With over 600 grants and a combined value of about $50 billion in cash available to businesses in Australia, grants should be part of every start-up and SME business funding strategy.
The return on investment is usually well worth the effort to obtain this cash, if you do a little homework first to determine where to direct that effort to get the maximum return.
Get daily business news.
The latest stories, funding information, and expert advice. Free to sign up.
Here is my five-step process for successfully evaluating the opportunity and then getting a grant:
1. Get your strategy right before considering grants
Grants fund projects and activities, not organisations.
Businesses can fall into the trap of being dazzled by the money available and allow the temptation of that money to direct their business strategy. This can be a dangerous proposition to tie your business to as market changes, new innovations and government policy changes can mean a grant program is short-lived and funding cut short.
This makes grants an important supporting resource, but not the driver of your business strategy. Your business and commercial objectives should be the driving force for this.
2. Have a plan to identify relevant grants and prepare early
When you’re setting your strategic objectives and projects for the year, it’s a good time to turn your attention to which grants might be available to fund those activities. A grant funding plan should be a key part of your overall business strategy.
Grants can fall into several categories:
- Prospective grants – awarded for future investments the business is planning to make.
- Retrospective grants – where you apply to recoup expenses already incurred.
- Competitive grants – basically involve a tendering process, where applicants need to provide a more compelling case for being awarded the grant over other applicants.
- Entitlement grants – have a predefined formula that is used by government departments and agencies to allocate the grant pool of funds to applicants that meet the criteria. The Export Market Development Grant works in this manner to divide the pool of funds set aside each year in two tranche payments.
Finding and applying for the grants is then a question of time, skillset and return on investment spent on obtaining the grant.
Do you have the right people with time and the right process to invest in researching, evaluating and pursuing grants for your business? If not, consider getting some initial support with some or all of these stages so you can take advantage of this valuable source of funds.
Story continues on page 2. Please click below.