26 Small Business Grants For Minorities

Minority-owned businesses make up about half of all the new businesses created in the last decade. According to the 2022 Annual Business Survey from the U.S. Census Bureau, 1.2 million or 21 percent of employer firms are minority-owned.  They’ve helped create nearly five million new jobs and generate close to $700 billion but still face significant financial challenges.

Small business grants for minorities provide funds to minority business owners — groups that have historically lacked fair access to business capital. Unlike small business loans, these grants don’t have to be paid back, though you will likely face a lot of competition for these funds.

Here’s a look at 26 of the best small business grants for minorities and additional resources that could help you secure financing for your business.

Bankrate insight

Data from the Federal Reserve Banks Small Business Credit Survey highlights the financial challenges faced by minority small business owners. It was found that in 2022: 

• Less than 10 percent of minority-owned firms had excellent financial health
• The top financial challenge minority-owned firms faced was the increased cost of goods, services and/or wages  
• Over the past five years, minority-owned firms were more likely to use personal savings to cover business expenses than other sources of funding

Federal small business grants for minorities

1. Grants.gov

Grants.gov is a federally operated website that hosts more than 1,000 funding opportunities — including those for small and minority-owned businesses.

These grants are offered by federal agencies like the Department of Commerce and the U.S. Small Business Administration. Once you sign up, you can search the available grants and find the options that best match your business.

2. The USDA Rural Business Development Grant Program

Rural Business Development Grants can be used for technical assistance, training and other projects that benefit rural communities. While not specific to minority-owned businesses, the USDA Rural Business Development Grant Program is a valuable resource for rural regions where minority populations are leading sources of economic growth.

The USDA offers two types of grants: Opportunity and Enterprise grants. Both can be used for projects like community improvement, feasibility studies, strategic planning and leadership training. But Enterprise grants go further to also include projects like training and technical assistance, rural distance learning and land acquisition.

3. Small Business Innovation Research (SBIR) and Small Business Technology Transfer (STTR) Programs

The SBIR and STTR programs provide early-stage, high-risk funding to small businesses that conduct Federal Research/Research and Development (R/R&D). Grants come from eleven federal agencies that currently participate in the programs, including the Department of Health and Human Services (HHS).

As part of the HHS, The National Institute on Minority Health and Health Disparities (NIMHD) allocates grant funding to small businesses from all backgrounds that provide research and development specific to the health equity challenges faced by underserved communities.

Both the SBIR and STTR programs have three phases: Phase I awards can be worth up to $250,000, while Phase II awards are usually $750,000 for two years. Phase III funding isn’t provided by these programs, but there may be funding and production contracts that come from non-SBIR/STTR sources.

Additional federal resources

Direct grants alone won’t be enough to overcome social and economic disadvantages faced by minority small business owners. Here’s a look at some additional federal resources to look into:

Bankrate insight

Minority business owners are just one group that continues to face an uphill battle for equal access to capital. Women-owned businesses, veterans, and LGBTQ+ business owners have also historically lacked support and funding opportunities. That’s why the Small Business Association sets aside federal contracting dollars each year. Check out the SBA’s contracting assistance programs for more information.

Private small business grants for minorities

4. Wish Local Empowerment Grant

Wish created the Wish Local Empowerment Grant to provide financial assistance to its small business partners. Wish’s $500 to $2,000 grants for minority-owned businesses can cover rent, inventory costs and more.

5. HerRise Microgrant

The Yva Jourdan Foundation and HerSuite Spot offer monthly $1,000 HerRise micro-grants to women of color entrepreneurs. These grants provide financial assistance to women of color starting or expanding their small businesses. In the past, recipients have used grant funds to cover the cost of equipment, marketing and more.

6. Hawaii FoundHer Program

FoundHer is a program in Hawaii that focuses on promoting the growth of women-founded businesses, particularly targeting historically underserved AAPI and Native Hawaiian wāhine.

7. BGV Pitch Competition

Hosted by Black Girl Ventures, the BGV Pitch Competition is exclusively for Black or brown female business owners. Through the Raisify platform, audiences are given the opportunity to financially support the founders they believe in. Each founder has three minutes to pitch, followed by a three-minute audience Q&A. Three winners are awarded a first, second and third place prize of a $10,000, $6,000 or $2,000 grant, respectively.

8. Feed the Soul’s Restaurant Business Development Grant

Participants in the Restaurant Business Development Program not only receive $10,000 grants but also benefit from six months of consulting services and educational training. During the program, a focus is placed on menu consultation, customer service, human resources, merchandising and more to support their growth and development.

9. Founders First Job Creators Quest Grant

The Founders First Creators Quest Grant offers a unique opportunity for 25 businesses based in four different regions: Southern California, Chicago, Pennsylvania and New Jersey and Texas. This initiative aims to bridge that gap by providing financial support and resources to local businesses to expand and create jobs in their communities. Each business received a grant from a fund of $100,000 and a scholarship for a Founders First accelerator program.

