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Should Your Non-Profit Consider Grant Funding? Things to Consider

Non-profit organizations today are faced with a two-prong problem.  The first is an increase in service demand. With our current economic crisis, as unemployment and foreclosure rates are up, the need for social services also goes up – there are more people in need of more or greater services, more is being asked or expected of non-profit organizations. The second problem is a decrease in overall available funds.  Corporations, foundations and individuals alike are granting fewer funds this year than in the past, and state and federal organizations have been cutting budgets, including contracting with social service organizations.  Organizations are being asked to do more with less.

 With the decrease in traditional funding, many non-profits are increasing their efforts to find funding through foundations and grants – increasing the competitiveness of grants.  Coupled with less funding for granting, the increased demand for grant funds has made the grant writing process even more competitive than in the past as organizations are stepping up their efforts. 

 The decision to pursue grant funding should not be made light-heartedly.  While some grant funding (<$5,000) may be achieved and managed with minimal efforts and oversights, greater awards (>$50,000) require long-term planning, managed oversight and follow-through. 

 Once the decision to pursue grant funds is made, and the organization has developed a written, detailed description of the program they are seeking to fund, the first step is to find potential funders.  In seeking funders, an organization must consider:

  • The size of the grant request;
  • Availability of matching funds – depending on the size of the grant, many funders request matching funds;
  • The nature of the grant – different funders fund different programs based on their on mission; it is important to find a funder that is aligned with your goals and in your field.  Funders-seekers may be aligned by one or more of the following:  
    • Geographic Area
    • Type of Impact – Environmental, Human Services, Education, Research, Clinical, etc.
    • Size of Grant
    • Desired Outcomes
    • Commercial Appeal / Corporate Alignment (corporate funders)
  • Timeline – some grant processes are 30 days start to end, some are 18 months or more; Some fund monthly some only fund once a year; and
  • Availability of Funds – due to decreased giving, some organizations have temporarily halted granting.

 There are hundreds of funding sources, roughly grouped into: Government (Federal and State, and numerous departments and programs within those), Private Foundation, Corporate Giving, Granting Organizations (larger than private foundations).  The process of matching the seeker to the funder is critical, not only to ensure funding, but also to do so without spending years and thousands of man-hours and resources applying for grants that are not achievable for the organization or their desired program.  The process usually requires internet searches, follow-up phone calls, email and mail follow-up.

 Once one or more potential grant sources are identified, grants may be applied for.  Depending on the size of the funds an organization is seeking and the source of the funding, the grant funding process usually includes:

  • Development and Submittal of a Concept Paper – a 2-4 page summary of the organization’s funding request, including organizational background, justification of the funding request, description for use of the funds, description of the desired outcomes, and a description of the evaluation or quality management of the funds.  This may be either a hard-copy or electronic process depending on the organization.
    • If the Concept Paper is accepted, and less than 50% of Concept Papers are accepted, the organization moves into the full application process.
  • Development and Submittal of the Proposal Process – depending on the grant source, the application is usually due within 30 days of notice of acceptance of the concept paper.  The Proposal is usually 10-30 pages and multiple copies may be requested.  The Proposal/Application may include:
    • Coverletter
    • Complete Organizational Financials (current and past year statements)
    • List of members of the Board of Directors
    • Organization’s Background, Purpose, and Accomplishments
    • Justification of Funding Request – why the funds are needed, why is this proposal unique, how does it meet a need that is not already being met
    • Detailed Program Description – what will be done with the funds if they are achieved – in detail
    • Program Timeline
    • Program Outcomes – what will be achieved, description of measureable outcomes
    • Sustainability of the program – how will the grant efforts be sustained
    • Evaluation/Quality Management – how will the program be evaluated, by who and with what measures
      • Fewer than 5% are accepted, the organization moves into the grant period.

 Once an organization moves into a grant period, the individual funder will stipulate when and how the funds will be available and stipulate when and how documentation for the grant activities, including progress reports, financial accounting and outcomes will be submitted.  Organizations usually include a 2-5% overhead cost for administering and tracking grant activities.  Depending on the size of the grant funds, documentation of grant activities may be easy or involve lengthy quarterly documentation.

Posted in Business Development, Fundraising, Grant Writing.

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