Discover grants for minority-owned businesses
You’ll need a registered business entity to apply for most grants. Tell us about your business, and we’ll help match you to grant opportunities—for free.
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The Complete Guide to Minority-Owned Business Grants
For many minority-owned businesses, finding funding can be difficult. Studies suggest that Black entrepreneurs are three times more likely to be denied a business loan than white entrepreneurs with similar credit and financial profiles. Grants, especially grants for minority-owned businesses, can help close the gap and make it easier for qualifying businesses to get the money they need.
The Complete Guide to Minority-Owned Business Grants
For many minority-owned businesses, finding funding can be difficult. Studies suggest that Black entrepreneurs are three times more likely to be denied a business loan than white entrepreneurs with similar credit and financial profiles. Grants, especially grants for minority-owned businesses, can help close the gap and make it easier for qualifying businesses to get the money they need.
Key takeaways
Grants are funds that you typically don’t have to repay as long as you meet the grant criteria and follow the conditions of the grant.
Grants let you keep full ownership of your business and don’t charge interest, so you can keep more of your business’ profits.
There are federal, state, corporate, and nonprofit grant programs for minority-owned businesses.
Grants are highly competitive, so preparing your application and targeting the right grant programs can help you be more successful.
Read on to learn more about grants and how to identify the right one for your business.
What are minority-owned business grants?
A minority-owned business grant is a funding alternative that gives qualifying business owners access to money they don’t have to repay over time. Grants are available to a wide variety of businesses, but some grants are specifically designed to support minority-owned entrepreneurship.
Unlike a loan, grants have no interest and no equity exchange or collateral requirements. Think of it as an investment in your business by a government agency, corporation, or nonprofit that wants to see minority entrepreneurs succeed.
Why should you apply for small business grants?
When you apply for a small business grant, you’re not taking on debt. You’re getting money that, in most cases, you won’t have to pay back. Here are a few reasons to consider applying for grants now.
Grants are equity-free funding. You don’t have to give the grantor a stake or interest in your company.
You could boost your business’ credibility. Winning a grant from a prestigious organization can signal legitimacy to future investors, lenders, and customers.
Grants reduce your financial risk. Grants keep your overall debt levels lower, making it easier to manage cash flow and grow sustainably.
You can apply to more than one grant program at once. There are no restrictions on the number of grants you can apply for at any given time.
What's the difference between a business grant and a loan?
Grants and loans can both fund your business—but they work very differently. Understanding the distinction helps you build the right funding mix.
Grants
No repayment required
Highly competitive
Award amounts typically range from $500–$50,000
Use of funds must align with the grant’s purpose
Lengthy application process
Loans
Must be repaid with interest
More widely available
Larger amounts available
Flexible use of funds
Faster approval process
Requires creditworthiness
Many successful minority entrepreneurs use both grants for initial capital or specific projects and SBA loans or traditional loans from banks and credit unions. Combining financing options can help you get more money and may make it easier for you to reach your business goals.
What types of grants are available for minority-owned businesses?
Grants for minority-owned businesses can come from several sources. Each grant program has different eligibility requirements, award amounts, and application timelines, so it’s worth surveying the landscape before you start applying.
Federal programs
The federal government doesn’t offer many programs for minority-owned businesses, nor do they offer many grants. But several programs can help you get the funding you need.
Grants.gov. You can search Grants.gov to view different federal grant programs. Search for “minority businesses,” “minority-owned,” or “socially disadvantaged” and filter by agencies like the Small Business Administration (SBA).
The Minority Business Development Agency (MBDA). The Minority Business Development Agency doesn’t issue grants to individual businesses, but it can help connect you with a national network of business centers that offer consultations and ongoing support for minority entrepreneurs. These Business Centers can help you apply for grants that you may qualify for.
Small Business Innovation Research (SBIR) and STTR programs. While not minority-specific, these federally funded programs award competitive R&D grants of $50,000–$275,000 (Phase I) and up to $1.5M (Phase II) to small businesses developing innovative technology. Eleven federal agencies participate.
