This website uses cookies

We use cookies to improve your experience. Find out more about our Cookie Policy.

Close

How to get grants for a business start-up?

How to get grants for a business start-up?
Peter Beresford
Raising finance, Mentor
Find out more about Peter Beresford

In this article you’ll learn

  • Places you can go to get government grants
  • About specific business activities that get more grants

When you’re first starting out, you’ll likely want to know how to get grants for a business start-up. Grants to start a small business  can be notorious to come by, but there is assistance out there if you know where to look. There can be as many as 3,000 grant schemes running for UK businesses at any given time, so it comes as no surprise that start-ups can often find navigating business grants a complicated process.

So, how to get grants for a business start-up?

Grants to start a small business generally fall into one of three categories: Government grants, European grants and Local grants. Each grant provider has its own departments and agencies which offer funding based on specific criteria and objectives.

For UK businesses, you might be able to get small business government grants from a support scheme if you need some initial funding to test and develop your business idea. Search for business finance using the funding finder tool to see if you are eligible for any such schemes.

Woman reading a document in front of her laptop

The European Union is a source of funds for businesses of all sizes and grants tend to be distributed through the European Commission. This body administers a number of schemes through structural funds such as the European Regional Development Fund.

Local government authorities are also potential sources of funding; the Local Enterprise Partnerships are a good example of this, established specifically to support and encourage enterprise at local level.

Prince’s Trust work with 18 to 30 year olds and offer training and mentoring support for funding and resources, other sources might include your bank or trade association.

When applying for grants to start a small business, it is extremely rare for a grant to finance 100% of the costs of any project; you must be prepared to put some of your own money into the business. Grants generally cover 15% to 60% of the total finance required.

Three business people around a table looking at documentation

Most national and local grants focus on particular business activities or purposes these are: 

Investment

There are regional grants that support growth through capital investment and job creation. 

Innovation

There is a wide range of grant schemes that encourage research and development (R&D) activities. R&D grants that focus on specific industries are periodically launched (eg the Carbon Trust, DEFRA have all launched such grants). Find out about research and development tax savings here.

Energy and the environment

These schemes recognise the additional cost for businesses that adopt or engage in investments that improve energy efficiency and reduce environmental impact. 

Training

Assistance to develop the skills and capability of staff is provided through apprenticeships. The National Apprenticeship Service gives advice to employers on how to start an apprenticeship scheme in their business. You may also qualify for a grant towards recruitment cost and training. Take a look at our guide to apprenticeships here.

Exports

Support is often available to businesses looking to export goods they manufacture. UK Trade & Investment (UKTI) offers funding to help exporters, as well as a range of subsidised services. 

Finally, depending upon individual circumstances and the amounts of grant involved it can be beneficial to seek professional help. Your accountant or local grant specialist could save you time and produce a better result. 

Take a look at the funding finder to see what grants are available to you, or check out the specific funding programmes for growing a business.

Call to action to download the guide to alternative finance

Summary

Peter Beresford talks you through how to get grants for a business start-up and what specialist business activities get the most grant funding.