Grant Match Funds Requirement

“Would all the people who want free money for their small business kindly form a line to the right please?” Wouldn’t you like to hear these words announced one afternoon from a loud speaker?

Don’t hold your breath.

valentine heart shape made by dollars isolatedEasy Grants is focused on helping small businesses have access to grants but the majority of the funds won’t go to an individual business. Instead the grants go to some type of intermediary on the businesses behalf.

For example, a chamber of commerce or the city government may apply for funds that end up helping the small business owner. The business owner won’t own the thing the grant paid for but it will be there for the business’ benefit.

We did a grant once for a really unique furniture manufacturing company. The people primarily made tables and chairs that you might see in a ski lodge. Their products have this rough-hewn look and the table legs seem like tree limbs. It’s pretty cool stuff.

The issue the manufacturer had was complaints from the log trucks that brought in their raw material. Their trucks were having a horrible time turning around in the parking lot to unload and the city streets were worn out and tearing up their trucks. It got so bad that the truckers issued an ultimatum: fix the streets or we aren’t coming back. The city empathized and wanted to do all they could to keep the jobs but the city just didn’t have the funds to do all the repair but the city got a grant to repair the streets and made the truckers happy and made the small business happy as well. Everybody’s happy. Keep in mind most grants require some type of matching funds. This means if there is a 80/20 match requirement the grant pays for 80% of the cost and 20% has to come from somewhere. And most often that “somewhere” is you the ultimate beneficiary of the funds.

Many times a local government or a non-profit like an economic development district will be glad to make the application for funds on behalf of a business in their community as long as “it doesn’t cost us anything”.

This is why you, as the beneficiary of the funds, needs to be prepared to put up the matching funds. There are VERY FEW 100% grants – so few that my counsel is pretend they don’t even exist. Would we all like to hear that message of “line up for the free money”? Sure but it isn’t going to happen. Putting up $200,000 in order to get $800,000 for a $1 million grant is good enough for most folks. The thing to keep in mind, and the question you need to ask, is do I have the match? Am I willing to put that money into the project?

If the answer is no then most likely you need to step out of line.

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