Grants and non-dilutive funding: money that costs no equity.
Grants and research contracts pay for work without taking a share of your company. They cost time, paperwork and rules instead. Here is how agencies review and how to apply well.
At a glance
Stages
Pre-seed to seed
Pre-seed · Seed · A · B+ · Growth
Decision time
Months
Set by solicitation and review cycles
Who decides
Reviewers, then agency
Scored by experts; program staff decide
Equity given
None
You owe reports and rules, not shares
What non-dilutive funding is
Money you do not pay for with equity: government grants and research contracts, foundation awards, some state and local programs, and prizes. It suits work with real technical risk.
In the US, SBIR and STTR are federal programs that fund research and development at small businesses through several agencies. STTR requires working with a research institution.
The money comes with strings: eligibility rules, allowed costs, reporting and deadlines. Rules and dates change, so always check the agency's current notice before you plan around them.
Federal grants and contracts
Research funding from US agencies, including SBIR and STTR. Peer review, strict rules.
Foundation and nonprofit grants
Mission-driven funders. Smaller processes that favor a tight fit with their cause.
State and local programs
Grants, matching funds or credits to build companies in that state or region.
How agencies review
A published solicitation
Agencies post topics, rules and deadlines. You answer one; you don't pitch.
Eligibility and compliance
Size, ownership and registration checks. Miss one and you are out unread.
Expert review
Reviewers score innovation, feasibility, team and commercial potential.
Agency decision
Program staff weigh scores, budgets and priorities, then pick awards.
Award and reporting
Budget negotiation, then progress reports and audits of how you spend.
What they look for
Real technical risk
Work that needs research, not just engineering time.
A clear, measurable plan
Aims, methods and what success looks like.
A qualified team
The right expertise, or partners who fill the gaps.
A path to market
Who buys it, and why it matters beyond the lab.
Fit with the agency's mission
Their priorities, in their language.
A budget that follows the rules
Only allowed costs, clearly justified.
How to apply
You win a grant on paper, not in a meeting. Talking to the right people first still shapes a better proposal.
The program officer
Register with the required federal systems early. Deadlines and rules change, so check the agency before you start writing.
- The agency's program officer
- A university tech-transfer office
- A grant writer or consultant
- A state small-business center
Pair your grant with an investor-ready deck.
Grants fund the research. Investors fund the company that sells it. We check your problem, technology and commercial path slides. You get a score and the three slides to fix first.
Questions founders ask
Do grants dilute my ownership?
No. A grant does not buy shares. It does bring obligations, such as reporting, spending rules and sometimes IP or data terms. Read the award terms with a lawyer.
Am I eligible for SBIR or STTR?
Generally these are for US small businesses that meet ownership and size rules, and the rules differ by program and agency. Check the current notice from the agency you plan to apply to.
Should I hire a grant writer?
It can help with format and compliance, but the science and the plan must come from you. Ask about their record with your agency and how they charge.
Do investors like grant funding?
Many do. It extends runway without dilution and shows experts reviewed your work. They will still ask how the company makes money after the research.
Sources
Sources: US federal agency program notices, including SBIR and STTR; state economic development agencies; foundation guidelines. Editorial content, reviewed quarterly. Not financial or legal advice.
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