Here is a common situation: there is a great idea for starting your own business, there is also enthusiasm and a lot of energy for work, but there is no serious money to start a new business. For some reason you don’t want to consider the option of a bank loan or a loan from friends. Well, there is another way - this is a grant. What is a grant? We are talking about sponsorship for special purposes. If you want to know how to get a grant, read on.
Know: many business projects have been embodied precisely thanks to this form of financial support. Having decided to go the same way, be patient and get ready for a considerable effort. But believe me - the result is worth it.
And yet - what is a grant?
Nowadays, this word often appears in the media. Before we figure out how to get a grant, let's clarify the essence of the concept. A grant is understood as a type of targeted assistance expressed in money or in kind and aimed at specific goals, one of which may be the expansion or opening of a new business. Its main distinguishing feature in comparison with a loan or a loan is that it is a gratuitous subsidy. The grant does not require a return.
It can be issued by the state and private foundations or foreign organizations. And, as you understand, each of the listed sources has the right to put forward its own requirements. That is why it is not necessary to “throw” one’s application wherever there is at least some chance. Focus and choose the source that is most suitable for your field of activity. And then find out what conditions you have to fulfill.
What you need to know about getting a grant?
Decided to get a grant for business development? Before you start collecting documents, you must be sure that you have a complete understanding of how the system works, what nuances and pitfalls are here.
First of all, you must remember that the money is not given to you personally, but to your organization, so everything should go into the penny. You will have to compile reports about each waste.
Grants are different. Not all of them are allocated by the state. And in the state itself there are several organizations that consider different applications. Before submitting documents, carefully study what the grant is allocated for, and whether your project meets the requirements. If you are going to sell socks, it is foolish to hope that a fund will be allocated to you that is interested in developing the agricultural sector.
By submitting documents, you indicate the purpose of receiving the money and the required amount. If, after submitting the documents, you understand that the requested funds are not enough for you, it will not work to correct the error. Therefore, carefully calculate everything. But to ask for funds "with a margin" is not worth it. Firstly, the smaller the amount, the more likely it will be given to you. Secondly, for every penny you have to report, nothing extra should remain.
Realistically assess your chances. The originality and unusualness of the idea is, of course, a big plus. But along with this, your business should be useful. The state should understand that your company will give people jobs, bring profit to the budget in the form of taxes, and play a role in the development of the country's economy. If your business does not meet these parameters, it is better to save your time and look for money elsewhere.
Do not expect that the entire amount will be allocated to you immediately. Usually the money goes in tranches for each individual stage of the project. And each time you have to write reports about the spent funds.
Do not forget that for each amount received, citizens of the Russian Federation must pay income tax. Business development grants are no exception. And, if the state allocates money to you, there is one condition that you must remember about - your business must last at least 5 years. If the company falls apart earlier, money will have to be returned. Therefore, when applying for a grant, you need to be 100% confident in success.
What is a grant and how to get it
A grant is a sum of money to carry out work or produce a product that is given free of charge. In other words, a grant, unlike a loan, does not need to be given back. For a budding entrepreneur in need of funding, a grant is the perfect way to raise money for your project.
Each region sets its own list of industries covered by the grant system. For example, money can be allocated to a business in the field of social entrepreneurship, medicine, science.
Competitions for grants are arranged by the state, public private funds or foreign funds. The latter are more willing to work with people who have already turned to them for financial support and have developed a product with their help. State funds do not like to allocate money to pay salaries to employees, foreign in this regard is more loyal.
As for state grants, each entity chooses for itself the priority areas for which it is more willing to issue grants. For example, if the priority is agriculture, if there are two grants: one for agriculture and one for the opening of a restaurant, then the first will be given priority.
Documents required to receive a grant
Grant documents, in fact, do not require so many. Together with the application, you need to provide:
- Detailed business plan,
- Certificate of State Registration
- Certificate of entry in the register of business entities,
- Constituent documents of the organization (+ copies),
- Copy of passport (all pages).
How to get a grant from the state depending on the direction of activity
Entrepreneurs starting their business in the following areas can rely on financial assistance:
- agricultural (crop or livestock),
- processing industry,
- social projects
When registering an IP, you must specify the correct OKVED code that corresponds to the desired area of activity, otherwise the project will not be able to participate in the competition.
