As fundraisers, we know that while individual giving dominates, finding the right foundation, corporate, or government grant can give your budget a real boost. Many of these funding sources make large, multiyear commitments, and for some nonprofits, these sources of funding are their only sources of funding.
And while unlocking these sources of funding can rain down large sums of money, they can also create a lot of wasted time and rejection letters. What follows is a set of tactics you can use to increase the probability of securing funds from these sources and to do it in a manner that is worth your time and effort.
First, weigh the costs!
Securing funding from any source is typically a welcomed gift. However, many nonprofits are short on resources and the staggering amount of time they spend to secure and maintain grants can greatly reduce the time they spend on raising money from individuals, which in some cases, can mean a loss of income.
A grant application may take dozens of hours to complete. Waiting for approval may take months. Waiting for a check may take many more months. When the check arrives, the amount funded may be much less than expected and the reporting requirements may require more work than expected. Plus, many organizations have limits on how much they can give you based on your budget size.
On the other hand, some grants are headache-free and easy to get. The application process may be nothing more than a two-page online questionnaire, the approval process is fast, checks arrive quickly, and the reporting process is minimal.
So are grants (and sponsorships) worth the time and effort? Maybe. As a savvy fundraiser, it’s your job to assess the costs and benefits of each opportunity. Ask questions: Is this funding opportunity worth the time and resources we’re going to have to put forth? Or, would it be better to spend the same amount of time and resources on cultivating donors, hosting specialty events, and raising money in face-to-face settings?
Is it better to secure a grant that might last only two years, or secure more donors who might become loyal givers for five, 10, or 20 years? How can we invest our capacity in a way that will provide the best long-term results? There’s a healthy balance and it’s your responsibility to adjust the scales based on resources, expertise, and funding goals.
Corporate giving
Types of corporate gifts
- Sponsorships. Corporations and businesses of all sizes like sponsorships because they’re great PR and allow them to show people how much they care about their communities. They give money and in-kind services, and in return get their name prominently displayed at events, in marketing material, and in the media. They might also get a few perks such as free tickets, VIP access, and drink coupons.
- In-kind gifts. More and more companies are willing to support nonprofits by getting their staff involved as volunteers rather than writing checks. This is a bonus to nonprofits because more volunteers mean more human capital and the possibility of more donors. Plus, if a company’s staff has a great experience volunteering with you, it increases the likelihood that the company (and the volunteers) will make a cash donation.
Many in-kind corporate contributions can provide significant value to nonprofits. Accounting firms can provide bookkeeping and accounting services, law offices can provide legal advice, and marketing companies can provide graphic design services. However, companies don’t know how they can help unless you call on them. Pick up the phone, express your needs, and find ways to get the company’s staff involved.
- Cash and grants. Most companies, regardless of size, have charitable giving budgets. When seeking cash donations, local and regional businesses are your best targets because they tend to support local nonprofits whose services benefit the community.
Don’t expect large companies to make large gifts. Donation sizes can vary. Some Fortune 500 companies make small grants that require detailed applications and reporting, while some small businesses make large gifts that require no application or reporting. Determine if the size of the gift is worth the effort to secure it.
- Employee matching. Matching gift programs are charitable giving programs set up by a company in which the company matches donations made to a nonprofit by its employees. Companies typically match on a 1:1 basis, but sometimes they match at ratios of 2:1 or 3:1.
Matching gift programs can be very effective, especially after you’ve engaged a set of employees as volunteers. If they have a meaningful volunteer experience, they may be willing to “champion” the matching gift program to coworkers who did not volunteer.
- Cause marketing. There are many variations of this type of giving program, but the most common type is when a company commits to giving a percentage of its sales of certain products or services to a selected nonprofit.
The problem? The amount of money received is typically small unless you have an agreement with a large company willing to give you a large percentage of sales proceeds. Before you agree to a cause marketing deal, conduct a detailed cost-benefit analysis to determine if it’s worth the time and resources you’ll have to put into it.
Tactics to win corporate gifts
- Do your homework first. Before you send a proposal, find out some information about the company’s philanthropic profile. What issues are important to them? Is there a good fit between what you do and what they fund? What types of nonprofits have they funded? Do they prefer sponsorships or grants? What size gifts do they make? Do they have an employee volunteer program? Do they have an employee donation-matching program?
- Target local companies first. Target local companies first because they like to support local nonprofits. After that, you can expand your reach by geographic regions. One of the biggest advantages of working with local businesses is that the owners are typically more accessible, more involved, more flexible, cut checks more quickly, and require less paperwork.
- Get a meeting with a decision maker. Climbing your way up the corporate decision-making ladder can be exhausting. Find out who the decision makers are and talk with your team and board members to find out how they can help you set up a meeting. If you get a meeting, try to hold it at a location where your programming is taking place to increase your chances of getting a “Yes” to your ask.
- Help improve a company’s image in the community. Corporate philanthropy and corporate image go hand in hand. It’s critical you show companies how you plan to recognize them and their gifts. Show them how you plan to highlight them in social media, on your website, on television and radio, at an event, and in promotional material. You may even be able to demonstrate how their involvement will improve staff morale and increase sales.
- Show impact. Companies are keenly aware of ROI (return on investment). If you want to win corporate funds, show them the success of your work in terms of ROSI (return on social investment). Show them the impact their gifts will have on your beneficiaries, the community, employees, customers, the issues you’re addressing, and their community image and corporate objectives.
