Five Questions to Ask Before You Write That Grant

So you have a budget shortfall. Your board looks at the financials, panics, points to the Executive Director, and says, "Why don't you just write a grant?" I'm guessing this scenario sounds pretty familiar. But before you write that grant, it's important to stop and evaluate whether it's worth your valuable time to do so:

1) Are the foundation priorities a fit with your organizational mission?

• You don't want to waste your time writing a proposal that has little prospect of being funded. Take the time to determine if the funders' goals and objectives are a match for your organization.
• Look at the website for funding priorities as well as lists of previous grants to get a sense of what they are looking for and what kinds of organizations they like to support.
• That said, never create a project for a grant proposal simply because it fits into the parameters of a particular foundation unless it represents a clearly defined and authentic effort to meet new needs for your constituency within your stated charitable purpose.

2) What are the odds of actually getting funded?

• Be sure the foundation gives grants in your geographic area, accepts unsolicited proposals, makes grants of a size that is within an appropriate scale for your organization, and actually gives the kind of funding (operating support, capital campaigns, scholarships, ongoing programs, etc.) you need.

3) What's your game plan for the day after the grant period is completed?

• I know you are all looking for ongoing operating support, but don't kid yourself - those kinds of grants are pie in the sky in our current climate. Know that most grants will be for time-limited project support, although you can usually budget a small percentage (typically no more than 10%) for administrative costs in project grants.
• So - assume that any grant will be for one year only and plan accordingly, particularly if your project involves any significant increase in staff and programming.

4) Will this grant contribute to an income stream that is diverse?

• Always seek for a diversity of funding sources, both overall and within income categories (grants, earned income, contributed income).
• Avoid the trap of becoming dependent on one donor for key support, whether it be an individual or a foundation. Some of the worst financial messes I've seen nonprofits get into were precipitated when a long-time donor or foundation stopped providing funding due to a change in priorities or an economic downturn such as we just experienced.

5) Is writing this grant application the best use of your time?

• Don't forge to weigh the benefit of receiving a project grant against the extra work required, including not only time spent writing the grant but also written narrative and financial reports.
• Finally - remember that 75% of charitable dollars in the U.S. comes from individuals (83% if you include bequests and family foundations). A paltry 12.5% comes from foundations. Given your staffing level and/or board engagement, you might be better served strengthening your major donor fundraising efforts.

Five Tips for Building Donor Relationships

So you have a base of donors for your organization. Now the question is how you plan to sustain and build relationships over time with your donors that will continue to support your good work. Here are five tips about how to do just that:

1. Get to know them: Do this through data - and on a personal basis. First gather as much information about them as possible and put it into your database - name, address, phone, cell phone, email, salutation, giving history, direct participation in your organization, special interests, etc. But you also need to take the time through direct personal contact to know them as people - their family, what they care about deeply, why they are interested in your cause.
2. Stay in touch: According to Rockefeller Foundation research, 9% of donors stop giving because they had no memory of supporting that nonprofit. You need to stay in touch about their membership status and gently remind them if their membership has lapsed. You need to stay in touch with reports on your progress and successes through handwritten notes, enewsletters, personal phone calls, and one-on-one meetings. You need to stay in touch sometimes even when you don't want money, simply to maintain your connection, update them on your programs, and solicit their feedback.
3. Communicate effectively: Here's more telling information from the Rockefeller Foundation about donors who stop giving - 5% thought the charity did not need their support, 8% felt they didn't get enough information about how their charitable dollars were being used, and 18% felt communication was poor. Donors want to know where their donations go and what impact your work is having. Be sure to emphasize impact in all of your communications, with a focus on using stories, videos, and photographs to highlight your achievements.
4. Invite participation: Offer them tickets to upcoming events. Invite them for a tour of your facility. Ask them to visit when an exciting program is scheduled. Include them in conference calls. And consider inviting them to volunteer. According to a Fidelity Charitable Gift Fund report, 67% of volunteers make charitable gifts to the organization they volunteer with, and they give 10% more than non-volunteers.
5. Thank them promptly: I cannot emphasize this enough - 13% of lapsed donors were never thanked for their donations. And statistics consistently show that donors who are thanked in a timely fashion give more generously over time. So get those handwritten thank-you letters out. Always express appreciation for their support when you talk to them personally. And be sure to plan an annual appreciation event that is fun, has great food, and is appropriate for your organizational culture.

Think of your relationships with donors as if they are friendships. Treat them respectfully, stay in touch regularly, and communicate honestly and authentically. In doing so, you will strengthen their loyalty to your nonprofit - and you may just find (as I did) that you have also forged true friendships.

Fundraising Takeaways: Giving USA 2013 Charitable Giving Report

The good news is that Americans contributed $335 billion to nonprofit causes in 2013 - a 3% increase over 2012 - and the expectation is that this trend will continue in 2014.

The bad news is that most nonprofit organizations have struggled over the past six years since the economic downturn simply to raise as much as they did beforehand. Compared to previous recessions, this was quite a long recuperation period.

Wealthy donors were the primary source of this increase. These folks donate out of investments and assets rather than income; stock market gains over the past six years fueled the upsurge in charitable contributions. Their favorite causes - donor-advised funds and colleges - benefitted. Additionally, many donors cut back their giving to an average of five organizations during the recession; now this has bounced back to the more customary five to ten.

Here's a breakdown of how each nonprofit sector fared in 2013:

• Education: up 7.4%
• Arts: up 6.3%
• Public and society benefit: up 7%
• Animals and environment: up 6%
• Health: up 4.5%
• Human Services: up a mere .7%
• Religion: down 1.6%
• International Affairs: down 8%

And here are two new strategies that seem to be working around the country:

• Advertising specifically geared to younger folks: I particularly liked this successful fundraising slogan from the Communities Foundation of Texas - "You don't have to be a billionaire to be a philanthropist."
• Programs that appeal to a broader range of the community: The Philbrook Museum of Art initiated free admission Second Saturdays plus increased programming for kids including a special MyMuseum box of art supplies, resulting in a big increase in donations from folks making moderately-sized gifts.

And the fundraising takeaways? The fundraising climate has improved, but it remains challenging - so you need to think strategically and creatively. Reach out to new audiences, clients, and donors. Find out what's working for other similar organizations. Develop a plan that addresses fundraising, messaging, and programming holistically - it's all connected.