Overview of the main ways to get a business grant
Let’s figure out how to get a grant for business development or its opening. Domestic subsidies may be provided by business unions. The amount of regional grants can be up to half a million rubles, and any aspiring entrepreneur can count on their receipt.
- Skolkovo provides grants to promote science and technology.
- “Russian World” (culture and art),
- Foreign funds: UNESCO, UN provide financial assistance to the company of the entrepreneur, and not to the individual. For each stage of the implementation of the grant financial resources reporting is required.
If your activity corresponds to the direction of grants from these funds, submit an application on time. The application form and project requirements are described on the website of the respective fund.
How to get a grant for starting a business
Let’s figure out how to get a grant for starting a business from the state.
All segments of the population can apply for it, but priority is given to the following:
- last year students of universities
- single mothers
- persons who have been reduced at work, etc.
The application must specify a business plan with the exact amount of project costs. Most likely, you will be given anyway less than indicated in the application. If the project wins, then the businessman will not receive the money immediately, but after a few months.
When collecting documents, you cannot violate the “expiration date” of each paper. For example, a tax certificate is valid for 10 days, and a USRIP certificate is a month. The terms for receiving securities, respectively, are also different. Refusal to accept documents can only be obtained due to mismatch of the shelf life of the documents.
If you timely report on the use of funds to investors, follow all the advice and complete tasks, you can get new grants for business development and expansion of production. The funds received can only be spent on goals from the business plan. Otherwise, it will be considered “misuse of budget funds” - you can fall under the article.
As for the business plan, it is necessary to approach its preparation very carefully, analyze in detail the market, competitors and prospects for making a profit. Documents downloaded from the Internet will not work here.
How to get a grant for business development
An entrepreneur can win a grant if his business has existed for more than 12 months.
List of required documents for participation in the competition:
- Grant application.
- Business plan.
- Extract from the USRIP.
- Certified copies of documents for obtaining activity permits.
- Accounting reports on the financial condition of the enterprise.
- A copy of the form on the number of employees (if any).
- A certified copy of documents that the entrepreneur spent his own money on opening a case.
- A tax certificate stating that the company does not have debts.
- An accompanying letter explaining why your project should win.
- Copy of education certificate (university diploma or copy of certificate of completion of entrepreneurship courses).
The decision to issue money or to refuse subsidies is made by the tender committee. Its activities are regulated by the decision of the local government.
Tasks of the tender committee:
- consider the application and the documents attached to it,
- determine whether it meets all conditions,
- conduct an interview (in person),
- thoroughly analyze the relevance of the business plan,
- decide whether to include the applicant in the program,
- determine the winners
- initiate payments to the winner.
Documents must be provided by the applicant or an authorized person without violating the deadlines established by the application forms. You need to provide the whole package of papers without exception. Failure to comply with any requirement may serve as a reason for exclusion of the candidate from the grant program.
Composition of the tender commission:
- members of the commission.
Voters should not be personally interested in the victory of any candidate. For each candidate vote. Those with the most votes win.
If there is no money to start a business, the state can support it. The amount is usually not grandiose (from 50 to 500 thousand), but it can become a saving straw for a beginner. First, determine whether the area of your business is a priority for this region, then collect documents and apply. You can participate in competitions of both Russian funds and foreign. There are differences between them in terms of financing, the amount of subsidies and the reporting form.
A grant is usually available to young entrepreneurs (up to 35 years old). In case of failure, it is important to analyze your own mistakes - after that you can take part again.
Where exactly to apply?
To make the right choice among the three main categories of organizations listed above, one should clearly understand what each of them pursues.
State organizations are most likely to give grants for business development to representatives of those categories of the population who are commonly called socially unprotected. We are talking about graduates of universities, citizens who are registered at employment centers or who have been reduced, military retirees, people with disabilities, single mothers and young specialists.
You will not get the full amount necessary to open your own business from the state. Here, preference is given to those entrepreneurs who have their own funds (at least partially) and who are ready to invest them in this matter.
The preferred area for the sale of state money is social or industrial. Also, it is quite realistic to receive a grant for the development of agriculture. The state willingly finances the purchase of raw materials or equipment, but the future entrepreneur will most likely have to bear the costs of wages of hired workers on their own. Also in this case, the period of existence and operation of the enterprise is important. Under the terms of grants, it should not exceed a year or two. They also consider the entrepreneur’s ability to hire additional staff.
