Minnesota Promise Act Grant: $86.48M Funding For Small Businesses

Grant Overview

Up to $50,000 in Financial Support for Minnesota Businesses Impacted by Structural Challenges

Donor: Minnesota Department of Employment and Economic Development (DEED)

About: The Minnesota Promise Act Grant Program represents a substantial commitment to supporting underserved businesses across the state. With a total allocation of $86.48 million, this initiative aims to revitalize communities that have experienced structural challenges, including racial discrimination, civil unrest, population decline, and limited economic diversification.

Established through the Providing Resources & Opportunity & Maximizing Investments in Striving Entrepreneurs (PROMISE) Act, this grant program was approved by the Minnesota State Legislature and signed into law by Governor Tim Walz as a direct response to addressing systemic inequities in the business landscape. The program’s structure leverages partnerships with regional organizations throughout Minnesota to ensure that funds reach businesses in communities with the greatest need.

What distinguishes the Promise Act Grant is its tiered funding approach, which provides proportional support based on your business size. Small businesses with annual revenues under $100,000 can receive up to $10,000, while those with revenues between $100,000-$350,000 qualify for up to $25,000. Larger small businesses with revenues between $350,000-$750,000 can access the maximum grant amount of $50,000. This scaled structure ensures that businesses receive appropriate financial support relative to their operational size.

The grant funds are specifically designated for working capital expenses—including payroll, rent or mortgage payments, utilities, equipment purchases, and similar operational costs. This practical focus ensures that businesses can address their most pressing financial needs during challenging economic periods. Unlike loans, these grants don’t require repayment, offering genuine relief to qualifying businesses.

Application periods vary by region, with each of the seven partner organizations managing their own application timeline and process. These partners include Neighborhood Development Center (Metro), Northland Foundation (Northeast), Northwest Minnesota Foundation, Initiative Foundation (Central), West Central Initiative Foundation, Southern Minnesota Initiative Foundation, and Southwest Minnesota Initiative Foundation. Each organization serves specific counties and, in some cases, Native Nations within their designated regions.

The eligibility requirements are designed to target established businesses that have demonstrated resilience despite challenging circumstances. Businesses must have been operational since at least 2021 (with 2021 tax documentation as proof), have gross annual revenue under $750,000, maintain operations in Minnesota communities affected by structural challenges, and be properly registered with the Minnesota Secretary of State if required by law.

Navigating grant applications can be overwhelming, especially while running a business. At Grantaura, our team of grant experts can help you determine your eligibility, prepare a compelling application, and increase your chances of securing PROMISE Act funding. Our comprehensive grant services include specialized research to identify additional funding opportunities, preparation of required financial documentation, development of business plans, and complete application submission assistance. With our 4.9/5 rating from over 180 clients and 300+ successful projects, we specialize in helping small businesses access the capital they need to thrive.

Focus: Small business support, working capital, payroll expenses, rent assistance, mortgage payments, utility bills, equipment purchases, operational expenses, minority-owned businesses, business recovery, economic development, community revitalization

Region: Minnesota, United States

Eligibility:
-Business must have been established in 2021 or earlier (verifiable through 2021 tax filing)
-Primary business operations must be located in Minnesota
-Business must be located in a community affected by structural racial discrimination, civil unrest, population loss, aging population, or lack of regional economic diversification
-Must be registered with the Minnesota Secretary of State if required by Minnesota State Law
–Sole proprietors operating under their own name are exempt from this registration requirement
-Annual gross revenue must not exceed $750,000 (based on 2021 taxes and most recent completed tax year)
-Must maintain ongoing operations as of application date
-Business types eligible include:
–For-profit businesses with revenue under $750,000
–Nonprofit organizations that earn at least 30% of revenue through non-tax-deductible sales or dues in a fee-for-service model similar to for-profit businesses
–Nonprofit organizations that earn at least 10% of revenue through non-tax-deductible sales or dues AND maintain customer-facing operations at a permanent physical location where sales occur
-Applicants must not have been convicted of criminal offenses related to state grant agreements

Benefits:
-Grants of up to $10,000 for businesses with gross annual revenue of $100,000 or less
-Grants of up to $25,000 for businesses with gross annual revenue between $100,001 and $350,000
-Grants of up to $50,000 for businesses with gross annual revenue between $350,001 and $750,000
-Technical assistance available for application submission
-No repayment required (grant, not loan)
-Funds can be used for essential business expenses including payroll, rent, mortgage, utilities, and equipment

Deadline: Application periods vary by partner organization

Terms:
-PROMISE Act: Providing Resources & Opportunity & Maximizing Investments in Striving Entrepreneurs Act, legislation approved by the Minnesota State Legislature to fund grants for businesses in communities facing structural challenges
-DEED: Minnesota Department of Employment and Economic Development, the state agency responsible for economic growth, workforce development, and administering the Promise Act Grant Program
-Working Capital: Money used to cover a company’s short-term operational needs, such as payroll, rent, and utilities
-Gross Annual Revenue: Total income generated by a business before any deductions or expenses are subtracted
-Prior Year: For grant purposes, defined as the most recent completed tax year at the time of application
-Fee-for-Service Model: A payment structure where services are unbundled and paid for separately, used to determine nonprofit eligibility for this grant