Free Money: Are There Really Free Government Grants To Start A Business?


Many people watch television late at night and become convinced that there is a secret vault guarded by the government, full of free money for solopreneurs, freelance businessmen and anyone who wants to start a small business.

Let me ask you: in your experience, is there really such a thing as a free lunch? Right. But actually it is a qualified ‘right’.

If you think there are enough free government grants to start your business, you are wrong. But that said, in special circumstances, subsidy money is available. Typically, that money is awarded by a federal agency to a company that does something that furthers that agency’s public policy objective.


Real-world examples of government money in action

Example: In 2007, a company called TruTouch Technologies received grant money to help develop its invention, a device that detects blood alcohol levels by shining infrared light on the skin.

The non-invasive test takes 60 seconds to get results, as opposed to 20 minutes for a breathalyzer test.

The funding came from an IRS program that provided grants to companies that demonstrated the potential to “develop new therapies to treat chronic conditions or unmet medical needs, thereby reducing long-term health care costs in the United States” .

That was the purpose of public order. Dr. Trent Ridder, CTO of TruTouch, said the grant “recognizes our commitment to reducing the devastating medical costs caused by alcohol-related accidents and injuries.”

The company got nearly a quarter of a million dollars in Round 1 and another $438,000 in Round 2; the second grant came from the United States Army Medical Research and Materiel Command (USAMRMC).

The thrust of this story is twofold:

  1. It shows that there are indeed some of those magical government grants we all hear about. But hopefully the story also illustrates that…
  2. Such grants are very specific and often very technical in nature.

The fact is that while there is indeed some limited grant money available to companies, it’s not for individuals, not for startups, and it’s also very hard to get.

As the website says: “We’ve seen them all; late-night infomercials, websites and reference guides, advertising “millions of free money.” Don’t believe the hype! While there are many scholarships listed on, very few are available to individuals and none of them are available for personal financial aid.

What government grants are there?

That said, if you do think you qualify for some of this R&D research funding, you can turn to the US government. Exploring innovation for small businesses (SBIR) program and its Small Business Technology Transfer (STTR) programs. SBIR/STTR does provide subsidies to companies involved in high-tech R&D. If you’re looking for a federal grant, this is your best bet. For more information, visit

In addition to SBIR/STTR, a few other less technical grants are available through other federal agencies. You can find them at:

In addition, you may want to consider searching online for the terms “business grants” and the name of the federal agency that may need your goods or services.

That said, it’s probably better to think of these types of opportunities as federal contracts rather than free grants. If you do, the answer is yes, federal grant money is available.

Disclaimer: The content on this page is for informational purposes only and does not constitute legal, tax or accounting advice. If you have specific questions about any of these topics, seek advice from a licensed professional.