3 Sources of Funding for College Entrepreneurs
Jillian Sanders
If you’re starting up your first business venture, finances are certainly on your mind. Do you find yourself with an incredible idea, but minimal funding to support it? If so, it may be important to do some research on opportunities for potential financial support for budding entrepreneurs. There are three main categories of funding opportunities that are worth checking out: scholarships, loans, and grants. All have the potential to transform your company, though one may pertain to your particular business needs over another. Let’s take a closer look at each one of these.
Scholarships not only provide support for your business venture but are also great for networking. Larger corporations can become familiar with you, and especially through the application process, can see how you write and communicate your ideas to your target audience. Scholarships are one of the more straightforward ways of receiving financial support, in comparison to applying for a loan or a grant. Companies use scholarship applications to attract new employees and partnerships as well, so they often need you as much as you need them!
In the digital era, we are currently in, many are self-employed with completely remote work. Much of the hiring process can take place online, so businesses have to find creative ways to acquire new employees and stand out within the increasingly competitive job market. Companies are starting to create their own scholarships as a way of fostering community and boosting engagement, so it is important to be constantly on the lookout for new scholarship opportunities.
If you are working on your venture, it may be smart to consider scholarship creation for your own business for the future.
Scholarship Owl is an online platform that helps businesses establish a scholarship and connect to students. The software has a user interface that guides you through criteria and also works through the legal documentation required to make a scholarship official. It is also cost-effective!
Some scholarship examples targeted towards entrepreneurs include:
NASE (Nat’l Association for the Self-Employed) Future Entrepreneur Scholarship
Provides up to $24,000 for students who demonstrate independent employment skills
$12,000 awarded within the first year, $4,000 for the next 3 years of study
Chosen based on financial need, leadership ability, academic success, via recommendation, etc.
NASE also has Succeed Scholarships: up to $4,000 for students seeking continual education, which helps cover costs of licensing and certification too
NFIB (Nat’l Federation of Independent Business) Young Entrepreneur Foundation
Several awards for students attending trade school, community college, or 4-year colleges/universities
One winner receives up to $10,000 through Young Entrepreneur Awards Program, four regional winners receive $5,000
Evaluated based on business experience, GPA, and standardized test scores
TUN (The University Network) The Business Plan Scholarship
$1,000 awarded to one aspiring entrepreneur
The application process includes an essay prompt about personal motivations to get a business running
These are just a few examples of scholarship opportunities specifically targeting college entrepreneurs. More and more scholarships are becoming available, so be sure to surf the internet for those! Some websites made to help you find applications include:
Next, let’s talk about loans. Small business loans can be difficult to obtain but are definitely worth checking out. With a good credit score, collateral, and a strong plan for your business, you could be a valuable candidate for a small business loan. Loans tend to be geared towards students who have already developed a business venture that is working to hire more employees and increase their revenue. It is important to be cautious with what bank/institution you may be working with, as some may try to take advantage of college students that are ‘less experienced’.
There are various websites out there that compare the best small business loans on the current market. Many loans are filtered by credit score, average monthly revenue, and the amount of time your business has been operating. Some of these sites include:
Fundinghero.com (Best Small Business Loans in [state] April 2023)
Smallbusinessloans.com
SBA.gov
An example of a small business loan is American Express’ Business Line of Credit. It requires you to be at least 18 years old to apply, have started your business at least one year prior, have a FICO score of at least 640, and an average monthly revenue of at least $3,000. For small ventures, this can be more attainable than other loans on the market, with its quick application process, term length options, and straightforward fees.
Loans can be a bit more difficult to navigate in comparison to scholarship opportunities, but let’s talk about the third source of funding for college entrepreneurs: grants.
Grants can provide a lot of money at one time and are perfect for startup organizations, but depending on the amount awarded, can be more short-term. A pro of using grants is that the money does not have to be repaid in any capacity, so it is an efficient method of funding, though the research and application process can be more time-consuming.
There are grants for just about everything, but some geared toward entrepreneurship include:
U.S. Small Business Administration State Trade Expansion Program (STEP)
Financial awards are given to local governments which distribute them to small businesses
This one in particular involves small businesses with the intent of international trade
The application process varies from state to state
Hello Alice Small Business Growth Fund
Provides up to $5,000 in scholarships, virtual events with industry professionals, and professional development guidance
Join Hello Alice to apply at the end of every calendar year
Incfile Entrepreneur Grant
Young Entrepreneur Scholarship Grant, $2,500 for continual education, as well as private sessions with an Incfile business expert
Fresh Start Business Grant, $2,500 for startup costs
SoGal’s Black Founder Startup Grant
$10,000 and $5,000 grants to black women and nonbinary entrepreneurs
Must have legally registered business, hopes of investor financing, and a high-impact business idea to apply
Additional mentorship opportunities are available
Scholarships, loans, and grants are three of the most straightforward ways of gaining funding for your newest business venture. Remember that rejection is redirection; if the funder chooses not to provide assistance, know there are so many other resources out there! Each form of funding has its pros and cons, so be sure to do the research on which one works best for your business model. Best of luck to all the budding entrepreneurs out there!
