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Are There Grants to Start a Restaurant?

grants to start a restaurantMillions of people have been seduced by the idea of free money from the government to start a business of their own. What is the truth? Are there grants available to start a restaurant?

The truth, unfortunately, is that very, very few small businesses will ever get a grant- and none of these are going to be restaurants. In fact, for nearly any small business you can think of, applying for a grant is a waste of time.

That doesn’t mean you should give, up of course! If you want to start a restaurant, even with little or no money of your own, you can do it. The one thing you really need to be successful actually has nothing to do with money.

But, let’s finish our grant discussion once and for all so everyone knows the truth.

To have any shot at all for a grant, you need to in one of these situations:

  • Creating jobs in low income areas (very specific rules apply)
  • Working on a product that will benefit a healthcare, scientific or military objective
  • Working on a project that will benefit the environment
  • Working with the disabled
  • Directly benefiting the government in some capacity

That means nearly any main street type of business you can think of will not qualify: restaurants, bars, contractors, plumbers, carpet cleaners, day care facilities, trucking companies or any homebased, professional or service businesses.

We have a lot of restaurant success stories on this site, and not one of them involves anyone starting by getting a grant.

If you aren’t working on a new drug, new medical technology or new technology that could be used by the military or government scientists, you don’t have much chance.

It is possible, if you plan to locate a large business in an economically depressed area that you could get some grants to help you out, but this generally rules out startups, which don’t have a big payroll to begin with.

If you were building or remodeling low income housing, you might find some grants, but then you probably need them, since you can’t sell your projects for what would otherwise be fair market value.

In general, there are so few grants available for small businesses as to make the idea a practical waste of time.

If you want to check it out, the government has a website, grants.gov that lists all the available grants at any given time. If you do find something, or think you might qualify for some reason but don’t find anything there, then you can also check with your state and local governments, who may have something for you.

Your best bet, however, is to concentrate your efforts on things that actually will provide you with startup capital, such as your savings, friends, family, the SBA, partners, angel investors and starting your own ultra small business (like a food cart, farmer’s market stall or selling your food at events) to build capital in order to get to the bigger business you really want.

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