Small business grants for felons

You may be launching into a business venture out of passion — or a need to find equitable employment in a market where employers don’t favor your personal history. Unfortunately, this is a common scenario for people with criminal histories, so you’re not alone.

According to the Prison Policy Initiative, 62 percent to 65 percent of people formerly incarcerated remain unemployed each year after reentry into the job market. Unemployment is persistent for this group even four years after ending their sentence.

Because of this reality, many people formerly incarcerated turn to entrepreneurship as the answer. To help you get started, here’s a look at small business grants and additional resources for entrepreneurs with criminal records.

Grants for entrepreneurs with criminal records

Many grants don’t exclude people formerly incarcerated from applying. Here’s a list of small business grants that may be open to entrepreneurs with a record:

1. Grants.gov

This government-run search engine helps small businesses find grants and other types of funding. Its directory houses over 1,800 grants — most aimed at providing funds for a specific use. Grants come from government departments, such as the Department of Agriculture.

You won’t find grants specifically for business owners with a criminal record, but many don’t exclude those with a criminal history.

• Application process

  • Use the search engine’s filters to narrow down by your industry and type of business.
  • See if your business is eligible for any grants.
  • To apply for a grant, you’ll need to register an account with Grants.gov.
  • Contact the agency department offering the grant to ask that your account be affiliated with the agency.

2. GrantWatch

GrantWatch is a database that allows entrepreneurs, including those formerly incarcerated, to search for funding opportunities. Over 27,000 grant opportunities are available in the database, and more than 7,000 organizations and businesses are accepting applications from businesses, individuals and nonprofits.

• Application process

  To access GrantWatch’s database, entrepreneurs must subscribe. Paid memberships are available for $18 per week to $199 per year, or you can sign up for a free membership, which provides limited information.

3. SBA 8(a) program

This program, run by the Small Business Administration, could make your business eligible to bid for government work contracts. Through the SBA 8(a) program, the government aims to use disadvantaged businesses for at least 5 percent of its contract work. It also provides mentorship and technical support, such as for complying with regulations.

The program lasts nine years, much longer than most entrepreneur programs. Getting this long-term support ensures sustainability for your business.

The SBA does require business owners to show “good character” to qualify. So approval may be subject to the type of criminal history and other factors.

• Application process

  To apply for this program, you’ll need to:<br /><br />

  • Use the SBA’s eligibility tool to see if you’re eligible for this program.
  • Look up your NAIC code.
  • Register with the System for Award Management (SAM). You’ll receive a Unique Entity ID required to do business with the federal government.
  • Apply for SBA certification. Your business will need to be certified by the SBA.
  • Submit documents according to the 8(a) application checklist.

4. Fresh Start Business Grant

This private grant offered by Incfile offers $2,500 for aspiring business owners to use for startup costs. You must be at least 21 years old, and you’ll need to submit a business plan to show your projected growth.

Along with the grant, you’ll get access to Incfile Gold, which offers tax consultations and services to incorporate your business.

Incfile also offers a $2,500 grant for young entrepreneurs in high school, trade school or a university to apply toward education expenses.

• Application process

  • Apply directly on the website.
  • Upload a two-minute video about how entrepreneurship will influence your life.
  • Upload your business plan.

5. FedEx Small Business Grant

Started in 2012, the FedEx Small Business Grant awards grants to 10 winners each year. You must be a for-profit business that needs shipping services to be eligible.

Thousands of small businesses from all industries apply, from healthcare to snowboarding. So you’ll need a unique product or service to stand out to the judges. In 2023, the grant application deadline was in February, and winners were announced in May.

• Application process

  • Apply on FedEx’s grant contest page.
  • Open an account with FedEx. A business account number is required.
  • Check the timeline to see when winners will be announced.

6. Small Business Growth Fund

The Small Business Growth Fund awards $5,000 to $25,000 to eligible small businesses. Grant organizers are looking for small businesses that fit these qualifications:

• For-profit
• Based in the US or Puerto Rico
• Has less than $1 million in annual revenue
• Show how the grant will help them grow significantly

Hello Alice offers the grant in partnership with the Global Entrepreneurship Network (GEN), and it’s funded by Etsy and Progressive. Applications for the third round of grants close on October 27, with winners scheduled to be announced in November.

• Application process

  • Sign up for a free Hello Alice account.
  • Complete the application online.
  • Check back to see when winners are announced.

7. National Association for Self-Employed Growth Grants

The National Association for Self-Employed (NASE) offers Growth Grants of up to $4,000 for small businesses. It focuses on businesses with the potential to grow if given the capital to invest in new equipment, employees or other opportunities. Unlike most grants, NASE awards a new winner each month.

• Application process

  Register online to become a NASE member. You must keep your membership for the required amount of time:<br /><br />

  • Annual members can apply immediately.
  • All other members can apply after three months.

  Follow the instructions to apply online.

8. Comcast RISE Investment Fund

The Comcast RISE Investment Fund is designed to promote small business growth while focusing on diversity, equity and inclusion. The fund was created originally to support businesses recovering from the COVID-19 pandemic.