- Target the marketing department. Most corporate sponsorships are funded through a company’s marketing department. This typically means less hassle and faster turnaround times. Therefore, if you’re looking for a large company to underwrite the catering expenses of your gala, call the marketing department, not their foundation.
- Start with volunteers. If you want to get companies to fund your mission, get their employees involved first. Offer non-programming opportunities as well as programming opportunities. Ask for in-kind gifts such as Web design work, strategic planning guidance, investment oversight, and brand management.
- If you’re hosting a programming event or fundraising event, get corporate teams to pitch in. As more volunteers have meaningful moments with your nonprofit, more executives will notice, which will lead to greater opportunities for funding. You may also want to ask a volunteer or an executive to join your advisory board.
Foundation giving
Tactics to win foundation grants
- Do your homework first. Learn about a foundation’s philanthropic profile before submitting a grant. What issues are important to them? What types of nonprofits have they funded? Is there a good fit between what you do and what they fund? What are their giving guidelines? What are their reporting requirements? What size gifts do they make? Is the grant amount worth the time and effort you’ll need to put forth to secure it.
- Start small. Small, local foundations are good targets because they like to fund nonprofits that are making a difference in the communities in which they operate. Applications can be as short as one page and reporting requirements are typically nominal.
- After securing a handful of local grants, move on to regional and national foundations. They will be more open to funding you once they see you have the ability to secure local grants from small and medium-sized foundations.
- Show impact. Foundations are all about performance and impact. You must demonstrate how the work you’re doing is making a meaningful impact on the people you serve, the community, society, the environment, the issue you’re addressing, or whatever. This impact needs to be clear and it needs to be measurable, and you should present it in a powerful and compelling manner. Keep in mind, it’s more impressive to show how deep you are than how big you are, or how fast you’re growing.
- Meet with them. Foundations don’t make decisions, people do. If you can arrange a visit at a foundation to meet a grants manager or a trustee, make it happen. Better yet, set up a visit so they can meet your team, see your facility, and observe your programming. Once you get funded, it’s important to nurture your relationships with grants managers and trustees because if they like you, and your nonprofit is making a big-time impact, you’ll find yourself in good favor to secure future grants.
- Write a standout grant. Many foundations see hundreds, sometimes thousands, of grant applications a year. Most nonprofits write shoddy grants. To get funded consistently, your grants need to be professional grade, not “Let’s just get it done” grade. This is one of the biggest mistakes nonprofits make when writing grants. Poorly written grants find their way to the trash. Grants applications that stir the emotions of grant managers get funded. Grant writing is an art. Be cautious about using interns and inexperienced grant writers. You don’t want to lose out on precious grant funding due to careless and substandard writing skills.
- Follow grant guidelines carefully. The writing should be typo free and grammatically correct. The layout and design should be clean and sharp. The content should be concise and compelling. The graphics must pop. If you spend the time to write a few standout grants, you can leverage the hard work because a lot of the information is transferable to other grant applications.
- Ask for modest funding first. A surefire way to have your grant tossed in the trash is to ask for an exceptionally large first-time grant, say $100,000, when a foundation’s first-time grants range between $10,000 and $20,000.
For a first-time grant, it’s wise to exhibit modesty and ask for an amount at the middle or lower end of a foundation’s first-time grant range. It’s more important to get funded than to ask big and risk not being funded. Why? Because once you get funded and you prove your worth, you’ll have opportunities to ask for much larger amounts of money.
Government giving
Tactics to win government grants
- Community support. Government agencies are leery of funding new and unproven nonprofits. If you can show your programs and organization have widespread community support, agencies will look at you more favorably.
- Start locally. When you first apply for government funding, try to secure a small grant from a local or regional agency. If you’re successful at this level, federal grants will be easier to secure. Plus, you’ll learn a lot about how the government grant-making process works. This is an important strategy because it’s better to make mistakes on small grants than to lose a large grant due to inexperience.
- History of successful performance and impact. Government agencies are big on track records. They want to see three to five years of consistent high-performance and specific outcomes and impact. You want to show agencies as many measurable results as possible because the more you have, and the more persuasive they are, the better your chances of getting funded.
- Best practices. The government is a big fan of best practices. They tend to be cautious about “new” and “different” but embrace “innovative” and “improvement.” Whenever you can, show that you are following, plan to follow, or plan to create industry best practices.
- Evaluation plan. If you want to impress government agencies, show them you have an evaluation process in place for your programs and operations. Your evaluation methodologies don’t have to be complicated, just thorough enough to show that you’re concerned about efficiency, effectiveness, performance, and accountability.
- Model organization. Government agencies like to support model programs. If you can show that your programs, services, or methods of operation can be a model for other nonprofits, a sector, or for an issue, agencies will look at you favorably. If what you do can also be easily scaled, leveraged, or replicated, that’s even better.
Summary
While individual donors provide the bulk of charitable giving, foundation, corporate, and government support can deliver the financial boost nonprofits need to strengthen their budgets and expand their reach. But regardless of the funding mix you choose, it’s important to consider the ROI of the mix because fundraising departments are always in short supply of resources.
In the end, securing these funds may sometimes feel like “just paperwork,” but with the right approach, and the right tactics, it can also provide a steady flow of diversified funding that can help your nonprofit grow and sustain itself, and propel your mission.
The post The other 20%: Winning foundation, corporate, and government dollars appeared first on Bloomerang.
