Smith School Awarded $1M Federal Grant to Help Small Businesses Adopt AI

The Center for Artificial Intelligence in Business at the University of Maryland’s Robert H. Smith School of Business has received $1.031 million in federal funds to help small businesses adopt AI solutions to improve efficiencies. The grant was championed by U.S. Rep. Glenn Ivey (D-Md.), who presented the funds at an event in College Park on Tuesday.

The Smith School, with support from the Maryland Small Business Development Center (SBDC), will use the money to analyze existing AI solutions, develop new programs, and provide online courses and workshops for small businesses across the state. Smith students will be involved in all phases of the initiative. 

The efforts will be led by Professor Balaji Padmanabhan, director of the Center for AI in Business and associate dean of strategic initiatives, and Tejwansh Anand, clinical professor and academic director of the M.S. in Information Systems & AI program.

“A lot of small business owners don’t know where to start when it comes to AI,” said Padmanabhan. “But to survive and thrive, they have to be scrappy, they have to be innovative, and they have to be resilient. And AI can help with all of that. Small businesses drive over 40% of the GDP in the U.S. economy, so the opportunity here for AI is significant.”

The Smith School’s work with small businesses and AI began two years ago, when Padmanabhan and Anand worked with Prince George’s County Economic Development Corp. to run workshops to teach small businesses to use AI. The Center for AI in Business developed a custom online program and in-person workshop for more than 50 small businesses in the county. This new federal funding will allow the Smith School to expand that program to small businesses throughout the state of Maryland. 

The Maryland SBDC, housed at the university, will co-sponsor the online courses and help develop the curriculum and market the workshops to small businesses statewide.

“We’re going to help small businesses identify pain points and select suitable AI tools and pilot them in a low-risk, measurable way,” said Lora Brown, executive director of the Maryland SBDC.

The initiative will include case competitions, where students will come up with AI solutions for small business problems. Smith will work with the SBDC to identify Maryland-based small businesses for the competition case studies.

The Smith School will also use the funds to build a one-stop-shop online portal, where small business owners can find the best AI solutions for their organizations. Some practical ways small businesses could use the technology include AI-powered customer service chat and email responses, image and document scanning, AI for receipt and invoice processing, and AI for monitoring of competitors and market signals to improve business. University of Maryland students will help build this platform.

“We all need to understand these new, transformative technologies if we are going to maintain our economic prosperity in the state of Maryland in the 21st century,” said UMD President Darryll J. Pines. “But we will only be competitive if we work together just like this.”

Padmanahban said the funding will also support research to shed light on the challenges small businesses face in the AI space, as well as how AI can help.

“My own belief is that the biggest productivity growth for our economy in the next few years is going to come from the impact of AI on small businesses,” said Padmanahban. “The potential there is tremendous, but this group needs help to reduce the friction, to make it easier for them to access AI and build it into their daily lives.”

“It’s an honor to be able to do this and help you all accomplish this mission,” said Ivey, who presented an oversized check to Padmanabhan, Pines, Brown and Smith School Dean Prabhudev Konana.   

The AI for small business initiative is the latest expansion of the Smith School’s commitment to help businesses at all levels understand and implement AI. The school launched the Center for AI in Business in 2024 and has a vast base of faculty expertise in artificial intelligence. The center’s successful collaboration with Prince George’s County on the AI initiative for small business was the first such program in the country. 

In May 2025, the Smith School launched a free online Certificate in Artificial Intelligence and Career Empowerment program to help federal workers and others build AI literacy and support career transitions. More than 50,000 learners worldwide enrolled in the 10-module, self-paced program, the first of its kind in the country.