How to Start a Grant Writing Business

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Our guide on starting a grant writing business covers all the essential information to help you decide if this business is a good match for you. Learn about the day-to-day activities of a grant writing business owner, the typical target market, growth potential, startup costs, legal considerations, and more!

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Start a grant writing business by following these 9 steps:

You have found the perfect business idea, and now you are ready to take the next step. There is more to starting a business than just registering it with the state. We have put together this simple step guide to starting your grant writing business. These steps will ensure that your new business is well planned out, registered properly and legally compliant.

STEP 1: Plan your Business

A clear plan is essential for success as an entrepreneur. It will help you map out the specifics of your business and discover some unknowns. A few important topics to consider are:

  • What are the initial costs?
  • Who is your target market?
  • How long it will take you to break even?
  • What will you name your business?

Luckily we have done a lot of this research for you. Skip on ahead to the Business Overview for more detailed answers to all your questions.

Choosing the right name is very important. We recommend checking if the business name you choose is available as a web domain and securing it early so no one else can take it.

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STEP 2: Form a legal entity

Establishing a legal business entity such as an LLC prevents you from being personally liable if your grant writing business is sued. Consider using a registered agent service to help protect your privacy and stay compliant.

STEP 3: Register for taxes

You will need to register for a variety of state and federal taxes before you can open for business.

STEP 4: Open a business bank account

Using dedicated business banking and credit accounts is essential for personal asset protection.

When your personal and business accounts are mixed, your personal assets (your home, car, and other valuables) are at risk in the event your business is sued. In business law, this is referred to as piercing your corporate veil.

STEP 5: Set up business accounting

Recording your various expenses and sources of income is critical to understanding the financial performance of your business. Keeping accurate and detailed accounts also greatly simplifies your annual tax filing.

STEP 6: Obtain necessary permits and licenses

Failure to acquire necessary permits and licenses can result in hefty fines, or even cause your business to be shut down.

STEP 7: Get Business Insurance

Insurance is highly recommended for all business owners. If you hire employees, workers compensation insurance may be a legal requirement in your state.

STEP 8: Define your brand.

Your brand is what your company stands for, as well as how your business is perceived by the public. A strong brand will help your business stand out from competitors.

STEP 9: Establish your Web Presence

A business website allows customers to learn more about your company and the products or services you offer. You can also use social media to attract new clients or customers.

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Select your state below for an in-depth guide on completing each of these steps in your home state.

Business Overview

Owners of grant writing businesses are adept at finding foundations, government entities and other funding sources and applying for funding on behalf of their non-profit clients. You will, in short, serve as a matchmaker, putting together funding sources and needs. You’ll continually seek grant opportunities and write succinctly, persuasively and in an organized manner in filling out requests for proposals (RFP) to win funding.

Who is this business right for?

Your talents will involve business writing and a clear understanding of the non-profit and funding worlds. In your writing, you must be able to take direction well because each RFP to which you respond requires clear and direct answers and attention to such details as word or page counts, writing style and, on occasion, even font and type size regulations.

It also helps if you currently volunteer, or have done so in the past, with non-profit organizations, or can network comfortably within that environment.

What happens during a typical day at a grant writing business?

You’ll maintain regular phone, digital and face-to-face contact with nonprofits and grant makers at foundations and other funding sources. You’ll spend significant time researching new funding opportunities and nurturing relationships in the funding community.

You should also have a regular social media presence to salute your nonprofits and foundations with which you’ve established contact and to promote your own achievements in securing funding.

During busy times, much of your day will be spent researching grant makers and filling out RFPs. You should also meet other grant writers at networking events with whom you could strike up successful partnerships or seek contract help during busy times.

What is the target market?

You’ll want to meet decision makers at non-profit, community and civic organizations, and occasionally even for-profit entities and others seeking to raise funds through grants. While some grant writers seek clients of all kinds, others focus on a preferred type. That might be organizations working to treat specific medical conditions or to advance a political or civic objective, or perhaps non-profits based within your geographic region.

How does a grant writing business make money?

You’ll generate revenue by charging clients a per-hour or flat rate for your various services. As you win grants and your reputation grows, more businesses will come in and you can increase your hourly or project rates.

What is the growth potential for a grant writing business?

The more clients you add to your roster, the more income you might generate. Success breeds success in this industry. While every grant request is a longshot since so many nonprofits are competing for the same funding, grant writers who are recognized as being particularly successful are best positioned to win new business. That’s why it’s incumbent upon you to publicize your wins through social media and self-marketing opportunities.

As your business grows, you can consider hiring additional writers or others who are networked into the non-profit or funding communities to help you generate additional clients or grantmaking sources.

What are some skills and experiences that will help you build a successful grant writing business?

Your success will be built upon the proficiency of your writing within this area of expertise and your ability to navigate the nonprofit world. You must be socially adept and able to work the politics of your two communities—nonprofits and funders.

What are the costs involved in opening a grant writing business?

Your startup costs should be minimal since you can work from your home and without employees at first. Let’s look at some possible startup costs.

  • Home office equipment—Your phone, computer and printer can be obtained for $1,000 if you don’t already own them.
  • Rent—Your first office is likely to be your home or apartment. If that’s too distractive, seek office space for one person in a modest space. Meetings can be held at client locations, so you don’t have to impress with your office. Depending on where you’re located, rent could be as little as a few hundred dollars a month and shouldn’t exceed $1,000.
  • Employee costs—You’ll likely be your sole employee, at least at first. What’s the least you can get by on? You might feel more financially secure if you have a working spouse, have saved a year’s salary beforehand or go into your business with at least one client signed up.
  • Professional services—See a lawyer and an accountant before startup to draw up contracts and advise on expenses and taxation issues. This might be a $500 investment or more depending on the complexity of your business.
  • Promotional and marketing materials—This includes everything from your website and blog to social media presence, business cards, logo development and collateral sales materials. Much of this can be done at low cost. For instance, your website and blog can be developed cost-free if you have basic digital skills, and you could find a competent graphic designer at your local community college. The investment of $500 to $1,000 should be enough in this area to launch your business.
  • Accreditation, memberships and licensing—Networking within your industry can cost as much as $1,000. While not mandatory, this can be a valuable investment in credibility and a source of critical relationships. Ask your lawyer or accountant if you’ll face any licensing or permit fees in your locality.

