Government Grants

Definition: An award of financial assistance in the form of money by the federal government to an eligible grantee with no expectation that the funds will be paid back. The term does not include technical assistance which provides services instead of money, or other assistance in the form of revenue sharing, loans, loan guarantees, interest subsidies, insurance, or direct appropriations .

Even in the most economically challenged of times, the government is one of the best sources for grants. For instance, the National Institute of Standards and Technology's Advance Technology Program offers grants to co-fund "high-risk, high-payoff projects" that will benefit American industry. Whatever the project is, you can bet it will be scrutinized by a board of qualified experts and academia.

The Small Business Innovation Research (SBIR) office is another government agency that gives grants. The SBIR specializes in small businesses looking for funding for high-risk technologies. The catch: Unlike the Advance Technology Program, the technology must meet the research and development needs of the federal government. Founded in 1982, the SBIR recently awarded $1.5 billion to startups, with grants going to software, biotechnology, health-care and defense companies. So if you're planning on opening a pizzeria, you might have trouble with this one.

But there are federal grants awarded to food and nutrition companies. For instance, a pizzeria that caters to children and specializes in serving nutritious, healthy pizzas may be able to win a grant. You can also check with your state or local government to see what's available--start with your local or state chamber of commerce.