USDA programs for minority farmers and food businesses. The USDA 2501 Program funds outreach and technical assistance for socially disadvantaged farmers and ranchers, and the Value-Added Producer Grant (VAPG) supports minority-owned agricultural enterprises.
State-specific grants
Many states operate dedicated minority business grant programs through their economic development agencies. Because these programs attract fewer applications than national grants, they can be easier to win. Each state has different programs, so be sure to check the following:
Your state’s economic development office. Most states have lists of active grant programs for minority entrepreneurs. You’ll need to check with your state to see which programs are available in your area.
Your city or county. Depending on where you live, you may also be able to get grants from local organizations or local governments. Contact your city’s small business office to learn more about the programs available in your area.
Regional MBDA Business Centers. As mentioned above, you may be able to use the MDBA’s Business Centers in your area to connect with local grant opportunities. You’ll also get ongoing support through these Centers at no cost.
Corporate grants
Corporate grant programs are managed by companies that want to help other businesses grow. These grants typically have shorter application windows, making it easier to apply throughout the year. New grants are opening all the time, so be sure to do your research and use tools, like LegalZoom’s grant search tool to see which grants are available and which you’re likely to qualify for.
Nonprofit grants
A number of nonprofit organizations offer grants to minority-owned businesses. These grants are typically open to specific demographics of business owner rather than minorities as a whole. Many of these grants look for businesses with values or missions that align with the organization’s mission.
Who qualifies for minority-owned business grants?
Eligibility varies by grant, but most programs share a common set of baseline requirements. For instance, most programs require that at least 51% of your business be owned and actively managed by one or more individuals from a recognized minority group. Some grants require formal third-party certification, while others accept self-certification.
NMSDC certification: The National Minority Supplier Development Council issues the most widely recognized minority business certification. The process typically takes 60–90 days and requires annual renewal.
State minority business certifications: Many states issue their own certifications, which may be required for state and local grant programs. Requirements vary by state.
Self-certification: Many corporate and nonprofit grants simply ask you to attest that you meet the ownership threshold, no formal certification needed.
What documentation do you need to apply?
Every grant has its own requirements, but most programs ask for a combination of the following:
Business formation documents (articles of organization, operating agreement)
Business plan and financial projections
Tax returns and financial statements (typically 1–2 years)
Proof of minority ownership
Business licenses and permits
A written explanation of your business, your goals, and how you'd use the grant
Be sure to review the application requirements for each grant before you apply. If you forget to send in certain documentation, your application may be removed from consideration.
Let LegalZoom’s grant search tool help you find grants
Sort through different databases and read through resources from government websites to help you better understand the types of grants you may qualify for. But it can still take time to find grants you’re suited for.
LegalZoom’s grant search tool makes it easy to find grants you’re likely to qualify for.
Step 1: Enter your business’ information. Provide a general overview of your business in the “Business Description” box. Include your industry, your business, and your goals.
Step 2: Select your state. Enter the state in which your business is located or registered.
Step 3: Select your business type. If you’re running a business with the primary purpose of making money, choose “For-profit” in the “Business Type” field. If you’re opening a nonprofit organization, choose “Nonprofit.”
Step 4: Select your owner attribute(s). This option lets you share what type of business owner you are. If you’re just looking for small business grants for minority-owned businesses, choose the “Minority-owned” box. If you’re a minority woman founder, select “Woman-owned” as well. Choose as many as apply to your situation.
Step 5: Run the search. Once you’ve entered all the relevant information, click the “Find grants” button.
The search will show you the grants you’re likely to qualify for.
Tips for applying for minority-owned business grants
Competition for these grants can be tough, so tailor your application to each grant and make sure you’re familiar with the requirements.
Make sure your business is ready
Before you submit an application, confirm your paperwork and documentation are in order. Most programs prefer formally registered businesses, and some require it. Forming an LLC or corporation before you apply signals to grantors that you're a legitimate, stable entity ready to receive and manage funding.
