The Grendel is a short, compact SMG that seems like a mix between a P90 and AUG. It shoots 7.77mm bullets without cases and has a magazine with 50 bullets. Combatech makes it, and they call it a lightweight personal defense weapon, or PDW. It shoots fast and works well in the middle-distance fight. This is good in places with lots of stuff, where it's easier to aim at enemies behind cover.
For the Grendel location, you can find the weapon in the Deadrock Mining Outpost on the planet New Atlantis as a reward for completing the Abyssal Terror quest. The quest is available after you reach the New Atlantis planet and speak to Darvin, the owner of the Darvin's Supply store.
The best background for the Grendel in Starfield depends on your playstyle and the mods you want to use. However, some backgrounds that are well-suited for the Grendel include:
You can find parts for the Grendel by scavenging on planets and in space stations and by buying parts for the Grendel from merchants on planets and in space stations.
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