By Susan Caldwell
Grants are a great part of a healthy fundraising program.
Having a full grant pipeline means funding for programs, projects, and equipment for your nonprofit.
Last year, U.S. foundations gave away over $88 billion according to the National Center of Charitable Statistics.
That sounds like a lot of money. And it is.
But here’s the bad news: hundreds of thousands of nonprofits are applying for those grants.
The number of nonprofits has grown 20% over the last ten years. Today, there are more than 1.6 million nonprofits in the U.S. alone, not counting the ones in other countries.
What this means is that you simply can’t waste time submitting grants to funders that are unlikely to approve your requests.
You must find your best opportunities.
I remember the first time I tackled grant prospect research. It was over 20 years ago, and the Internet was in its infancy, so there were no foundation websites to explore. We had to purchase big volumes of the Foundation Directory to review foundations.
When I got my hands on that book, I thought I’d found a goldmine! Here was all the money I would ever need – no need to do any other type of fundraising.
At the time, I didn’t understand the importance of building relationships with funders or that there was not an endless supply of money to go around no matter how strong my case for support. After a few rejections and follow-up phone calls, it didn’t take long to realize this was not as easy as it looked.
Eventually, I learned to recognize a good grant opportunity for my nonprofit.
Now I share with you what I figured out the hard way. Here are the top 6 questions to ask yourself when you’re researching grant prospects.
1. Where do they fund?
Most foundations have specific geographic areas they want to fund.
Even foundations that fund nationally often have certain areas of the country or world they are interested in. And it can change from year to year when they re-evaluate where they want to have an impact.
If the foundation’s guidelines are not specific, look through the funder’s 990s at Guidestar.org. The list of grants awarded almost always includes the city and state where the awardee is located.
Is there a pattern? For example, if a foundation is consistently giving grants to one nonprofit in your community, then the interest is probably in that nonprofit and not that community. More than likely, the nonprofit has been singled out by a foundation Board member. If they are giving to a variety of nonprofits in your area, then that foundation is a better possibility.
2. What kinds of programs do they fund?
You need to know if a foundation cares about your cause and if they are trying to impact that issue – homelessness, animal welfare, economic development, K-12 education, etc.
If the foundation funds in your geographic area and is supporting solutions for the problem you are working to solve, keep digging into the guidelines. Otherwise, move on to the next prospect.
3. What types of grants do they make?
Make sure the foundation awards the type of grants you need for your program or project. Does it make grants for operating expenses, salaries, equipment, capital or capacity building? If they don’t provide the type of funding you’re looking for, move on.
4. How much do they give?
It’s not hard to figure out how much a foundation is likely to give your nonprofit.
Again, look closely at its 990s. What is the range of grants? If you are a first-time applicant, choose an amount lower on the range. The largest grants often go to previous grantees and those that have established relationships with the foundation.
Don’t shoot for the moon and ask for the entire amount of your project. It’s unlikely that one foundation will want to fund the whole thing. Study the information you can find about how much they give and make your decision based on that.
5. When do they give?
Determine if the foundation has published deadlines, issues requests for proposals or accepts grant proposals year around. Does the foundation require a letter of inquiry first? Will funding be available in time for you move forward with your project?
Knowing the answers to these questions will help determine if the funding will fit in your program or project timetable.
6. Does my nonprofit have an inside contact with a foundation staff or board member?
A personal contact can be the single biggest factor in whether a grant is awarded, denied, or at least seriously considered.
Always ask your nonprofit’s Board members and key donors if they know someone connected with your grant prospects. Because they just might.
Time spent looking for and vetting foundation prospects is time well spent.
There’s so much more to finding solid grant prospects for your nonprofit than simply finding a match with your mission. You’ll save a lot of time by finding as many answers as possible before contacting the foundation staff with questions.
Do your homework (review the foundation’s 990s or website) then call with questions. Be knowledgeable about their interests and guidelines so you can focus the conversation on your nonprofit’s funding needs.
You’ll be on your way to filling your grant pipeline!