Advantages and Disadvantages of Grant Writing

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Advantages And Disadvantages Of Grant Writing


What are the pros and cons of grant writing?

Organizations and businesses interested in growing their businesses must constantly worry about funding their mission. Grants can be an attractive financing option because it provides an injection of capital that does not have to be repaid.

Grants create their own opportunity costs, including staff time to write, monitor, and report and to execute the program deliverables. They provide an opportunity to experiment and pilot programs, to brand or rebrand. 

Some of the advantages and disadvantages for grants are:


  • Provides financial investment when other sources of capital are unavailable to initiate or expand programs, products, or services
  • Unlike loans, they do not have to be repaid
  • They do not require the owners to surrender any equity in the business
  • If the funds are used as the granting agency intended, the business is in the clear
  • Enhances brand prestige, visibility, status, and credibility 
  • Provides a source of positive media coverage and marketing
  • Program success attracts further opportunities for funding
  • You can receive generous amounts of money


  •  Grants are competitive and the applicant pool is usually large
  • Organizations many need to spend money and other resources to apply for grants they are unlikely to win
  • Grants come with conditions that are worth considering before you apply. The donor expects you to meet the contractual terms and conditions. For example, a grant from a local source is usually designed to boost an area that needs economic regeneration will likely require you to set up office, hire local staff, regardless of whether that is the best for your business. You can’t do whatever you want with the funds.
  • Grants may be renewed yearly but may also dry up with little notice. An organization that relies on grants as a source of income can see its business model collapse quickly.
  • Most grants will not cover operating costs and an organization may need to match dollar for dollar amounts

Any grant application will ask four basic questions:

  • What is your business model and how will it make money?
  • Why is funding needed and how would you spend it?
  • How realistic are you? Do you really know your business?
  • Do you have the necessary documentation needed in order to be ‘grant ready’?

The questions may be framed differently, but the result is the same.  The final way to get a grant is that in your application process you must convince the funder that they will see a positive outcome and a return on their investment. It is important to focus on the needs of the potential funder and make sure you understand what they are trying to achieve to determine a match.


The bigger picture

  • One of the biggest missteps in grant writing is failure to plan for and budget the time necessary to submit a successful application
  • The more grants you write the more experience you will have
  • Grant agencies will provide feedback that can be a valuable learning opportunity
  • The more grants you write, the more you will increase your chances of securing one
  • Every organization needs to develop grant writing and reporting skills or they will have to invest in a grant writer who will work on a commission basis
  • It is advisable to pilot a program to demonstrate that you are willing to invest in yourself before you try to convince another organization to invest in you