Is there free government grant money for starting or growing a small business?

Written by Kaz · Published 27 September 2026 · How figures are checked

Summary

Not for ordinary startup or expansion costs. SBA says it "does not provide grants for starting and expanding a business," and USA.gov says federal grants are "typically only for states and organizations." The federal money a for-profit small business can reach is narrow: research and development funding through SBIR and STTR, and export help that flows through the states under STEP. Both are tied to a specific activity, so a firm that just needs working capital or a fit-out is outside both. This page covers federal programs; state and city schemes are run separately.

Where SBA's grant money goes

SBA does make grants, to nonprofits, its resource partners, and educational organizations, for counseling and training. Its SCORE grant page is blunt: "For-profit businesses are not eligible for this award." Grants.gov says most of its listings "are for organizations, not individuals," and that none provide personal financial assistance. A grant line in SBA's budget, in other words, pays the people who advise small businesses rather than the businesses themselves.

If you do research and development

SBIR and STTR, branded America's Seed Fund, are run by 11 federal agencies within rules set by Congress, with SBA coordinating. The eligibility checklist starts with fewer than 500 employees. The government takes no equity and no intellectual property.

Phase I is proof of concept: 6 to 12 months, typically $50,000 to $275,000. Phase II is technology development over 24 months, $750,000 to $1.8 million. Agencies can go above those typical ranges; as of April 2026 the caps were $323,090 for Phase I and $2,153,927 for Phase II without SBA sign-off. Some agencies, including NASA and the Department of Homeland Security, fund through contracts instead of grants, which means a deliverable owed to the agency rather than money handed over for your own plan.

If you want to export

STEP money goes from SBA to state and territory governments, and state agencies hand it out locally. It is meant for "established U.S. small businesses" and covers costs such as foreign trade missions, trade show exhibits, international marketing, and website globalization. A company that has not started operating yet falls outside that description, and so does a domestic cost dressed up as export spending.

How the fake offers look

The FTC puts it in one line: "Offers of free money from government grants are scams." The government "won't call, text, reach out through social media, or email you" about a grant. Real grants require an application and are always tied to a specific purpose. Applying is free, the full federal list at Grants.gov is free, and a request to pay a fee by gift card, wire, or cryptocurrency is, in the FTC's words, "always a scam." The "Federal Grants Administration" that some callers name does not exist, and SBA says it only writes from addresses ending in @sba.gov.