10 Minority Small Business Grants
Getting funding is one of the toughest parts of building a small business. To help, we’ve put together a list of grants that cater specifically to minority-owned businesses.
Research shows that diversity in business leads to economic development and growth. If racial income disparities were to be eliminated, America’s annual GDP would be $2.1 trillion higher—a 14% increase. However, systematic barriers persist, making it difficult for entrepreneurs of color to get the funding and business resources they need to set up and grow their companies. And that doesn’t even account for the hardship caused by the pandemic.
But don’t lose hope. Where there are challenges, there are people and organizations willing to step up. And in this article, we’ll show you how to access the many minority small business grants available to entrepreneurs just like you.
10 Small business grants for minorities
Dozens of organizations offer general-purpose grants to entrepreneurs of all backgrounds, but some go the extra mile to support diverse businesses. These 10 grants exist specifically for minority and women entrepreneurs.
1. Stacy’s Rise Project
Since 2017, Stacy’s has provided funding, resources, and mentorship to thousands of women entrepreneurs, including entrepreneurs of color. Together with Hello Alice, a company that helps small businesses thrive, and Hello Sunshine, a media company founded by Reese Witherspoon, Stacy’s is currently offering $15,000 in business grants to women founders in the packaged food and beverage space.
In addition to a cash prize, each winner will receive mentorship from a PepsiCo executive, visibility on Stacy’s platform and those of its partners, and access to a peer network with other women entrepreneurs. To be eligible, you must:
- Identify as a woman entrepreneur or a woman entrepreneur of color.
- Be the leading executive (founder or co-founder) of the business.
- Operate a for-profit, U.S.-based business selling consumer packaged goods.
- Must have $25,000 to $1 million in annualized sales.
- Must be at least 50% woman-founded or currently 50% woman-owned.
2. Coalition to Back Black Businesses
The Coalition to Back Black Businesses is an annual grant initiative administered by the U.S. Chamber of Commerce Foundation that’s promised to endow a whopping $14 million to support Black-owned small businesses in economically distressed communities.
The program opens for its final year of funding in August 2023. In September, a handful of randomly selected finalists and waitlisted finalists will be asked to complete a full grant application. (Special consideration will be given to Black women-owned businesses, which must make up at least 25% of the awarded grants.) Winners of the $5,000 grants are announced in October 2023. These winners are eligible to apply for additional $25,000 enhancement grants the following summer.
3. The SoGal Black Founder Startup Grant
With the support of several partners, the SoGal Black Founder Startup Grant awards Black women and Black nonbinary founders with several $10,000 and $5,000 cash grants each year. Awardees also receive fundraising help and technical assistance, as well as “ask-me-anything” access to the SoGal Foundation and SoGal Ventures teams. To qualify, you must:
- Self-identify as a Black woman or Black nonbinary entrepreneur (inclusive of multiracial Black women and multiracial Black nonbinary folks).
- Have a legally registered business.
- Plan to seek investor financing in order to scale, now or in the future.
- Have a scalable, high-impact solution or idea with the ambition to be the next billion-dollar business.
4. Fearless Strivers Grant Contest
The Fearless Strivers Grant Contest is a collaboration between Mastercard and the Fearless Fund (a venture capital fund that invests in businesses led by women of color who are seeking pre-seed, seed-level, or series-A financing). The grant will give $10,000 grants to 11 small businesses across the country.
Winners will also receive tools to support their online business growth, and one-on-one mentorship. While the national program awards a single monthly $10,000 grant, additional grants are often available to residents of specific cities throughout the year.
To qualify, you must be a Black woman who is a legal U.S. resident, 18 years old or older, and the principal owner of a U.S.-based small business.
5. digitalundivided’s BREAKTHROUGH Program
If you need help with growth marketing or leveling up your customer analytics, this grant could be your big break. Each company accepted into digitalundivided’s annual BREAKTHROUGH program receives mentorship on these topics as well as a $5,000 cash grant.
