt one of the most popular states in the country to own or start a small business. And because many small businesses operate in the Golden State, there are plenty of business financing options. Besides traditional business loans, there are also small business grants for California businesses that are worth exploring opportunities. However, when it comes to finding the best grant for your California business, you’ll need to plan ahead if you want to increase your chances of securing a business grant.

In this guide, we’ll discuss the best small business grants in California—from both state and national agencies—as well as the best way to find small business grants in your local area. We’ll also explain how to best position yourself when starting the grant application process. 

Top 6 Small Business Grants in California

When you’re trying to find the best small business grants in California, you should start locally, then broaden your search. A good first step is to check your city’s government website or state’s grant aggregator site for any available small business grants. Speaking to a counselor at your closest SBA Business Development Center is also a handy resource if you need help finding grants for your specific business needs.

Lastly, don’t discount applying to national grant programs. National grants tend to be more competitive; however, your business may be eligible to earn one. There are several nationally recognized small business grants for women and small business grants for minorities, so take advantage of your business’s unique characteristics. 

1. SBIR and STTR Programs

Operated by the SBA, the Small Business Innovation Research (SBIR) and Small Business Technology Transfer (STTR) programs award grants to small businesses that conduct research and development with the federal government. Eligible businesses must have technology that is eligible for commercialization and meets specific government needs. Only small businesses in the United States are eligible to apply for grant funding, and your business must have no more than 500 employees. The SBIR and STTR programs award grants from $50,000 to $250,000, and awardees have the opportunity to earn more funding down the line if they can prove the viability of their business.  

2. Rural Business Development Grant 

The California Rural Business Development Grant from the U.S. Department of Agriculture and Rural Development provides technical assistance and funding to small businesses in rural areas. If you’re a small business in an area with a population of less than 50,000, a rural business development grant can be a great way to start a business and provide job opportunities for the surrounding community.

A huge draw to getting a rural business development grant is that grants can range up to $500,000. To apply for a rural business development grant, your business cannot be located in a suburban area, and you must contact your local USDA’s rural development office. 

3. Calling All Dreamers Competition

The Calling All Dreamers contest is a retail business plan competition that awards aspiring entrepreneurs the chance to open a storefront in downtown Sacramento. The winner of the competition will receive up to $10,000 in matching funds and a comprehensive business service package that includes marketing, legal services, accounting, and more.

Experienced business owners looking to launch their first brick-and-mortar business in Sacramento are also welcome to apply. To enter the contest, you’ll need to share your business concept, submit a 60-second video pitch, and pay a $50 registration fee.

4. California GrantWatch

Because grants operate differently than traditional funding options, their availability is always in flux. To keep an eye on new opportunities, you can use Californa GrantWatch, a grant aggregator site that updates with the latest grant opportunities for businesses in California.

California GrantWatch publishes grants from foundations, organizations, and the local and federal government, so it’s a must-have resource when searching for California business grants. The site’s best-known feature is its proprietary search engine, which allows you to search for grants within certain parameters. You can also find a grant writer to assist you with researching and writing small business grant proposals. 

5. Amber Grant for Women 

The Amber Grant for Women is a well-known grant program for women business owners. Every month, one female entrepreneur is selected to win a $10,000 grant and is then eligible to receive the Amber Grant’s year-end $25,000 grant. In order to be considered for the Amber Grant, the business must be at least 50% woman-owned and for-profit.

Applying for an Amber Grant is a straightforward process. Unlike most government grants, you don’t need to submit a pile of lengthy documents. To apply for the grant, all you need to do is tell your business story, your plan on growing and starting your business, and how you intend to use the grant money. All applicants must pay a $15 application fee.

6. CalSeed Fund 

The California Sustainable Energy Entrepreneur Development Initiative (CalSEED) is a  grant program by the California Energy Commission and funded by the Electric Program Investment Charge. CalSEED awards over $150,000 in grant funding to clean energy small businesses. Awardees will be invited to exclusive workshops, networking events, and webinars.

Additionally, grant winners will also get the chance to participate in the annual Business Plan Competition by CleanTech Open for the chance to win an additional $450,000 in funding. Interested applicants must submit their applications online detailing their proposed innovations. 

How to Find the Right California Small Business Grant for You 

Finding the best California business grant is a matter of being selective about what opportunities you decide to pursue and how much time you spend on your applications. You’ll also want to give yourself enough time to review your application if you want to increase your chances of being successful. 

Plan out Your Application Timeline

Getting a California small business grant is a time-consuming process. You will need to carve out time to research the best small business grants for your business and write grant proposals. You’ll likely spend several days, if not weeks, compiling documents and running financial reports if you want to showcase your business in the best light.

Applying for grants can also be costly, especially if you plan on hiring an external consultant to help you with the application process. To apply for grants easily, don’t wait until the last minute. Consider starting a few weeks ahead of time so that you aren’t rushing to draft and revise your application. 

Understand Your Eligibility 

California business grants are highly competitive, so the more you know about your business’s qualifications, the better. You want to be certain that your business fits the grant program’s exact eligibility requirements. Make sure as you look into grant programs that you have a solid understanding of your business’s unique characteristics and needs.

Here’s what you need to know about your business:

  • Whether you identify with any underserved groups (women, minorities, veterans, etc.)
  • Your industry 
  • Whether your business is for-profit or nonprofit
  • How you plan on using the grant money
  • Your company’s goals and mission 
  • How many jobs you can create with your grant (if applicable)
  • The local areas to which you belong (state, county, community, etc.)
  • The size of your project
  • Whom your company serves and affects

When you apply for government grants, keep in mind that the more your business is able to solve a specific problem within the community, the better chances you have of securing the grant. 

Write a Solid Grant Proposal

Writing a good grant proposal is like writing a business plan, but in this case, you’re trying to convince a committee that your business deserves funding. When you’re writing a grant proposal, you have to clearly state how and why your business aligns with the grant organization’s mission and purpose. You’ll also need to write an executive summary of the scope of your business funding needs and a detailed account of how you plan on using the grant money. As a rule, you should also put down the exact amount you need for your business. You may want to hire an accountant or bookkeeper who can assist you with those calculations.

When writing a grant proposal, you generally need to include the following components:

  • Cover letter
  • Table of contents 
  • Executive summary
  • Problem statement 
  • Goals 
  • Timeline 

Remember, this is a general description of what a grant proposal requires. You may not have to write a comprehensive proposal for each grant application, depending on the organization. 

The Bottom Line

Now that you know how to find the best California business grants and the art of submitting grant proposals, finding the best funding opportunity for your business should be a breeze. But remember, winning grant awards takes more than finding the right grants and writing a good proposal. You also need persistence and frankly, a lot of luck. However, even if you have trouble getting a small business grant in California, you can always reapply again at a later date or wait for new grant opportunities to come up. 

If you’re open to other forms of financing, it’s worth looking into different small business financing options. Although they aren’t free, some business loans can be relatively affordable—and access to funding can be faster than applying to grant programs. Check out SBA loans or microloans if you’re interested in securing financing with low interest rates and reasonable terms. 

Article sources: 

  1. “World Economic Outlook Report
Zoe Weisner
Contributing Writer at Fundera

Zoe Weisner

Zoe Weisner is a contributing writer at Fundera. Previously, Zoe worked at BlueVine, a fintech startup that provides working capital to small businesses. At BlueVine, Zoe worked with small business owners to understand their financial needs and wrote content about small business-related topics, including marketing, business operations, and small business financing. Today, Zoe writes articles about personal finance, small business, and banking.

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