22nd February, 2018
If you’re a startup founder, you’re probably strapped for cash – and government grants can provide that cash, if you get it right.
There are all sorts of government grants available out there, from the R&D Tax Incentive to the Wage Subsidies Program – but there are things to remember when making grant applications and things to avoid.
In my experience, there tend to be five key mistakes startup founders make when going after grant money.
The Australian government has close to 400 federal grants (there are many available in NZ too) that are available for businesses across all industry sectors, and often a business is eligible for more than one of them.
Startup founders sometimes put a lot of effort into one particular grant, when they could be pursuing a different grant that might be more beneficial for what they are trying to achieve.
So it’s really, really important to do your research into the grant you’re applying for to avoid wasting your precious time.
It’s always tempting to push off the preparation and submission of grant applications.
For startup founders in particular, focus is already split across many other priorities, while grants often fall to the bottom of the list.
It is always best to prepare the submission as far in advance as possible and to submit at the first opportunity.
When leaving submissions until the last minute, founders often oversee key elements of the grant and subsequently miss out on maximising those opportunities.
Aside from many pages of paperwork, most grants require significant backing documentation that can back up whatever is written in the application.
If a grant application is submitted without supporting documents and the business receives a government review or audit on their application, the grant may be denied.
It’s always worthwhile to invest more time to ensure that the grant is review-ready.
Believe it or not, you don’t need to do everything yourself!
Government grants are generally tied up behind a lot of red tape and bureaucracy, pages of compliance and long lists of eligibility criteria and legislation.
Many of them are competitive and require hours upon hours to complete.
Often, startup founders make the mistake of completing the application themselves when their time would potentially be better spent on growing their business.
Consider handballing these applications to someone who has the time, expertise and resources to complete it effectively.
The two most common ways of obtaining funding for a business are through investors and government grants.
When pitching for a grant, you’re essentially pitching for the government’s buy-in (and money).
Many investors will be more inclined to fund projects after knowing that the startup has the possibility of being backed by the government.
It gives your startup a degree of legitimacy and validation that it wouldn’t have otherwise. Use it.
It can’t hurt to make the point to investors that your startup could be a bit more cash-rich in the future…
If you’re seeking funding through government grants, make sure not to make these mistakes.
Always make sure you do your due diligence and that you submit your applications in advance with documents to support what you’ve written.
Consider handing over the responsibility to someone who has the time and expertise to complete it properly, and leverage the fact that you are eligible for government funding when pitching to other investors.