Tips For Winning The Battle For Institutional Funding
For many nonprofit leaders, the most time consuming and frustrating part of the job is securing funds to do what it is the organization has set out to do. Fundraising can be time consuming and every nonprofit has probably battled with where to look and how to approach funders.
| Posted in Fundraising on Aug 20, 2012 by
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After years of advising nonprofits, and running one myself, I have created a short list of types of institutional funders and considerations involved when asking for funds.
Types of Funding Given
If your organization has an excellent new idea, or a successful program that is ready to expand its impact, reaching out to a foundation for funding may be a good fit. Foundations will often provide seed grants, start-up funding, program support, operational support, and funds for capacity building.
Foundations normally have a cyclical funding cycle with specific application deadlines. When researching foundations it may be wise to develop a calendar to keep track of important dates.
Typically funds are given based on relationships and foundation interaction. A foundation wants to know its money is being used to fulfill the foundations mission and they are often very detailed and formal in their application process. However, once a relationship is secured and it continues to meet the proposed outcomes and timelines, a long term funding relationship can be developed with a foundation. The downside of foundation funding is the competitive nature for the funds. Additionally, foundations often have a multi-phased application process that can take a lot of time and work. As a result, the process can be very complex and often political.
When considering approaching a foundation for funding ensure that the foundation’s focus aligns with your organization. Are there geographic restrictions? What types of programs and services will they and won’t they fund? Above all, remember persistence pays off – applying and following up on unsuccessful applications can help you understand how to fine tune future applications.
Funding from corporations can vary, and it is wise to invest a little time thinking through why a corporation would want to give your organization money. Support from corporations include grants, in-kind support, employee campaigns, matching gifts, volunteer involvement, and cause marketing.
Similar to foundations, corporate giving is often on a particular funding cycle and requires research and preparation in order to meet deadlines. Typically, giving is based on either established relationships or upon a very formal application process. Corporations already tend to know what type of “cause” they want to support. Make sure that before you spend time working on a proposal for corporate funding you know the corporate approach to giving.
There are several different ways to approach a corporation for support. The first is relationship driven. Do you have a relationship or connection with the CEO or someone within the corporation? This is always a great place to start. If the CEO believes in your nonprofit than her corporate support may be just a phone call and presentation away.
Another angle, what does your organization have to offer a particular corporation? Is the company looking for brand awareness and exposure? Are you working in a particular community or for a particular cause that is linked to a corporation’s focus? This may be a great way to find funding for your upcoming big event or community program that needs products, sponsorships, or even funds. (Remember to think about the ultimate goal of what the funds are needed for – perhaps a corporation would rather donate computers for an after-school program than give funds for the computers. Think of creative opportunities for corporate giving – it doesn’t just have to be financially.)
Corporate Social Responsibility (CSR) has become a way that larger corporations can give back in a very purposeful way. While it is a more complex application process to garner funds, companies with CSR initiatives are very purposeful in their giving and longer term funding is attainable. Based upon your organization focus, look for companies with a CSR that is similarly aligned.
There are two very important considerations to remember when choosing a company to approach. Firstly, remember your values. Based upon your organization’s mission, choose companies that align with your values and that you are comfortable being associated with. And secondly, funding is often tied to company performance. If the company hits a financial slump funding for non-profit support may run short.
Civic organizations such as faith-based institutions and community-based organizations can be a great resource for local and regional support. These types of institutions can offer your organization more than just financial support but operational support, program support, in-kind donations, event sponsorships, and can even provide access to members as prospective donors.
Civic organizations are often cyclical in their funding cycle, however once secured they can provide support on an on-going or annual basis. Additionally, being that civic organizations are either geographically linked to an area or linked to a particular cause, developing and maintaining relationships are very important in securing support.
It cannot be overstated that in any fundraising approach relationships drive opportunity, particularly within civic organizations. It is here where a nonprofit can find a wealth of committed volunteers, opportunity to disseminate information throughout a community, access to facilities for programs/events, and connections into established networks. Also, similarly to corporate affiliation, it is important to remember that civic organizations should be thoroughly researched and considered before approaching for funds, ie: will an association with a particular civic organization align with your organizational values and mission? This consideration may require that you and the civic organization sign a memo of understanding based upon particular values and issues.
Many non-profits can be overwhelmed by the thought of applying for government grants. It can be a tedious process. However, if done correctly, government funding can be what takes a small nonprofit’s great idea or program into a wide reaching nationwide success. Government funding can also come contracts, sub-contracts, and fee-for-service.
Typically grant funding happens on a cyclical fiscal year basis. The process is very formal and competitive and ongoing funding is normally contingent on an annual review process.
Preparation for government-funded applications requires that your organization be extremely well organized in both program and financial structure. The grant-writing process does take work – but is even helpful in establishing strong documentation on your organization and evidence-based programs. Being prepared to administer and manage the grant is important. A small organization receiving a very large grant must be able to show that it can be responsible with the funds through outcomes documentation and regular reporting. One of the most important aspects of receiving government funding is being able to track progress/success through deliverables that are met based upon a pre-determined timeframe.
Fundraising Request Requirements:
The following are key items that should be considered in any funding request:
- What do you want: What is the need for the project or organization that you are requesting?
- Quality of the program: Give the statistics, the stories and successes – why would a funder want to give money to this program. Highlight the quality of the program and the reasons why it deserves being funded.
- Program management: How is the program currently being managed? How will it be managed in the future?
- Organizational and Performance History: Foundations want to know your history and what you’ve done since you’ve been in existence. Provide a comprehensive performance history that highlights the successes and obstacles your organization has overcome.
- Organizational Capacity: Do you have the capacity to take this program or your organization to the next level? Show off your human, financial and other resources that make the program work and will ensure it succeeds.
- Community/Client Support: Does your community or the constituencies that you serve know about you? What are they saying? Highlight testimonials and showcase the support you have from your community.
- Strong financial systems: Every funder wants to see that they are giving to a healthy nonprofit. No matter the size of your organization, ensure that your financial systems are in good order.
- Client tracking systems: How do you measure success? A client tracking system or monitoring framework should be developed in order to show “success” within your organization.
- Goals, Objectives and Outcomes: Every funder wants to know their money is being put to good use. In your proposal specific goals, objectives and outcomes need to be developed in order to measure the future successes you will have by using their financial support.
- Timely Reporting process: If you have a client tracking system and outcomes in place it should be easy to keep to a timely reporting schedule. Make sure you clearly state reporting timelines in your funding request.
- Sustainability: What happens when the funding is finished? Will you be able to carry on with the program/project? Funders want to show they are able to make in impact but need to know that you will be sustainable after they have given.
For additional help with any of these areas, check out the following resources or feel free to give me a call.
Article: How to get Foundation Money
Article: Show Me the Money – Getting CSR Funds for Your NGO
Article: How Non-Profits Get Really Big
Article: Finding Government Grants
Fundraising Grants Start-up Funding Event Sponsorship Applegate Consulting Donor Development Nonprofit
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