Free Money: Are There Really Free Government Grants To Start A Business?

government grants

Don’t Believe the Hype of Late Night T.V.

A lot of people watch late night television, and become convinced that there is a secret vault the government keeps watch over, full of free money for solopreneurs, freelance business people, and anyone else looking to start a small business.

Let me ask you: In your experience, is there really such a thing as a free lunch? Right. But actually, it is a qualified “right.”

If you think there is free government grant funds to start your business, you would be wrong. But that said, in special circumstances, there is grant money available. Typically, that money is awarded by a federal agency to a business that is doing something that furthers that agency’s public policy objective.

Real World Examples of Government Grant Money in Action

Example: In 2007, a company called TruTouch Technologies received grant money to assist in the development of its invention, a device that detects blood-alcohol levels by shining infrared light on the skin.

The uninvasive test takes 60 seconds to get results, as opposed to 20 minutes for a Breathalyzer.

The funding came from an IRS program that offered grants to businesses that demonstrated the potential to develop “new therapies to treat chronic conditions or unmet medical needs, reducing long‐term health care costs in the United States.”

That was the public policy purpose. Said Dr. Trent Ridder, CTO of TruTouch, the grant “recognizes our commitment to reducing the devastating medical costs caused by alcohol related accidents and injuries.”

The company got almost a quarter million dollars in Round 1, and another $438,000 in Round 2; the second grant coming from the United States Army Medical Research and Materiel Command (USAMRMC).

The point of this story is two-fold:

  1. It shows that yes, there are some of those magic government grants out there that we all hear about. But hopefully, the story also illustrates that…
  2. Such grants are very specific and often very technical in nature.

The fact is, while there is indeed some limited grant money available to business, it is not for individuals, not for startups, and also is very difficult to get.

As the Grants.gov website says, “We have all seen them; late night infomercials, websites, and reference guides, advertising ‘millions in free money.’Don’t believe the hype! Although there are many grants on Grants.gov, few of them are available to individuals, and none of them are available for personal financial assistance.”

That said, if in fact you do think you might qualify for some of this R&D research grant money, then the place to go is the U.S. government’s Small Business Innovation Research (SBIR) program and its Small Business Technology Transfer (SBBR) programs. SBIR/STTR does in fact offer grants to companies that are involved in high-tech R&D. When looking for a federal grant, this is your best bet. For more information, go to SBIR.gov by clicking the link above.

Beyond SBIR/STTR, there are some other, less technical grants available through other federal agencies. You can find them at

Additionally, you might consider conducting an online search for the terms “business grants” and the name of the federal agency that may need your goods or services.

All of that said, it is probably better to think of these sorts of opportunities as federal contracts as opposed to free grants. If you do that, then the answer is that yes, there is federal grant money available.

Do you have another take on the federal grants issue? Did your business successfully research and land a grant from the government? Consider sharing your story with us in the Self-Employed Blog.

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