Government Grant funding in Australia
15/03/2012 4 Comments
Grant funding is often overlooked as a source of capital for small business in Australia. Admittedly there are few, if any, grants for starting a business, however there are grants and other assistance available for business activities such as expanding your business, research and development, innovation and exporting.
All of these activities can be very expensive and therefore any Government assistance available to mitigate these costs should be considered.
A grant can help with capital purchases, training, advertising and promotion. Many of these grants have a very niche focus though e.g. supporting indigenous Australians, growing primary production capacity, targeting export markets etc. But don’t give up hope as it’s pretty quick and easy to see if your business is able to apply for a grant.
Where to find them?
So where do you start? Well go and have a look on Google for Government Grants and you’ll find quite a few websites all offering to solve your funding issues by helping you identify and apply for grants relevant to your business sector and your needs.
The other option is to use the business.gov.au website, an Australia Government website which, at last count, had information on 620 grants across Australia. You can search for grants at a Federal or State/Territory level through this website.
The other option is to research your local council website to see what grants are offered for small business. Again, you are unlikely to find any that will fund start-up costs but you may find some financial assistance to support a training or marketing program you are undertaking.
How do they work?
Each grant is different, some are available once a year, others on a quarterly basis and some on an ongoing basis. You will need to look at each one to see when the next grant applications are assessed.
Some grants may also require a financial contribution from the business on a matching basis, i.e. we’ll give you $20,000 if you put in $20,000, which is all very well as long as you have a lazy $20,000 hanging around!
Commercialisation Australia (CA)
One of the most popular grant funding agencies in Australia is Commercialisation Australia, a Government initiative which is a competitive, merit-based assistance program offering funding and resources to accelerate the business building process for Australian companies, entrepreneurs, researchers and inventors. They have ~$280 million of funding available through to 2014 and ~$80 million per annum there after!
They have four broad grant categories
- Skills & knowledge – up to $50,000 to access specialist advice and services. A 20% contribution is required from the participant. This grant can cover the cost of developing or reviewing a business plan; determining suitable corporate structures; undertaking a risk analysis,; developing an investment proposal and pitch; and developing a capital plan to identify funding requirements amongst others.
- Experienced executives – up to $350,000 to engage a CEO or other experienced executive. A 50% contribution is required from the participant. This grant can cover employment of an experienced Chief Executive Officer or other senior executive.
- Proof of concept – $50,000 to $250,000 to prove the commercial viability of new IP. A 50% contribution is required from the participant. Proof of Concept assistance will fund the steps necessary to establish the commercial viability of a new product, process or service including costs in relation to Labour, Contracting , Plant, Prototyping and Intellectual property protection.
- Early stage commercialisation – $50,000 to $2 million to take a new product, service or process to market. A 50% contribution is required from the participant. Proof of Concept assistance will fund the steps necessary to establish the commercial viability of a new product, process or service including costs in relation to Labour, Contracting , Plant, Prototyping and Intellectual property protection.
So let’s conclude by looking at our funding checklist:
- Cost of funding – grants are typically not repayable but may require a participant contribution of up to 50%.
- Ease of obtaining – There is normally a strict set of application criteria that have to be met. Grant funding is limited can be a very competitive process.
- Speed – This depends on the agency in control of the grant. As with any “red tape” things can drag on a bit so you need a good dose of patience!
- Security – none, zilch, zippo
- Consequences – You will be responsible for reporting back to the agency who provided the grant and showing them proof that the grant was spent in the manner originally anticipated.
- Size of funding – this varies considerably from a few thousand up to $2 million.
So Grant funding is potentially a viable option for many small businesses in Australia to consider. It’s worth taking a bit of time and doing the research, you may be pleasantly surprised!
What grants have worked for you and which were a waste of time and effort? Please feel free to share and comment.
Contact Lattice Capital on email@example.com for more advice on accessing Government Grants.
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