How grants are given by private and foreign funds
Such organizations have many reporting requirements. It is important for them to see that the money issued by a businessman is spent in a strictly defined way, and does not settle in his pocket. Unlike the state, these sponsors finance and pay salaries to employees.
In the case when it comes to financing innovations in the field of business or the economy, it is most reasonable to contact one of the private domestic funds. To request assistance from a foreign fund makes sense in the case of the option of opening or developing a business in the field of art, ecology, society, culture or the IT sphere. Most often, the issuance of grants in such funds takes place in the form of tranches, that is, each specific stage is implemented separately.
Together with the documents an application is submitted in a certain form. Application structure:
- Table of contents,
- Short summary
- Description of the problem that the business will solve
- Project objectives and methods for solving them,
- Possible risks
- Amount Required
- Applications (charts, tables, graphs, etc., if any).
You can attach a cover letter to the list of documents that explains why your business is so important. This letter will increase your chances.
What documents are needed
The list of such will be individual for each organization that finances and supports the business, but their list is often very similar. So what can they ask of you?
1. A duly executed application for participation in the selection, which is held among those wishing to receive a grant.
2. Copies of all documents confirming the identity and (most often) the application form of the participant.
3. Copies of documents capable of confirming your competence in the economic sphere. This can be a diploma or a certificate of completion of various specialized courses.
4. Copies of registration and constituent documents for your business, as well as papers on tax registration and registration. In the case of applying for business development - copies of documents confirming the availability of jobs or creating new ones.
5. Business plan. This item is required.
The list above is approximate. It can always be supplemented and expanded. Therefore, treat him carefully. In the absence of any papers or their incorrect compilation, the right of the fund is to refuse to consider your application.
Consider a small step-by-step instruction on this issue:
1. Choosing the organization that is right for you.
2. Studying the history of the issuance of money by her - what projects and in what amount were financed.
3. The study of the requirements put forward by the fund and the rules for the preparation of applications for those wishing to participate in the selection.
4. Preparation of a full package of necessary documents.
5. Drawing up a real business plan with a clear definition of your goals, existing problems and solutions. Make the main emphasis in it on the financial side of the issue.
6. Preparation of a detailed and as convincing as possible presentation of your own future project.
By submitting an application for consideration, you switch to “standby mode”. Most often, within three months after the application deadline, funds consider them and make a decision. The first few days of this period are devoted to checking the correctness of their preparation and the availability of a complete set of necessary documents. Then the fund begins to study and compare the business plans provided to it.
Their assessment is most often according to their own scale developed by the foundation, which is used in the formation of the rating of participants. Particular attention at this stage is paid to the proposed solutions to the goals and identified problems.
In addition, the accuracy of the calculations presented is very carefully checked. When it comes to the state fund, those entrepreneurs who have a certain amount to start their own business or its development are especially noted. Business plans requiring full funding are usually rejected.
When it comes to an existing business, serious attention is paid to the dynamics of its development. In the case of issuing low indicators for the period of existence of the enterprise, he will most likely be refused. Those projects that the fund has already funded can count on additional points from the fund.
After the final rating of the participants is formed, the commission makes a decision who exactly can expect to receive a grant. Победителям рассылаются уведомления с одновременным размещением результатов на принадлежащем фонду официальном сайте.
Как распорядиться полученным грантом?
Что такое грант с юридической точки зрения? Его следует рассматривать как договор между нуждающимся в средствах бизнесменом и выдавшим их инвестором. That is why the first is now bound by a number of certain obligations requiring fulfillment:
1. The funds received should be spent exclusively on a targeted path, that is, only on what they were issued for.
2. Reporting is obliged to surrender in strict compliance with the agreed deadline.
3. In the event of force majeure or the inability to carry out specific actions on the project, the businessman must immediately apply to the fund with corrective proposals.
4. It is forbidden to impede the commission during the audit and it is required to report in detail on the entire amount of funds received.
If facts of misuse of the grant are revealed or if other conditions of the contract are violated, the organization or fund has the right to demand its termination and return all allocated funds in court. This issue should be approached with full responsibility. Think about whether you are able to fulfill all the conditions set by the fund.
In the case of a negative answer, you will lose an excellent chance of receiving additional financing for your business. The financial assistance issued by sponsoring organizations contributes not only to the development and support of individual entrepreneurs, but also to the recovery of the economy of the entire region.
