10 Best Small Business Grants in California

How do small business grants work in California?

Small business grants are financial awards given to help entrepreneurs grow a small business without taking on debt. For California small businesses, grant programs often focus on specific industries or groups, such as minority and women-owned businesses, tech startups, or projects that promote clean energy or job creation. Eligibility requirements vary, but they may include your business plan, location, or how your operations will benefit the economy or community.

Types of grants for California small businesses

Small business grants in California cater to the unique needs, industries, and goals of the state’s businesses. Here’s a breakdown of the most common types of grants available in the Golden State.

• Federal grants. Popular grants from federal agencies include the Small Business Innovation Research (SBIR) and Small Business Technology Transfer (SBTT) grants. Federal grants aim to stimulate technological innovation, research, and job creation.
• State business grants. You can find state-funded grants through agencies like the Office of Business and Economic Development (GO-Biz), the California Department of Education, and even the California Department of Fish and Wildlife. They encourage small business growth in key areas like renewable energy, rural development, or minority entrepreneurship.
• Private business grants. Private small business grant programs are funded by corporations, foundations, or industry organizations. They often target specific groups, like women-owned businesses or veteran entrepreneurs.
• Research and development (R&D) grants. R&D grant programs are for small business innovation research. In California, tech startups can benefit from programs like the SBIR or grants offered by private organizations.
• Nonprofit and community development grants. These grant programs are for small businesses or organizations focused on community improvement, like education, housing, or healthcare. Local governments and private foundations often fund these programs.
• Industry-specific grants. Some grant programs are tailored to California small businesses in specific industries, like tech, agriculture, renewable energy, or entertainment. Trade associations and industry groups often provide these grants.

10 best small business grants in California for 2025

California offers a variety of small business grant programs tailored to unique industries and needs. Whether you’re running a tech startup, a local restaurant, or a nonprofit, here are some of the top small business grants in California.

1. California STEP Grant

The California State Trade Expansion Program (STEP) helps small businesses enter international markets. Administered by GO-Biz, it provides export vouchers covering up to 75% of approved expenses, such as export credit insurance, compliance testing, foreign patent and copyright registration, and international trademark registration. Eligible small businesses can receive up to $10,000 per year. 

Eligibility requirements:

• For-profit businesses in good standing in California 
• Established companies with significant business operations in California
• Exports goods or services with at least 51% U.S. content
• Meets small business size standards set by the Small Business Administration (SBA)
• In operation for at least one year

2. San Francisco Women’s Entrepreneurship Fund

The San Francisco Women’s Entrepreneurship Fund supports women-owned small businesses that have low to moderate income and are enrolled in the city’s technical assistance program. The grant provides up to $5,000 for projects that drive economic growth in San Francisco, including business needs like marketing, equipment upgrades, workforce development, and space improvements.

Eligibility requirements:

• Woman-owned business operating full-time in San Francisco
• Annual income between $27,755 and $500,000
• Complete the grant application process through your business’s technical assistance provider (see the San Francisco Small Business Development Center to apply for the technical assistance program)

3. Route 66 Extraordinary Women Micro-Grant

The Route 66 Extraordinary Women Micro-Grant supports women-owned small businesses along Route 66, helping existing businesses stay open, reopen, or expand. Awarded three times annually, each grant provides up to $2,000 to eligible businesses working to preserve Route 66’s historic character and empower local entrepreneurs.

Eligibility requirements:

• Registered California business in good standing
• At least 51% women-owned or operated
• Located on Route 66 or in a nearby community
• Fewer than 20 full-time employees
• Independently owned (franchises with up to five locations qualify)

4. CalCRG

The California Community Reinvestment Grant (CalCRG) supports nonprofit organizations that help underserved communities affected by the war on drugs. This includes major counties in California like Los Angeles, San Diego, San Francisco, Riverside, Imperial, Fresno, and Kern counties. Grant funds range from $600,000 to $3 million, and the application process focuses on job placement, mental health services, and substance use treatment.

Eligibility requirements:

• Community-based nonprofit organization in good standing with the state
• Provides services like job placement, mental health, or legal aid
• Operates in an eligible county

5. California Arts Council Grant Program

Another program for nonprofit organizations, the California Arts Council Grant Program, focuses on the arts. This grant funds eligible businesses that run a range of nonprofit arts programs committed to accessibility, equity, and sustainability. Past recipients have included Heidi Duckler Dance Theatre in Los Angeles, the Media Arts Center San Diego, and Citizen Film production company in San Francisco.

