Prospecting: Step One to Stronger Grant Submissions

The lure of grantsmanship is the intoxicating concept that your nonprofit can secure outsized investment by simply applying for it. Too many think of it like submitting a credit card application; based solely on the merits of your organization’s mission and impact, the grantmaking source will prioritize your project and reward it with a big check with many zeroes.

The fact is, this isn’t how it works. Grantmaking sources receive hundreds, if not thousands of submissions every year. The movement toward online submission processes has made it relatively easy for 501c3 organizations to submit applications and grantmakers are deluged with requests, many of which do not match giving guidelines. The likelihood that your proposal is carefully reviewed is relatively low given the number of applications that must be processed.

So what does this mean? Should you give up on the hope for grant funding? Of course not. But it does mean that you should do your homework and focus your energy on sources that are more likely to fund you. In Next Stage Consulting’s first installment in its five-part series, I’ll talk about prospecting for grantmaking sources.

Identifying Sources
It is an oft-asked question – “isn’t there a website where one can seek grant opportunities?”

The answer is “yes and no.” There are certainly websites, but they are rarely free. Some of the best sources are The Foundation Center and FoundationSearch, both of which offer access to searchable foundation profiles for a fee. My personal favorite is FoundationSearch, which is run by Metasoft, a Canadian company that operates as a for-profit business. The Foundation Center has a very good product as well, Foundation Directory Online, but I’ve found Metasoft does a good job of staying one step ahead of the competition.

In some communities, you may find that your local library provides access to foundation software. For example, the Charlotte Mecklenburg Library provides access to The Foundation Center at its Main Library branch and six satellite branches.

These are fairly comprehensive resources, but you might find that not all corporate sources of support are profiled. Some companies may have a community relations team that provides gifts and sponsorships, but do not operate under a 501c3. Still other foundations operate under the umbrella of your local community foundation, and do not report directly to the IRS.

To identify these and other sources, search engines like Google can be the best bet. Search for queries using your mission focus, geographic region and words like “gift,” “grant,” “allocation” and “award.” You may also want to look at the websites of organization similar to yours and seek out online annual reports that might give you an idea of sources you have not yet uncovered. If you are familiar with the IRS form 990, set up a free login with Guidestar.

Types of Sources
Grantmakers are likely to fall into one of three categories:

  • Corporate Foundations/Corporate Outreach – Some companies develop a separate 501c3 foundation to operate as a channel for grant making. These are typically large companies that want to separate gift making from sponsorships, where they are likely to receive sponsor recognition in return. Most companies do not have a foundation, though they may also allocate gifts to support causes. Corporate foundations will often have a designated contact along with a board of directors. Companies without a foundation will designate a Director of Corporate Communications, External Relations, or Corporate Outreach to be the initial contact. In both cases, internal contacts at high levels of the company have the ability to introduce projects for support, and overlap with sponsorship efforts are common.
  • Process Foundations – Foundations where the founder is no longer the sole decision maker are more likely to operate with a very defined process. A gatekeeper is apt to be defined (either an Executive Director or Foundation Director), and the foundation’s board of directors are each involved in determining which organizations receive support. These foundations are attractive because they seem to be cut-and-dry regarding the application process. However, many factors contribute to whether your organization will receive support, and relationships are key to success.
  • Family Foundations – Though they are formed as 501c3 entities, soliciting family foundations is often akin to soliciting an individual – there is typically no defined process for applying for support, and the decision is made by a single or handful of individuals who are related. Relationships are the single most important factor to receiving support, either through direct interaction with foundation directors or gatekeepers connected to decision makers.

Determining Likelihood of Support
Like most forms of fundraising, successful grant seeking typically boils down to three motivations:

  • Mission-Suitability – This seems obvious, but grant makers usually tell you what they want to support. This information can be found online, but you might have to look of the foundation’s Form 990 to figure out where they tend to allocate funding. However, not all missions are created equal. Knowing that a foundation supports education programming is useful, but it is also important to figure out whether there is a preference for direct service or systemic change, or if there is a geographic focus to grantmaking. Even when an organization’s mission is very appropriate, the foundation may already be supporting an organization with a similar profile, and may choose not to duplicate support.
  • New/Latent Relationships – As indicated throughout this post, relationships are singularly important – an organization must understand the importance outreach plays in securing grant support. These may be relationship that already exist, as in a board member who is friendly with a member of the foundation’s staff or board. Or is may be a relationship that does not yet exist, and requires intentional outreach by your organization’s leadership to establish connection. The first stop is typically a program officer or lead contact – it is perfectly acceptable to seek a meeting to discuss programming. Board members may also be successful at connecting with other decision-makers, particularly important in influencing corporate giving.
  • Self Interest – It may be not be obvious, but self interest is a very important factor. For family foundations, recognition opportunities play prominently, particularly in capital asks. In corporate giving, while it may not be considered pure sponsorship, the recognition plan for a charitable gift should be described in detail.

What Next?
In the next installment, Josh will review the process of cultivating gatekeepers and decision makers. To make sure you don’t miss it, subscribe to the blog!

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