Requirements may be different. Applicants are most often selected according to the following criteria: the head of the research team has not yet been forty years old, the entire composition of the participants refers to students and graduate students or to employees of a particular university or research institute. Participants should publish a number of scientific papers.
Most often, when reporting basic data about all the contestants, it is required to provide information on the participation rate of each of them.
In addition, in this case there is the concept of an additional grant. This is the name of the subsidy received by the winner in multi-stage competitions. At the first stage, the commission selects a number of participants demonstrating the most obvious successes and achievements. But the competition is not completed by their receipt of grants. In the second phase, a reporting conference is held with summing up the intermediate results of the work of teams of young leaders. The one whose story is most convincing can count on a second prize.
How to get a training grant?
Thinking about this follows young talented students and graduates of Russian universities who do not have sufficient funds. It concerns people stubborn and inquisitive. Presidential grants are provided for the most talented. If sufficient effort is made, everyone has a chance to get a subsidy for further education within the walls of a foreign university.
Having received an international grant, you will have the opportunity not only to study at a prestigious Western institution, but also to radically improve your own knowledge of a foreign language. These subsidies are issued by universities, scientific foundations and public organizations. Moreover, the grant issued for training can be either full or partial.
In the first case, the amount of money is intended to cover the entire set of expenses up to travel, meals and accommodation. This is a fairly rare option. Partial subsidies are more common.
Who can count on him?
For many years, there is a program according to which many talented Russian students receive the right to free education in the USA. It is possible to win a similar grant for a high school student. Having won the competition, he goes to the USA and studies at a local school for several months with an American family. All costs are borne by the US government.
To receive such a subsidy is the dream of almost any schoolchild or student. But victory in such a contest is not an easy task. The chances of receiving an international grant are increasing for graduate students and young university professors. Age of participants - most often not older than 30 years.
Before applying, you should decide on the country in which it is desirable to continue education. Then the list of universities offering such programs is specified. After that, a meaningful competent letter is compiled, and the chances are increased if it is sent to several different universities. The summary lists personal accomplishments and plans for the future.
Similar competitions are held in Russia. Victory in them is easier to achieve in comparison with international ones only at first glance. Grants are issued to the most promising young scientists or students. If your candidacy is rejected, do not despair. After all, the number of grants is most often limited. The most stubborn and hardworking, in the end, win and it always makes sense to try again next year.
Who can count on a grant?
In this regard, there are no significant restrictions. The only things they usually pay attention to are timely tax payments and credit history. If you are a bona fide taxpayer, if you have never quarreled with banks and paid all loans on time, you should not have problems getting a grant.
Particular attention may be paid to you if you have previously had experience in obtaining grants. This factor can play a negative role if you ruined your reputation. Untimely submission of reports, embezzlement of funds for other purposes, etc. - Similar facts of your biography will reduce the chance to get a grant to zero.
There are categories of citizens who have priority in obtaining subsidies:
- University graduates,
- Officially unemployed,
- Disabled people
- Citizens who have been reduced
- Retired military
- Single mothers
- Young people under the age of 35.
What are the grants for?
Best of all, if you ask for money for a specific purpose: renting a room, purchasing equipment, raw materials, etc. Such a request makes it clear that all other sectors of your business already have financing, which means that the business is confidently on its feet and will not fall apart in a year.
As for the areas of activity, most of the grants are received by enterprises from the service sector. In second place are manufacturing enterprises. Little is allocated to trade grants. If you are going to sell something, it will be easier to find private investors than to contact the state.
In addition to the state, grants are allocated by foreign funds. If you turn to them, they have slightly different priorities. The development of the country's economy is not of interest to them, but if your business involves research in the field of ecology, social development, culture, if the project promises to contribute to the development of the global economy, foreign funds will give you a grant with great willingness.
The state actively allocates subsidies for industry, agriculture, education and the development of natural sciences.
Grants leaders in recent years:
- Clearing companies
- Repair shops,
- Private educational organizations,
- Marketing agencies,
- Design organizations.
Who gives the grants?
In addition to the state represented by committees on business and economic development, grants are provided by various foreign funds. Today, the largest of them is Microsoft Corporation. But in this case, your business should be connected with computer technology.
In Russia there are private organizations issuing grants. This is Pavel Durov, the creator of the Vkontakte network. He and his company allot money in the IT field. The Skolkovo Foundation provides funds for projects in the field of biomedicine, nuclear, space, energy-efficient technologies.