Eligibility requirements:

• California nonprofit in good standing with the state
• Two years of consistent arts programming or services prior to applying

6. California Paid Family Leave Grant

Paid family leave (PFL) can be a big expense for small business owners. The California Paid Family Leave Grant offsets those costs, providing up to $2,000 per employee on PFL to help cover expenses like temporary staffing or lost productivity. The application process is very specific, so read the details carefully.

Eligibility requirements:

• California small business with 1 to 100 employees
• At least one employee on Paid Family Leave after June 1, 2024
• Active California Employer Account Number (CEAN)

7. SWRFBC Business Builder Award

The Southwest Regional Food Business Center (SWRFBC) Business Builder Award supports small agricultural businesses across California, Arizona, Nevada, and Utah. Between 2025 and 2027, $4.1 million will be distributed to small and mid-sized food producers, processors, and retailers to drive economic growth in the region.

Eligibility requirements:

• Small agricultural businesses, including producers, growers, processors, and distributors
• Annual sales under $1 million
• Operates in California, Arizona, Nevada, or Utah

8. Restaurants Care Resilience Fund

The Restaurants Care Resilience Fund provides $5,000 grants to independent restaurants in California to cover equipment, training, and unexpected hardships. Since 2021, over $7.3 million has been awarded to 1,603 restaurants across 38 California counties.

Eligibility requirements: 

• Independent restaurant or caterer with less than five locations
• Annual revenue under $3 million
• Utility customer of PG&E, SoCalGas, or SDG&E
• Open for at least one year

9. Restaurant Disaster Relief Fund

The Restaurant Disaster Relief Fund isn’t specific to California, but can be a good source of financial support for eligible small businesses affected by disasters. Created by DoorDash and Hello Alice, this fund provides $10,000 grants to restaurants. Grant funds can be used for expenses directly related to recovery from a disaster, including wildfire, earthquake, and flood relief grants—areas especially relevant to California small businesses.

Eligibility requirements:

• Brick-and-mortar restaurant with up to three locations
• 50 or fewer employees per location
• Annual revenue under $3 million per location
• Must have experienced a federally declared natural disaster

10. Founders First Pride Grant

The Founders First Pride Grant supports small businesses owned or operated by LGBTQIA+ entrepreneurs with $1,000 micro-grants to drive business growth. While it’s funded by a national association, it has close ties to California, partnering with organizations like the San Diego North Economic Development Council, the Golden Gate Business Association, and the Los Angeles LGBT Center.

Eligibility requirements:

• Business owner, CEO, or president identifies as LGBTQIA+
• U.S.-based small business active for at least one year
• Annual revenue under $5 million
• Minimum of 2 and maximum of 100 employees

How to apply for a small business grant

Breaking down the process for getting a California small business grant into clear steps makes it manageable. Use this step-by-step guide to navigate the grant application process and improve your chances of success.

• Research relevant grants. Start by researching grants that are relevant to California businesses in your industry or demographic. Use online databases, government websites, and small business resources to make a list.
• Make sure you qualify. Review each grant’s eligibility criteria in detail. Look for specific requirements like location, industry type, or size before applying.
• Gather any required documentation. Gather documents such as your business plan, financial statements, and proof of California business registration.
• Make it personal. Write a compelling narrative about your small business, including its mission, goals, and impact. Explain specifically how the grant money will help your small business grow and make a difference.
• Submit your application. Follow instructions carefully, double-check for accuracy, and submit early to avoid any last-minute issues.
• Follow up if necessary. If you don’t hear back after the timeline provided, politely reach out to the grant provider. Some organizations may even offer feedback to help you improve future applications.

Business grant vs. business loan: How are they different?

A small business grant is money you don’t have to repay, but it often comes with eligibility requirements and is awarded for specific purposes. In contrast, small business loans provide broader flexibility but must be repaid, usually with interest. Many California business owners use both grants and small business loans to meet their financial needs.

As you navigate funding options and other small business challenges, LegalZoom can help you with business formation, legal guidance, and advice on choosing the best funding sources for your goals.

FAQs

Does the California government give free money to start a business?

Yes, the state government, as well as local government agencies, offer many grants for California business owners, but they’re often tied to specific industries or goals. The California Grants Portal is a good place to start your search and application process. Don’t forget to also check out grant programs from federal agencies.

Is it hard to get a grant to start a small business in California?

The application process can be competitive, as small business grants typically have strict requirements and limited funding. However, with thorough research and a strong application, you have a good chance.

Are small business grants worth it?

Yes, grants can provide free funding to support small businesses without adding debt or requiring you to give up any equity. Even though the application process takes time, the benefits often outweigh the effort.

Is a small business grant taxable in California?

In most cases, small business grants are considered taxable income in California as well as federally. Small business owners should consult a tax professional to understand their obligations.