Startup Grants & Incentives In The U.S.

In the United States, people have access to many grants and incentives for new startups, from federal and state issued grants, to grants offered by larger corporations to competition winners.

In this blog, we’ll take you through some new business startup incentives available in 2022, as well as a brief guide to what a startup grant usually entails.

Basically, startup grants are a form of financing, either from a private company or the state, aimed at helping businesses grow and innovate. Some instances include funding alongside some form of mentorship and support.

Grants issued by the government are far more common than private grants. Regardless, both involve an application process and a rigorous selection process. In this article, we’ll focus on some of the more prominent public grants and incentives that are available.

Public US grants and incentives that are best for startups 2022

The Small Business Innovation Research (SBIR) grant program

The Small Business Innovation Research (SBIR) grant program was launched to encourage small businesses and startups in the United States to work with the country’s search and development (R&D) which benefits government bodies and federal agencies.

The grant is monitored by the U.S. Small Business Administration (SBA), which is also known for overseeing SBA loans.

To be eligible for the grant, you must meet the following criteria:

• Be located in the United States

• Have a workforce of at least 50% US residents

• Be a for-profit organization

• Have no more than 500 employees in total

The Small Business Technology Transfer (STTR) program

The Small Business Technology Transfer (STTR) program shares many similarities with the SBIR program. Its motivations are exactly alike: funding SMEs who can contribute to research and development, which then can aid federal agencies in the future.

The main difference with the STTR program, however, is that it requires applicants to work with a non-profit research institution.

The Economic Development Administration (EDA) Build to Scale (B2S) program

The Economic Development Administration (EDA) is part of the US Department of Commerce and offers grants to startups and SMEs via their Build to Scale (B2S) program. The program consists of two separate awards given to winners of the Venture Challenge and the Capital Challenge. As well as a financial award, the grant also helps winners acquire hire new employees and get office space.

To participate in either competition, you must start by getting in contact with your local state government.

The Small Business Development Centers (SBDC) programs

The Small Business Development Centers have several programs formulated in partnership with the Small Business Administration (SBA) and, for the most part, alongside an academic institution like a university.

These programs consist of generous funding and the option to take business-related educational courses, mentorship, and the offer of free marketing.

Any startup or SME located in the United States can apply. To do so, you can contact your home state economic development agency and inquire about the SBDC program.

The Research and Development (R&D) tax credit incentive

The R&D tax credit incentive is a federal corporate tax incentive allowing SMEs to counterbalance part of their corporate taxes with research and development (R&D) expenses.

In the past, the US R&D tax credit could only be applied against corporate taxes; however, it recently has become available to startups, SMEs and medium-sized businesses.

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