Business Startup Grants to Help Your Business Idea Flourish
Often, you’ll need some financial help to get started with your new business if you want to see it become the success you know it can be. This is why we’ve provided a guide on some of the business startup grants you can apply for in the UK, so you can decide who you should turn to when you need to get an idea off the ground.
What is a Startup Grant?
A grant is a sum of money given by the government or another organisation for a particular purpose. This is often without the expectation of repayment. A startup grant, therefore, is money provided to someone who is self-employed, registering a limited company, or in a partnership with the intention of helping a company to develop and grow.
Different organisations may offer different grants and funding, based on a number of different factors. For instance, you may find funding from one firm if you are over 50 and starting again with a new business. Others may be looking for green schemes and environmentally friendly initiatives, and will only supply funding for these.
Some grants may only be offered on the condition that you invest an equivalent amount in your business.
Government Grants for Startup Businesses
There are a number of grants, schemes, and startup loans available from the government to help you get your new business started. In most cases, the first you’ll apply for will be the Start-Up Loan. This is an unsecured personal loan which ranges in size from £500 to £25,000. To apply, you’ll need to meet the following criteria:
- You must be over 18
- You must live in the UK
- You already have (or are planning on starting) a UK-based business that’s been trading for under 2 years (less than 24 months)
Whether you are over 50 or under 25, self-employed or entering a partnership, or even starting a green organisation with the funding, you will be able to apply for this loan.
Start-Up Loans have a fixed interest rate of 6% per year. This can be paid back over a period of one to five years, with no application fee and no early repayment fee.
Business Grants for the Unemployed
If you are currently unemployed, you may be able to start your own business through the New Enterprise Allowance (NEA). If you are eligible for this grant, you’ll receive mentoring and an allowance that should soon see you becoming self-employed.
To be eligible, you’ll need to be over 18 and either:
- A lone parent, or sick or disabled and on Income Support
- Receiving Universal Credit, Job Seeker’s Allowance, or Employment and Support Allowance (or have a partner who does)
Any business plan you use to apply for this grant will need to be approved by a mentor. After this, you may get an allowance of up to £1,274 over 26 weeks.
Taking on an Apprentice
If you have a small business and you’re planning on taking on an apprentice, you may be able to get help from the government to train them. You won’t pay the apprenticeship levy if your pay bill comes out at less than £3m a year, meaning you’ll get 5% towards the costs involved with training your apprentice.
The government will pay its 95% share directly to the training organisation. Similarly, you’ll have to pay your own share directly, according to the schedule you’ll have previously agreed with the training organisation. You can apply for this funding on the government website.
Businesses who create jobs for 16 to 24-year-olds on Universal Credit who are at risk of becoming unemployed may also be granted funding through the government’s Kickstart Scheme.
Trusts That Offer Grants and Funding
There are many trusts across the country that can offer your business start up loans. If you are aged between 18 and 30, the Prince’s Trust may be the organisation for you to turn to. They can provide you with the funding and resources you need to get started with a small business, and can also provide training and mentoring if this is needed.
In response to COVID-19, the Prince’s Trust also set up a £5m Enterprise Relief Fund, which offered grants to self-employed people and business owners aged between 18 and 30.
While this has now closed for applications, the Prince’s Trust is also running an Enterprise Course, which offers workshops and information sessions to help launch business and startup ideas. You can also apply for low-interest business loans between £500 and £5,000, and the trust states that small business grants may also be available in certain circumstances.
To find out more about the Prince’s Trust and what it can offer you, please go to the organisation’s website.
Large Organisations Offering Business Finance Grants
A number of larger UK businesses and organisations may be able to get involved and offer you the financial support you need to get your business started. Some of these may depend on the sector you’re going into:
- The National Lottery Heritage Fund will support heritage projects, from cultural traditions to designed landscapes. The grants from 2021-22 will prioritise local business ideas that boost the area’s economy, encourage skills development, and support wellbeing and job creation
- Research and Development tax reliefs will support companies carrying out research or developing an advancement in their field. This even applies if the idea is unsuccessful in the end
- Innovate UK can provide government grants to “develop and realise the potential of new ideas, including those from the UK’s world-class research base”
Local Business Startup Grants for Your Area of the UK
Most other forms of funding for new businesses can be found locally, depending on where you’re based in the UK. The funding you’ll find open to you may also depend on the industry you work in, the size of your company, and whether you’re looking to grow your business or start it up as a new venture.
The UK Government offers an online tool that allows you to filter out potential grants before you start any application process, so you can apply for one that suits the needs of your small business or startup idea. You’ll also be able to pick and choose based on your industry, how long you’ve been trading for, how many employees you currently have, and your region of the country.
Some of these grants may be specific to certain cases, such as funding for people who are over 50 and just getting started with a new business. You may also find grants for particular causes. For example, you may be given funding by a trust in your local area if you’re planning on using it to set up a green initiative, such as planting woodland or investing in renewable energies.
To find out more about the grants you could receive from a local business in your area, see the government’s page on finance and support for your business. You can also find out more about business startup grants in each of the UK nations on these websites:
- If you are based in England, you can search for support for your business on the Local Enterprise Partnerships (LEP) website
- If your business is located in Scotland, you may be able to apply for a grant from Scottish Enterprise
- There are several methods for getting startup loans for new businesses that are already up and running in Northern Ireland, each of which are listed on the Established SMEs Funding section of Enterprise Ireland
- If your business is based in Wales, you can use the Welsh Government’s Funding Locator to apply for government grants, or to find funding and startup loans from local authorities and charities
Will Your New Business Need its Own Premises?
If you’re starting a business and you want the money you’re currently making to go that little bit further, you may be able to save on costs by renting a space instead of buying. This is because you won’t have to worry about extra fees, such as the costs involved in building maintenance or setting up the phone lines.
This is something our team at Halkin can guarantee for new businesses. By getting in touch with us and setting out your specifications, you’ll soon be able to choose the perfect space in London to transform your small business into the success you know it can be. We’ll even help you to move into a new office, should the original space no longer suit your needs.
Alternatively, if you’re only in the earliest stages of planning and need a meeting room to host potential investors, we can loan you the space that will make the best impression possible. Contact us and we’ll be happy to discuss this with you in plenty of time for you to schedule your meeting.