10. The Freed Fellowship Grant

The Freed Fellowship offers monthly $500 grants for minority-owned businesses to help entrepreneurs build successful and impactful companies. Freed Fellows also receive a half-hour strategy session with a business expert, a one-year membership in the Freed Studio, which focuses on sustainable growth practices, and a chance to secure an extra $2,500 grant at the year’s end.

11. Rebuild the Block Bridge the Gap Fund

The Bridge the Gap Fund offers financial support to Black business owners impacted by the COVID-19 pandemic or looting destruction. This grant runs annually and takes three months for donations to be awarded.

12. National Association for the Self-Employed Growth Grants

Four times each year, the National Association for the Self-Employed (NASE) offers business grants of up to $4,000 to small business owners through its Growth Grants program. Funds can be used for marketing, advertising, hiring employees, expanding facilities and other specific business needs.

While these grants are open to small business owners in general, they can be a great resource for people who operate their own organizations and are looking to grow — which includes a growing population of business owners of color.

13. Small Business Growth Fund

The Small Business Growth Fund is a partnership between Hello Alice and the Global Entrepreneurship Network (GEN). It awards $5,000 to $25,000 grants to small business owners of any background. The most recent round closed in January, and there is no word on when the next cycle will open.

14. Merchant Maverick Opportunity Grants

Merchant Maverick’s Opportunity Grants were created to help fund small businesses that may have issues obtaining traditional business financing.  A part of Merchant Maverick’s mission is to drive positive change in the small business space.  As many underserved and marginalized groups and startups have difficulty accessing business financing, eligibility for the grant changes yearly. Previous grants have gone to Black female business owners, AAPI restaurant owners and Portland-area startups. Grant money can be used for the following: 

• Business space rent, utilities or renovation
• Payroll
• Repayment of business loans or taxes 
• Business equipment
• Business marketing
• Business travel expenses 

15. National Black MBA Association Scale-Up Pitch Challenge

Launched in 2017 by the National Black MBA Association, the Scale-Up Pitch Challenge was created to provide wealth-building opportunities for association members. The pitch challenge is a competition that aims to help “Make Big Ideas Bigger” by helping members create startups that are scalable. The competition also connects startups with early-stage investors and venture capitalists.

From the pitches submitted, 10 semi-finalists were chosen to compete at the upcoming National Black MBA Association’s annual conference, which took place September 14, 2023, in Philadelphia. The top three applicants moved on to a final round of pitching on September 15 and competed for a chance to win a $50,000 first prize. A second prize worth $10,000 was awarded, as well as a third prize valued at $7,500 and a People’s Choice award worth $1,000.

16. Comcast RISE Investment Fund

The Comcast RISE Investment Fund provides various resources to minority and female entrepreneurs, including assessment of the business and tactical planning, educational resources, and a $5,000 grant that can be invested in growth and sustainability. Award-winners also receive production of a 30-second TV commercial, along with a media strategy consultation and 180-day media placement. Computer equipment is also provided to winners.

This grant is limited to applicants from specific geographic areas. The target areas are Baltimore, Maryland; Detroit, Michigan (Macomb County, Oakland County, Wayne County, Washtenaw County); Memphis, Tennessee (Shelby County); Philadelphia, Pennsylvania; and Portland, Oregon.

17. The Coalition to Back Black Businesses

The Coalition to Back Black Businesses is a joint effort among several corporations to fund minority-owned businesses. The coalition includes American Express, Cummins, Optimum, Shopify and Firefli.

Qualifying businesses receive $5,000 grants, along with mentorship and training. A few promising businesses also receive $25,000 enhancement grants.

The Coalition to Back Black Businesses Grant is available to Black-owned small businesses in economically vulnerable communities that employ between three and 20 people.

18. FedEx Small Business Grant Contest

FedEx launched its annual Small Business Grant Contest in 2012. In that time, the company has given away $1.5 million in cash prizes to more than 100 small businesses.

For 2023, grants were recently awarded to 10 winners, one winning $50,000 and nine winning $20,000 each to grow and develop their businesses. There was also a print credit at a FedEx Office worth $1,000 and mentor matching. A grand prize winner who is also a U.S. veteran received an additional $20,000.

The annual contest is open to small businesses that have been open for at least six months, have fewer than 99 employees, use shipping services and have a FedEx account.

19. Fast Break for Small Business

The Fast Break for Small Business is a grant opportunity launched by LegalZoom in partnership with the NBA, WNBA and NBA G League. It currently awards Black-owned businesses grants worth $10,000 and an additional $500 worth of legal services provided by LegalZoom.

The program is managed by the Accion Opportunity Fund, a nonprofit that offers a business loan and additional resources to support small business owners who belong to groups that have historically faced limited access to business financing. This includes women, people of color, business owners of low-to-moderate income and immigrants.