The fund was recently eligible for businesses in Baltimore, Detroit, Memphis, Philadelphia and Portland. A total of 100 winners will be awarded grants in each city.

This year, the grant awarded funds as well as:

• Consulting services
• Educational resources
• Creative production, media and technology services

• Application process

  • Create an account with Comcast RISE.
  • Submit an eligibility criteria form. This will notify you whether your business is eligible for the grant.
  • Submit an application.

9. State Trade Expansion Program (STEP)

The State Trade Expansion Program (STEP) is offered through the Small Business Administration to help businesses expand exports to international markets. The grant can help with costs related to expanding your business, such as upgrading e-commerce on your website, creating international marketing campaigns or going to trade shows.

You’ll need to keep detailed records of how you use the STEP funds and meet reporting requirements per STEP’s terms and conditions. For example, you’ll need to submit audited financial statements, quarterly reports and performance reports.

• Application process

  Open an account with Grants.gov and apply for the STEP grant online. The grant is offered by your state government.

10. Amber Grant

The Amber Grant targets all women entrepreneurs rather than formerly incarcerated entrepreneurs exclusively. Created by WomensNet, a nonprofit organization, the Amber Grant provides multiple grant opportunities to businesses with at least 50% ownership by women, with a monthly grant of $10,000 and an annual grant of $25,000.  The organization also awards a variety of monthly grants to nonprofits, startups and businesses operating in specific industries. categories.

• Application process

  To apply for any of these grants, submit a single application through the Amber Grant website.

11. Georgetown Pivot Program

Since 2018, the Georgetown Pivot Program has provided a comprehensive, one-year initiative aimed at equipping previously incarcerated individuals with the necessary skills for success in the business and professional arena. Participants have the chance to attend educational sessions and secure internships as well as participate in the Pivot Pitch Competition, where they’ll compete for startup funding. There is an emphasis on starting and running a business, but those focused on securing employment also receive assistance with their search.

• Application process

  Applicants must be 25 or older, have a high school diploma or GED and have been incarcerated within the last years. Interested entrepreneurs can contact pivot@georgetown.com to learn how to apply.

12. The Transform Business Grant

The Transform Business Grant supports entrepreneurs in marginalized communities with a $1,000 microgrant and a year-long business program. Transform, a nonprofit dedicated to making change by redistributing knowledge and resources, targets BIPOC individuals, those with disabilities, formerly incarcerated entrepreneurs and LGBTQ+ folks creating social impact.

• Application process

  Open to U.S. applicants regardless of immigration status, both individuals and groups can apply. Priority goes to those demonstrating financial need, defined as the inability to meet essential needs with available resources. During grant cycles, applications are made available online. Check back in 2024 to apply.

13. LEAP Virtual Entrepreneurial Academy

Florida nonprofit LEAP is focused on aiding women who have previously been incarcerated in their reintegration process. The LEAP Virtual Entrepreneurial Academy, which is a three-month program that operates biannually, teaches essential business skills to its participants. This free program is funded by sponsors, and upon program completion, entrepreneurs present their business plans to a panel of experienced entrepreneurs for the chance to secure cash prizes and apply for a $1,000 microloan.

• Application process

  Applications for LEAP Virtual Entrepreneurial Academy can be completed online.

14. Rise Up, Get Started Grant Program

The Rise Up, Get Started Grant Program is an offering from Determination, Incorporated, a Kansas City-based nonprofit organization that specializes in aiding formerly incarcerated entrepreneurs in navigating business ownership. The Rise Up, Get Started initiative is a year-long program where participants receive coaching, mentoring and community support with various business-related tasks, including business plan creation. At the program’s end, participants will have $300 saved for their businesses as well as receive a $750 grant from Determination, Incorporation.

• Application process

  Information about the 2023 Rise Up, Get Started Grant Program has not been released. Those interested in Determination, Incorporated’s Be the Boss Business Support Group Community for formerly incarcerated people can sign up online and receive updates.

Resources for formerly incarcerated entrepreneurs

Grants for convicted felons to start a business aren’t the only available options. Opportunities for felons to jumpstart or expand a business venture are out there. If you can’t find grant money for released prisoners, here are some other ways to accomplish your funding and entrepreneurial goals:

CareerOneStop

CareerOneStop, which is sponsored by the U.S. Department of Labor,is a one-stop platform that provides tools, tips and resources to formerly incarcerated entrepreneurs reintegrating into the workforce. The website provides a comprehensive range of services to support their journey.

Users can access job search tips and resources to help them find and apply for employment opportunities. The website also features tips on how to locate state resources, find employers hiring formerly incarcerated individuals and how to talk about your convictions with future employers.

Felony Record Hub

As an online resource for formerly incarcerated entrepreneurs seeking to rebuild their lives, Felony Record Hub offers guidance tailored to the unique challenges faced by those with felony records. It provides information on legal rights, housing and programs, as well as the job market to help people formerly incarcerated find employment.

