What is a Grant Proposal?

Are you interested in starting your own business and daunted by the prospect of what challenges you may face writing a grant proposal to get funds to start your business? We’re here to let you know help is here! It’s not as challenging as you may have thought it to be.

A lot of individuals may think that grant proposals are these huge, complex, multi-page documents as a grant proposal. However, in actual fact,, there are indeed several types of grant proposals. AfricanAmericanGrants.org has compiled a number of these grants to help you understanding what grants would fit your business plans in 2021.

One way to start to look at grant proposals is starting with the right knowledge. Authors Carlson and O’Neal-McElrath have come up with a book — Winning Grants Step by Step on Amazon, this helpful book goes indepth in explaining the three types of grant proposals. The book Winning Grants Step by Step goes on to explain these three types of grants to help give details that anyone looking to apply for grants would find very valuable.

We have taken out time to explain each grant proposal to help you understand the different areas of  grant proposals that focus on different aspects of the grant application. The type of grant proposal that you select all depend on what grants you are after, and what you plan to do with the grants if awarded.

Three Types of Grant Proposals

We have outlined the grants that you may have to choose to be able to have a successful grant application. The three grant proposals are required for severl reasons. The list makes it easy to understand what grant is suitable for what grant application and how to go about applying using the grant proposals listed.

The Letter of Inquiry grant proposal (LOI)

The first one on our list is the Letter of Inquiry this is the ideal grant proposal that usually goes to a foundation. It is, essentially a way to pique funders interest in your project. You may also decide to send this LOI to several of the grant-issuing agencies and foundations to see if your project fits any of the grant plans that you may have.

An LOI runs to only two or three pages that summarize your project. It gives a taste of what you are planning. With the LOI, you and the funder explore whether or not your idea is of interest. If it is, you will move on to the full proposal.

Many foundations now prefer to receive an LOI as the first step toward funding. They can quickly assess whether your project is a good fit for them. If it isn’t, they and you can move on.

Your nonprofit might initiate the letter to test the waters for your idea. Or a funder, usually the grant-issuing individuals or agencies may ask for it. These grant-issuers may typically include their grant criteria preferences for a grant letter or a grant proposal in their grant criteria eligibility. Those guidelines can be found on the grant-issuing individual or agency’s website or grant documents. In other cases, they may be found in the Request for Proposals documents sent out to those interested in applying for a given grant to which you might have indicated interest for.

In any case, when it comes to IOL, you will still want to take your time to explain the need for the grant, and make sure you craft a good grant application, have a DUNS number, outline the plan to meet it, and specify in details how the grant would be a match for what the grant-issuing agencies have in mind, especially as meeting their grant specifications.

Full Grant Proposal 

A full grant proposal is what we usually have in mind when it comes to the idea of grant proposals.

A full grant proposal follows a fairly similar format like the LOI. This is part of the process that the format includes in terms of all of the details that are included in the funding-agencies plan of grant programs. Many of these full grant proposals can be quite lengthy and very detailed, with some ranging from from five-25 pages or more in some cases.

It is important to make sure that sure that you adhere to the funders’ instructions when it’s time with the grant programs. The step by step direction of how you can apply for grant is something that you can see in the full grant proposal letter.

It is important to know that there are cases when some exceptions and other special considerations for online applications may apply. This is something that you can see the trend in grant applications in 2021. So make sure you get all of the necessary details to help you get the grants that you seek when it comes to funding your business.

Letter Proposal 

The letter proposal corporations may want you to produce a letter proposal instead of the usual 25-page than a long, formal proposal that are quite common when it comes to business funding.

If you happen to have a sole proprietorship, a business partnership and need funding, then the grant proposal will guide you to finding the grants you need to help you get setup for the right funding. In any case, make sure that you have all the necessary documentation that can help you set things right when it comes to grant proposals.


Applying for grants require a number of important steps that you have to take to make your grant dream a reality. What you have to remember is that you have access to these grants just by looking at our grant resources. This process is part of the program that helps to explain the different aspects of grant applications that individuals and agencies have to abide by to make their grant applications successful.

Grant proposals are just one of the many documents you may need when applying for grants. Not everyone understands what goes into crafting a highly successful grant proposal. If you need help with writing the perfect grant proposal that will help get grants for your business, we can help! Click here to connect with one of our grant specialists to help you get started with the process of writing a grant proposal for grant awards.