Frankston City Council recently announced a new grant scheme for start-ups, one of the few local councils around the country to offer grants to early stage ventures.
The Victoria-based council is offering a suite of three grants, one of which is aimed squarely at start-ups (applications are open until November 12).
While such grants are rare, Frankston is not unique. So which councils are doling out cash to start-ups, how does the process work and how can you increase your chances of being a recipient?
In Frankston’s case, the grants are part of the council’s economic resilience program. Successful applications will receive up to $10,000 in grant funding. The council will look to offer fewer than 10 grants in this first round.
Frankston City Council’s Jonathan Reichwald, whose title is ‘city centre place maker’, says the scheme aims to increase local employment opportunities, to help revive the city.
“The program has six objectives,” he says.
“These include employment creation, to build a resilient economy through sustainable and diverse industries, to improve commercial occupancy rates, to develop a creative hub, to reactivate the commercial precinct and to shift perceptions about Frankston.”
What this means is that successful grant applicants need to demonstrate how their business will help Frankston achieve these objectives.
For instance, to meet the sustainability objective, successful applications might demonstrate they have a certain amount of negotiating power with suppliers and customers, or be able to withstand the threat of new entrants into their market.
“If a business just has one customer, or if suppliers can dictate terms, this doesn’t offer business sustainability,” Reichwald explains.
Aside from the grant, successful applicants will receive a $3,000 marketing package, including a one-month campaign in the local newspaper, a YouTube video and membership to a local business association.
“The grant is not a cash handout – it’s a reimbursement model. Recipients have to provide invoices for business growth ventures, so funds can’t be used for day-to-day expenses, they must be used for things like business development, web site development, marketing or to purchase specialist equipment,” Reichwald says.
Frankston is not the only council to offer grants for start-ups. Its start-up grant funding model is based on a similar program developed by the City of Melbourne.
Reichwald says the application process for one of Frankston’s grants is much easier than the City of Melbourne’s.
“We’ve made the application process 60% easier. But we require all successful grant applications to sign a commercial lease,” he says.
The City of Melbourne’s program has been running since 1996. Applications for its next round of funding grants for start-ups will be open between February 2013 and March 2013, with grants starting from July 2013.
The council offers grants of up to $30,000 for start-ups. Similar to Frankston’s grants, Melbourne’s grants aim to ‘increase the diversity of the city’s business community’.
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Alexandra Cain is a freelance finance journalist and editor who writes for a range of local and global publications, including The Australian Financial Review, The Sydney Morning Herald, The Age, the Australian Securities Exchange’s publication Listed@ASX and Investor Relations Magazine. Ali writes for leading international and Australian financial institutions and businesses and is an experienced conference and webinar speaker and host. She lives, works and surfs in sunny Sydney.