With a quick search, users can review a list of employers, which includes Amazon, 20th Century Fox and Aldi, who support formerly incarcerated entrepreneurs seeking employment to help build up their finances to start a business.

Entre Capital

Entre Capital is a unique resource dedicated to supporting second-chance entrepreneurs. As a Community Development Financial Institution (CDFI), its efforts are focused on providing financial assistance exclusively to those with criminal records. Its loans are tailored to help these individuals start or expand their businesses. Entre Capital also helps with business planning, budgeting and financial reporting guidance and offers mentorship programs.

Help for Felons

HelpForFelons.org is an online platform that offers diverse resources to support people formerly incarcerated. One of the key features of this website is its job listings section, where formerly incarcerated individuals can explore employment opportunities and re-enter the workforce. However, grants and business loans are listed on the site for those more interested in entrepreneurship.

The site also provides legal information as well as featured housing opportunities, helping users better understand their rights as they navigate the complexities of the legal system and find stable living arrangements post-incarceration.

Inmates to Entrepreneurs

Inmates to Entrepreneurs has a strong commitment to helping people formerly incarcerated rebuild their lives. This nonprofit organization provides a range of valuable resources and opportunities to support individuals on their journey, including free, online and in-person business education courses.

These courses cover a wide spectrum of essential business topics, including business planning, financial management, marketing and more. Participants in their programs also have access to mentorship, networking opportunities and guidance from experienced entrepreneurs who have successfully navigated similar challenges.

Defy Ventures

Defy Ventures is a non-profit organization committed to transforming the lives of formerly incarcerated individuals. Each of its programs is designed to guide entrepreneurs in training. Through a blend of entrepreneurship, personal development and mentorship, Defy Ventures equips its participants with the skills and mindset to become successful business owners and community leaders.

Small business loans for felons

Lenders may not specifically bar people who were formerly incarcerated or those with a criminal history from applying for a business loan. But lenders assess a business owner’s character and may do so using personal information. If the lender sees delinquent financial accounts or certain convictions like embezzlement, they could deny the application. You may find loan or financing options from:

Educational Pell Grants

The good news is that people with a criminal history can get a Federal Pell Grant. You’re eligible even if you’re currently incarcerated in a local facility, are on probation or parole or are living in a halfway house. You can use Pell Grants for undergraduate college education or accredited trade schools to receive federal funding. Talk to the school’s financial aid office to see if they accept Pell Grants.

A few exceptions that will make you ineligible:

• Currently in a federal or state facility
• Convicted of a forcible or nonforcible sexual offense and required to complete an involuntary civil commitment

Second Chance Pell Grant

The federal government founded the initial Second Chance Pell Grant in 2015 to help those incarcerated get funding for eligible prison education programs.

The Second Chance program is designed to inform those incarcerated about their educational opportunities and help them apply for federal funding. It also helps them continue the program if they’re transferred to a new facility or released. Plus, the program offers transitional services as individuals re-enter the workforce.

But Congress recently reinstated eligibility for the Educational Pell Grant to include some incarcerated individuals under the Free Application for Federal Student Aid (FAFSA) Simplification Act in 2020.

A revised Second Chance Pell Grant program will now operate under the Experimental Sites Initiative (ESI). Current Second Chance programs can continue serving students for three award years as they work toward meeting new regulations.

Entrepreneurship programs for felons

Several nonprofit organizations help people with past convictions re-enter the workforce and start their own businesses through programs like:

Additional resources for formerly incarcerated entrepreneurs

One of the best ways to get support as a new business owner is to connect with local resources and business owners going through the same journey.

• Small Business Development Centers (SBDC). Your local SBDC provides training, mentorship and funding opportunities for small businesses.
• SCORE. SCORE is a small business mentoring and resource program offered through the Small Business Administration. It offers free, one-on-one mentoring from a local business expert near you. It also offers training events, webinars and a Startup Roadmap course to help you get your business idea off the ground.
• Local grant or entrepreneur programs. Search for local grants, nonprofit organizations and programs designed to help small business owners succeed. State websites may provide a list of grants dedicated to specific purposes.

Frequently asked questions

• Can felons get credit cards?

  Yes, felons and those with a criminal record can get credit cards. But an extended incarceration could lower your personal credit score if you haven’t used different forms of credit in a while. Your credit score is affected by factors like your recent payment history and amount of credit used.

• What disqualifies you from getting an SBA loan?

  The SBA doesn’t approve loans for those currently incarcerated for a crime or those on parole or probation. Any business engaged in illegal or speculative activities are ineligible, as well as those in specific industries. Ineligible industries include gambling, investment, lending, multilevel marketing, dealers of rare coins, nonprofit or religious organizations or government entities.

• Can a felon start an LLC?

  Yes, a felon can start a business organized as a limited liability company (LLC). To fund the business, you may be able to get an LLC loan, though you’ll need to make sure that you meet the lender’s minimum qualifications, such as time in business.