How to get grants for your Green business
Grants are an important source of capital for green businesses, as they provide much needed funding for product development and market testing. Competition for the grant money is stiff, and less than 10 per cent of the applicants actually succeed in getting grant funding; the good news is that grant programmes supporting green businesses are on the rise. For example, UNDP has recently announced a new programme for enterprises that are combating ocean pollution, Bill and Melinda Gates Foundation has added climate change to their list of causes and Amazon founder Jeff Bezos has pledged $10 billion to fight climate change through the creation of the Bezos Earth Fund.
Writing a grant proposal is actually much easier than creating a pitch deck or other investment collaterals, as grant providers provide detailed information about their requirements including their mission, evaluation parameters, list of past awardees etc. Some of the grant providers even host webinars to help applicants understand their eligibility. Many grants require candidates to submit pre proposals (summary proposals) before submitting detailed proposals to save them the trouble of going through unworthy proposals.
Successful grant proposals focus on establishing their fitment to the grant objective, scalability of their proposed project, survival beyond grant period and their ability to measure the impact. Additionally, a funding worthy proposal also tells a compelling story…read on to know more!
There are four main principles to be adhered to while preparing your grant application:
1. Align the proposal with grant provider’s objectives
Most grant providers that fund green businesses are looking to create impact in fighting climate change, developing renewable energy resources, circular economy and poverty alleviation. Additionally, each award has a specific objective such as improving energy access for low income consumers or generating livelihood through circular economy (see Table 1).
Table 1: Examples of Grant programme objectives
Since grantors are only seeking impact (no monetary returns), they care a great deal about the grantees’ ability to make desired impact and do not consider proposals that are not aligned to their areas of interest. Grant program reviewers are trained to spot inconsistencies in your proposal, such as lack of coherence between the proposal and past projects, so as to quickly eliminate undeserving proposals. Grantors are looking to solve large problems and as such, a well written proposal should also outline the significance of the problem being addressed and why you are interested in solving that problem.
Therefore, the first principle of grant application is to understand if your project really fits into the grantors’ agenda. For example, if a grant award is for companies that are creating data about plastic waste, a plastic waste recycling project won’t fit the bill. Similarly, for a grantor looking to improve rural mobility, grant application from an urban mobility company (that may have plans of facilitating rural mobility also) may not qualify. Sometimes, grants are provided for market demonstration/customer trial and companies that don’t have a minimum viable product may not be considered.
2. Ensure scalability and survival of project beyond grant period
Grant providers look for evidence for their impact to last beyond the grant support. To be sustainable, the project should either generate enough revenues to cover its expenses or it should be able to attract funding from a number of funding partners. Therefore, many grant /award platforms also assist the grantee companies in meeting other investors. As such , the second principle is to demonstrate susitanability of your proposal through the following
- Business strength — highlighted through traction, cost savings, product/service strengths
- Break up of funding needs — Fixed investments and operational expenses
- Time/number of customers required to be profitable/recover costs
- Expected partnerships with other funders/Government agencies
- Team’s past experience in delivering similar/related project
3. Describe how outcomes will be measured and achieved
Outcomes measured are outcomes achieved. Outcomes refer to the impact created by the project and are different from outputs which signify services or products delivered. A good grant proposal not only discusses the outcomes but also specifies the indicators that are used to measure the same (See Picture 1). Grant applications typically require concise answers, with word limits per question. As such, use the space judiciously in first establishing the connection of your project outcomes with the grant objectives and then in specifying relevant milestones to measure progress.
Picture 1. Project outputs and outcomes
4. Start the proposal early
One of the best practices of grant writing is starting early so that you have enough time to polish the draft. Many grant proposals require you to submit attachments such as video, pitch deck or pictures of prototypes and so starting early also allows you time for preparing these attachments. It is also recommended that you get your proposal reviewed by someone outside the industry, to improve its readability and reduce redundancies.
In summary, adhering to the above four principles can result in a well thought out proposal that would create a favourable first impression. This, in turn can significantly increase your chances of getting funded and put your business on a fast track growth path.