20. The Entrepreneurial Spirit Fund

Since 2021, the Entrepreneurial Spirit Fund by SIA Scotch Whisky has provided $10,000 grants to entrepreneurs of color who work in the food and beverage industry. This grant program is inspired by Sia Scotch Whisky’s founder Carin Luna-Ostaseskia, one of the first Hispanic founders of a scotch whisky. It’s run in collaboration with Hello Alice, a free online platform that provides grants and small business resources to entrepreneurs across the U.S.

The grant cycle typically begins in the summer, though the application dates for 2023 have not yet been provided on the organization’s website.

21. Democratizing the Friends & Family Round

The Democratizing the Friends & Family Round program awards $25,000 to 20 female founders of color in New York City. Its goal is to help them overcome the early-stage funding gap that many women and women of color face. This is a joint program run by Hello Alice and Project Entrepreneur, a UBS initiative.

Even though this initiative is only for entrepreneurs of color in New York City, Hello Alice offers numerous resources and grant opportunities for small business owners all over the U.S.

22. Sage Invest in Progress Grant Program

The Sage Invest in Progress grant program awards 25 Black female entrepreneurs with $10,000 in funding along with training, mentorship and networking opportunities. It’s a collaboration between The Boss Network, an online community that helps to advance the career development of women of color, and Sage Foundation.

23. First Nations Development Institute Grants

Awarding grants since 1993, First Nations has awarded 3,385 grants as of 2023, which amounted to $79.9 million. The money has been used to support Native American projects and organizations in 45 states, the District of Columbia and the U.S. Territory of American Samoa. Past grants have included a Native Youth Business Plan competition.

24. Beyond Open Small Business Grants

Designed to offer economic mobility, Beyond Open Small Business Grants provide capital to businesses in Charlotte, North Carolina, that are owned by minorities, women, veterans, LGBTQ+ and individuals with disabilities. The next round of grant funding, which will open in 2024, is expected to make more than 150 awards totaling about $5 million. Individual grant amounts vary but range from between $10,000 and as much as $150,000. The money can be used to purchase equipment, technology, real estate or inventory. The funding cannot be used for operating expenses like payroll, advertising, marketing or utility bills.

25. CCWC Women of Color Entrepreneur Grant

The Corporate Counsel Women of Color Entrepreneurs grant offers five businesses owned by women of color $2,500 each to help grow and develop their businesses.

26. Galaxy Grant

The Galaxy Grant by Hidden Star provides financial assistance to women, individuals of color and entrepreneurs from low-income backgrounds. Each eligible business can receive a grant of up to $2,750.

Additional private resources

Here’s a look at just a few of the private-sector resources available to minority business owners:

• SCORE. This network of volunteers has been providing education and mentorship to small business owners since 1964.  
• Community Development Finance Institutions (CDFI) Fund. The CDFI fund provides financing to CDFI-certified lenders that serve low-income communities. These lenders then provide services, education and low-cost loans that can be used in many ways, including to help fund a business.
• Chambers of Commerce. These organizations offer training and resources that help promote the interests of local businesses.
• Farm Aid. This nonprofit organization has an annual grant program that funds family farms and rural service organizations. In 2022, it provided grants that assisted Black and other minority farmers and groups that worked for racial justice and social equity.

Bankrate insight

There are many chambers of commerce, even for historically underserved communities. These include:

Alternatives to small business grants

Small business grants may not be the best solution for everyone. Grants are typically available for specific purposes and may have narrow eligibility restrictions. The application process is often competitive.

If you are looking for more flexible options, consider alternatives to small business grants. These are typically more widely available, easier to apply for, and have fewer restrictions. But unlike grants, most of these alternatives must be repaid.

• Business loans. Some lenders have special programs that offer business loans for minorities. These tend to be more accessible than traditional loans and have lower rates and better repayment terms.
• SBA loans. The Small Business Association offers low-cost government backed loans to many types of small businesses, including businesses in underserved communities. There are several types of SBA loans to consider, including microloans of up to $50,000.
• Business credit cards. Opening a business credit card offers your business a line of credit that can be used to pay for expenses related to your business. They can also help you build business credit, which can help you eventually qualify for loans with better rates and terms.
• Business line of credit. Similar to a credit card, small businesses can seek a line of credit through a bank or other financial institution, providing flexibility to access funds when large expenses arise.
• Friends and family. While it can be difficult to ask, seeking financial support from friends and family can help. Formalize the agreement in writing and plan to repay the funds.
• Crowdfunding. Crowdfunding platforms can help you connect with potential customers enthusiastic about your product.

Bankrate insight

Learn more about SBA loans. Our review shows you the different types, interest rates, pros and cons and how to apply.

The bottom line

Seeking out grants is a great way for minorities to seek support in developing and growing their businesses. These grants may help businesses in underserved communities and support business owners who may not have ready access to other resources.

Frequently asked questions