The program itself is a partnership between digitalundivided, a nonprofit organization dedicated to catalyzing economic growth for Latina and Black women entrepreneurs, and JPMorgan Chase’s Advancing Black Pathways, an initiative to help the Black community achieve economic success and empowerment. Keep an eye on digitalundivided’s website for information about upcoming grant cycles. To qualify, each applicant must:
- Identify as a woman
- Identify as Black or Latina (or both)
- Be 18 years of age or older
- Have a business that’s been registered for at least a year
- Have majority ownership of an established business
- Have a technology component to the business (like a website or mobile app)
- Generate a minimum of $50,000 in annual business revenue
6. The Power Forward Small Business Grant
The Power Forward Small Business Grant is a combined commitment of $1 million from Vistaprint, the Boston Celtics Shamrock Foundation, and NAACP. The $25,000 grants are awarded on a rolling basis to Black-owned small businesses across New England. Recipients will have opportunities to be featured on national co-branded platforms and receive marketing and design resources customized to their specific needs.
To qualify, you must be a Black-owned business with a maximum of 25 employees and be based and operating in Massachusetts, Maine, New Hampshire, Rhode Island, Vermont, or select areas of Connecticut.
7. EnrichHER Small Business Grant
EnrichHER provides grants of $5,000 to entrepreneurs who are women or people of color. The company itself is a Black woman-owned FinTech lender, and has so far given out $14 million in capital to minority-owned businesses from 47 U.S. states. The cash can be used for anything from rebranding your company to developing a new product or service.
8. Comcast RISE Investment Fund
In 2020, Comcast NBCUniversal announced a multi-year plan to help fight injustice and inequity. To do that, they promised to allocate $75 million in cash and $25 million in media over the following three years. The Comcast RISE Investment Fund is part of that initiative. The program will provide 500 grants of $10,000 each. The grants are available in five cities:
- Chicago, IL
- Miami, FL
- Oakland, CA
- Seattle, WA
- Washington, D.C.
Each city is allotted 100 grants. To qualify for one, your business must be at least 51% owned and operated by someone who identifies as a person of color, including Black, Indigenous, Hispanic, and Asian American owners. All women entrepreneurs are also eligible for this grant.
9. Galaxy of Stars Grant
Galaxy of Stars is a community for minority and women entrepreneurs. It’s a great source of networking opportunities, and it gives business owners a space to support one another in reaching their business goals. The organization’s $2,750 Galaxy Grant is open to ethnic minorities and women who currently own their business or plan to start one. As a testament to the Galaxy of Stars’s emphasis on mutual support, they have an added perk for referrals: if you refer a friend to the grant and they win, the grant amount is doubled, and both applicants get a cash prize.
10. Wish Local Empowerment Program
Wish is an ecommerce platform that allows brick-and-mortar stores to become pickup locations for online orders through a program called Wish Local. To help promote diversity among American businesses, Wish has promised to give 4,000 Wish Local small business partners grants between $500 and $2,000.
There are no specific requirements for spending the grant money, which means you can use it for anything from real estate or equipment procurement to working capital. Applicants must be Black-owned stores that have 20 or fewer employees and an average annual revenue under $1 million.
Minority business grant FAQs
Finding grants is just the first step of the funding process. The next step is making sure you understand how grants work, what purpose they serve, and how you can improve your chances of getting one. Here are some frequently asked questions about minority business grants.
What is a minority business grant?
A minority business grant is a grant given to minority-owned businesses, often in underserved communities. The term “minority” can refer to ethnic groups such as African American, Hispanic, Native American, and Asian-American business owners, but it also encompasses low-income communities, members of the LGBTQ+ community, and veterans. American women from all ethnicities are also considered a minority group by many grant-making organizations.
What is the difference between a small business grant and a small business loan?
There are a few key differences between a small business grant and a small business loan:
- While a business loan has to be repaid according to a specific schedule and usually with interest, a grant is free money. There’s no interest rate, and you never have to repay it.