Be selective about where you apply
Rather than applying to every grant you can find, focus on programs you're genuinely eligible for and that align with your business' mission, stage, and industry. Review the eligibility criteria carefully before investing time in an application.
Customize every application
Generic applications are easy to spot and easy to pass over. Read each grant's instructions carefully and make sure your narrative speaks directly to that program's goals and language. What makes your business unique? What community impact will these funds create? Answer these questions in a way that reviewers will find impactful.
Apply to multiple grants simultaneously
There's no restriction on applying to multiple grants at once. In fact, one of the most effective strategies for eventually winning funding is to treat grant applications as a portfolio by submitting to several programs simultaneously. Just be sure to tailor each application to each individual grant.
Do your due diligence
It’s a good idea to research the grantor you’re applying with before sending them your information. Unfortunately, scammers may pose as seemingly legitimate grantors or programs and could gain access to your business’ sensitive information. Make sure the organization is legitimate and that the grant is real before sending your information.
How LegalZoom can help
LegalZoom doesn’t issue grants to any small business owner, no matter what industry you’re in or demographic you fit. However, we can help you get your business registered and organized so your grant applications are as strong as possible.
Business formation
Our business formation services can help you create an LLC, nonprofit organization, corporation, or sole proprietorship, no matter your state. As your business grows, LegalZoom can help you with compliance and staying on top of important deadlines.
Stay in good standing
Our Business Manager service manages your business’ compliance efforts and pairs you with a dedicated assistant focused on your business’ needs. When you use this service, you get:
Unlimited phone and email access to your compliance partner
Regular check-ins to identify gaps and risks
A compliance assessment and plan of action
End-to-end management of compliance filings
Keeping your business in compliance helps you look professional and reassures grant issuers that your business is stable and reliable.
Get legal help
Our Business Attorney Plans provide access to dedicated business attorneys and unlimited 30-minute phone consultations about new legal issues. Your attorney can review your business documents, answer legal questions, and connect you with essential tools.
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Frequently asked questions
Do I need to be certified as a minority-owned business to apply for grants?
It depends on the specific grant. Federal programs and many corporate grants require official certification through the NMSDC or a state agency, which typically takes 60 to 90 days. However, many corporate and nonprofit grants accept self-certification. You simply attest that your business meets the 51%+ ownership threshold. Always check each grant's eligibility requirements before applying.
Can minority-owned startups with no revenue apply for grants?
Yes. Many grants specifically target early-stage businesses and pre-revenue startups. Look for programs that explicitly mention "startup," "pre-revenue," or "early-stage" in their eligibility criteria. Established business grants typically require one to two years of operating history and revenue documentation.
Can I apply for multiple minority business grants at the same time?
Absolutely, and it's the recommended strategy. There are no restrictions on applying to multiple grants simultaneously. Successful grant recipients often apply to 10 or more programs before winning funding. Just ensure you can fulfill each program's requirements if you win more than one, and disclose other funding sources if applications ask.
How long does it take to receive grant money after approval?
It varies by grant type. Corporate grants often disburse within 30 to 60 days of the announcement. Federal grants can take 90 to 180 days due to contracting and compliance requirements. Nonprofit grants typically fall in between 45 and 90 days.
What's the average minority business grant amount?
Grant amounts vary widely by source. Micro-grants range from $500 to $5,000. Corporate grants typically offer $10,000 to $50,000. Federal competitive grants, like SBIR, can reach $50,000 to $275,000 at Phase I. The median amount across most minority business programs is approximately $10,000 to $25,000.
Do minority business grants have to be repaid if my business fails?
True grants typically don’t require repayment, regardless of business outcomes. However, read your terms carefully. Some programs marketed as "grants" are actually forgivable loans that only convert to grants if you meet specific conditions, like staying in business for a set period. If repayment is mentioned anywhere in the terms, it is not a pure grant.
Are minority business grants taxable?
Generally, yes. Most grants are considered taxable business income and must be reported to the IRS. However, you can typically deduct qualifying business expenses paid with grant funds, which often offsets the tax impact. Consult a tax professional for guidance specific to your situation.
