Barriers to funding: The most common eligibility requirements

  • August 24, 2021

If you have begun the process of looking for non-dilutive funding opportunities for your small business it is likely that you have already encountered some of the common barriers to eligibility that funders create. We started covering this topic in 2017 ( and we still get many client inquiries on the subject. Here are some of the most common barriers you are likely to encounter on your search for funding.

Location-based Barriers

Many funders place barriers on eligibility based on location. These funding opportunities generally only serve a certain country, state, county, town, or area. This is true of certain federal grants and contracts as well as most of the more recent COVID-19 funding opportunities that have arisen as a result of the pandemic. Accelerators and incubators as well as some pitch competitions also have geographic eligibility barriers. Many require businesses to move to a certain location or to remain in a certain location for the duration of programming.

Industry specific funding

Some funding opportunities only serve specific industries. This is true of pitch competitions, accelerators, incubators, and federal funding opportunities. In fact, most funding places restrictions on what kind of projects it is willing to fund and what kind of industries it is willing to serve. Read the solicitation carefully to determine the funder’s areas of interest.

Entity Barriers

Each funding opportunity places barriers on what kind of entities they are willing to fund. Some will only fund non-profits, while others will only fund small businesses. Still, others will only fund municipalities, tribal organizations, or educational institutions. This type of eligibility is always disclosed in the Funding Opportunity Announcement (FOA).

By invitation only

Some funders only want to review applications from invited parties. You may be wondering how to obtain an invitation. Luckily, the majority of by invite-only funding opportunities welcome Letters of Intent (LOI) at certain times throughout the year. If they like what is in your LOI, you may be invited to submit a full proposal. The popular National Science Foundation Small Business Innovation Research grant is one example. They require a project pitch that must be accepted before businesses can submit a full proposal.

We work with high-growth startups and organizations that support the startup and innovation ecosystem. We build highly specific non-dilutive funding menus, provide proposal preparation services, and measure outcomes of funding through evaluation. Schedule a consult call with us HERE.