- Grants are typically offered to qualifying businesses on a competitive basis. Loans, on the other hand, are offered based on your business’s financial stability or revenue generation.
- Grants are often used to further a mission. That could be elevating economic opportunity for a particular group, creating a level playing field for founders of color, or supporting businesses in a particular industry. Loans, on the other hand, are offered to help individual businesses, usually without specific ideals in mind.
- Grants are typically offered through a one-time contest or annual assistance program. Loans are available on an ongoing basis.
- With grants, you’re competing with other businesses for a limited pool of money. But with loans, the lender judges your business independently, solely on the basis of your credit history and entrepreneurship record.
How can I improve my chances of winning a minority small business grant?
When you apply for business grants, you’re not just being judged on your personal business acumen. Instead, you’re being compared to other businesses that have applied for the same funding opportunities. To increase your chances of winning the grant:
- Check that you meet all the qualifying criteria. Some grants can get very detailed, and you don’t want to waste time applying for ones that aren’t a good fit.
- Take your time on each app. While it’s tempting to apply for a large number of grants quickly, you’re more likely to get a grant if you take your time on a select few and customize each application to the grantor’s requirements.
- Be specific, not general, when it comes to describing your business, your values, and your goals. The more a grantor can see what sets you apart, the more likely they are to buy into your mission.
- Understand what the grantor is hoping to achieve by awarding these grants. In your application, explain how selecting your business would help the grantor achieve its goals.
- Include a well-written business plan. Some grant applications request a business plan. If required, your business plan should highlight your business goals, marketing strategies, and financial projections. Also include an excellent pitch for why your business should get the grant.
- Follow the application instructions to the letter. If you’re asked to submit one page, don’t go over and submit two instead. This can disqualify you in many instances, so make sure to read and follow the instructions carefully during the application process.
Where else can I find funding resources for minority businesses?
For more funding sources, including loans, check out the following:
- 1. Grants.gov: This is a comprehensive directory of 1,000+ federal grants. Eligibility requirements are listed for each program.
- 2. Minority Business Development Agency (MBDA): The MBDA is the only federal government agency dedicated to the growth and global competitiveness of minority business enterprises. The website includes links to grant programs.
- 3. National Association for the Self-Employed (NASE): With a membership to NASE you’ll get notifications about and access to grant opportunities. NASE also offers $4,000 Growth Grants to four NASE members each quarter.
- 4. U.S. Small Business Administration (SBA): The SBA is a cabinet-level federal agency dedicated to small businesses. It runs a number of business centers and business development programs, including its Small Business Innovation Research and Small Business Technology Transfer (SBIR and STTR) programs. To qualify for these, your small business must be engaged in scientific research and development.
- 5. National Black MBA Association: This association helps create educational, wealth-building, and growth opportunities for historically underrepresented entrepreneurs and professionals. Its annual Scale-Up Pitch Challenge, a competition that connects startups with early-stage investors and venture capitalists, is part of that mission. Each year, three finalists compete, and the winning team takes home a $50,000 grand prize.
- 6. U.S. Department of Agriculture: The USDA keeps a list of grants and loans for small business owners who work in rural and agricultural communities. Many of these funding opportunities cater specifically to family farmers and ranchers who cannot obtain commercial credit from banks and other traditional financial institutions.
Explore funding options with AOF
Grants are a fantastic way to get free financial assistance for your business. However, winning grant money can be extremely competitive. For some of the bigger programs, you could be competing with hundreds of other small businesses to earn a limited pool of funds.
If you need small business financing fast, consider taking out a loan from Accion Opportunity Fund. Our flexible-term loans allow minority business owners to get the funding and business training they need to start—and grow—their businesses. In fact, 75% of AOF’s borrowers and 82% of the entrepreneurs we coached in 2021 were people of color. Find out more about our small business loan program and consider applying today.