Where can I find a business mentor?

One of the greatest resources an entrepreneur can have is quality mentorship. As you start planning your business, connect with a free business resource near you to get the help you need.

Having a support network in place to turn to during tough times is a major factor of success for new business owners.

What are some insider tips for jump starting a grant writing business?

Don’t go into this field unless your business writing skills are impeccable. That said, you should also have entrée in the nonprofit world. You might gain this knowledge with a background in a non-profit organization, working as an in-house writer or in some other area of expertise as either a staffer or volunteer.

Also consider learning more about the specifics of grant writing through various web articles and online training programs or through industry groups and trade organizations. These include National Grants Management Association (NMGA), Grant Professionals Association (GPA) and Grant Professionals Certificate Institute (GPCI).

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Growing Your Business

How to promote & market a grant writing business

Use social media and self-promotional marketing materials to expound on your abilities and to highlight your accomplishments. You’ll also want to spend equal time engaging prospective clients and the funding sources that will serve their needs. Get involved volunteering within your target industry, attend fundraisers, sit on boards and otherwise interact with your audience and get to know decision makers.

Recommended: Get started with local advertising for your business with a $300 credit from Yelp.

How to keep customers coming back

It’s your grantmaking “wins” that will attract new clients and maintain the interest of your existing roster. However, this is only partially within your control. Every grant proposal you write must be comprehensive, logical and persuasive—and you still might not land the grant. That’s because of the intense competition for funding.

This fact underscores the need for self-promotion when strategically beneficial. Use social media to highlight your victories. And be sure to ask your clients to recommend you to others potential clients. It’s a small, insular community, putting you at an advantage if you can offer prospective new clients the commendation of people they know and respect.

How and when to build a team

One reason you need to network regularly is to meet other talented writers and insiders in the world of nonprofits and funding sources. You can expand gradually, as opportunity presents itself. If, at first, you have an excess of work, consider contracting with freelance grant writers to undertake parts of projects.

Only when you see that your business growth is ongoing, rather than a cyclical bump, should you consider part-time or full-time hires. You can also explore expansion through partnerships with other successful grant writers as a way to gain access to new client types or funding sources.

Legal Considerations

State & Local Business Licensing Requirements

In most states, grant writing businesses must obtain business permits. Learn more about licensing requirements in your state by visiting SBA’s reference to state licenses and permits.

Most businesses are required to collect sales tax on the goods or services they provide. To learn more about how sales tax will affect your business, read our article, Sales Tax for Small Businesses.

In addition, certain local licensing or regulatory requirements may apply. For more information:

Maintain Personal Asset Protection

Don’t think that just forming an LLC, or any other type of business, will save your personal assets in case of a lawsuit or other matter by itself.

When your personal and business accounts are mixed, your personal assets (your home, car, and other valuables) are at risk in the event your LLC is sued. In business law, this is referred to as piercing your corporate veil.

Two of the simplest steps that will protect your business, and yourself, are to:

Open a business bank account

  • This separates your personal assets from your company's assets, which is necessary for personal asset protection.
  • It also makes accounting and tax filing easier.

Get a business credit card

  • This helps you separate personal and business expenses by putting your business' expenses all in one place.
  • It also builds your company's credit history, which can be useful to raise money and investment later on.
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To learn more about maintaining your LLC's corporate veil, read our guide and protect your personal assets.

Services Contract

Grant writing businesses should have a service contract between themselves and their clients to make the exchange of grant writing services for payment transparent. Here is an example service agreement.

Recommended: Rocket Lawyer makes it easy to create a professional service agreement for your grant writing business when you sign up for their premium membership. For $39.95 per month, members receive access to hundreds of legal agreements and on call attorneys to get complimentary legal advice.

Earning Potential

How much can you charge customers?

Grant writers with little experience and few clients might charge as little as $25 an hour, while a rate of between $50 and $100 hourly is earned by those with more experience. Some grant writing businesses charge a flat fee for individual services. For instance, this business charges $3,500 for a grant proposal that can serve as a foundational document for responding to RFPs. The company charges additional fees for RFPs and basic funding-source research.

What are the ongoing expenses for a grant writing business?

Your ongoing expenses can be quite modest until you’re primed for growth. At that time, you’ll need an office (or one that’s larger than your current site) and you’ll undertake employee expenses.

At first, your most pressing need will be to meet your own income and healthcare demands. Other ongoing expenses will include event attendance, lunches, travel, entertainment and other costs associated with meeting clients and funders.

One source estimated that operational expenses for grant writers might take up 25-50 percent of revenue.

How much profit can a grant writing business make?

The compensation data website Payscale estimated that in-house grant writers earn an average annual income of about $45,000. Use this as only a starting point, because those who work on their own have more control over their income. It will only be limited by your success in generating clients, nurturing funding source relationships, winning grants and marketing your successes.

How can you make your business more profitable?

Some non-profit organizations employ in-house writers but still need help with other aspects of grant seeking. Consider breaking down your various services and offering non-profits who might not be interested in your full menu of services a cafeteria option. This might include such related services as funding research, training and writing consultancy.

Next Steps

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