Why Some Nonprofits Are a Fit for Grants, and Some Are Not
Why Some Nonprofits Are a Fit for Grants, and Some Are Not
By Lindsay Jordan, Write On CEO + Founder
I’m not sure who started the rumor that in order to start a nonprofit or launch a new program, all you need to do is win a grant and you’re off to the races. If I ever meet this person, I might kick them in the shin; he’s caused me to pop a lot of balloons, which is something I abhor having to do.
The idea that there is grant funding out there just patiently waiting for the “right idea” to come along is not only untrue, but it also creates a misconception that grants fund fabulous ideas. They do not. They fund fabulous outcomes.
It’s a tough conversation to have with a burgeoning nonprofit leader or even a seasoned veteran of the field that, no, your particular program or idea isn’t a great fit for funding at this time. There are, however, a couple of key criteria that folks might think about when considering if they are a fit for grant funding.
Is a grant the right tool for the job?
One of the things I share with all nonprofits considering grants is that they are a great tool for scaling programs. Grants typically provide large infusions of cash to grow or sustain programs, and sometimes a large chunk of change is exactly what is needed to produce the results you know your nonprofit is capable of.
Grants also have a runway. From the time you qualify an opportunity, cultivate a relationship with the funder, pull together the necessary materials, write and submit the grant, and wait for a response, many months can pass. If you do not have time to invest into the grants process - say, if your biggest financial need is actually keeping the lights on and employees paid - then grants might not actually be the right tool for the job (the Annual Fund would actually be a better tool in this case).
Is your program grant-ready?
As mentioned above, grants typically fund outcomes. And it’s important here to distinguish between an output and an outcome, because we see many nonprofits confusing the two in grant applications. Outputs are actions that the nonprofit completed, for example, serving 500 people, providing 1250 meals, or investing 300 hours of tutoring. Outputs are important, but they don’t tell the whole story.
Outcomes, conversely, measure a change in behavior. For example, of the 500 people served, what percent had a behavior change or positive experience because of that service? Of the 1250 meals provided, how many students were able to better concentrate on their tests? Of the 300 hours of tutoring, by how many points did participants increase their scores? These are outcomes. If your organization is measuring outputs but not outcomes, then your program may not be grant-ready.
Additionally, programs that are grant-ready can demonstrate that they: clearly support the mission of the nonprofit (no mission creep), are easy to articulate, have defined service delivery audiences and measurement tools, and either 1.) do not duplicate services in the market, 2.) build upon services already offered in the market, or 3.) partner with similar organizations in the market to more effectively serve a given audience.
Is your nonprofit grant-ready?
In addition to programs needing to be grant-ready, organizations also need to have their administrative ducks in a row in order to be competitive in grant-seeking. This includes:
Having a board free from obvious conflicts of interest, such as:
A paid staff member serving as a voting member of the board
Rampant nepotism (all board members have the same last name)
Not really having a board of directors
Being able to quickly produce requested financial reports, such as:
Program Budget
Annual Budget
Summary Financial Statement
990 Tax Filings
Audited Financials
Being able to quickly produce other requested documents, such as:
IRS Letter of Determination
Board Roster with contact information
Bylaws, conflict of interest policy, and non-discrimination policy
Bonus points for providing items like:
A strategic plan
A logic model
Grants are not “free money.” Private foundations see their gifts as investments into your programs and outcomes, and like any other financial institution, they invest prudently. Not all nonprofits are a good fit for grants. However, that doesn’t mean that certain nonprofits are unfundable. There are many different types of funding mechanisms available to nonprofits, and if you aren’t a fit for grants chances are that your program and/or organization is likely a fit for some other type of funding. Here are just a few examples:
Program/service fees
Member dues
Earned revenue
Sales
Merchandise
Individual donations
Special events
Giving societies
Direct mail
Crowdfunding
Investments
Planned gifts
Corporate giving
Sponsored programs
Whether you are grant-ready or seeking new fundraising opportunities, Write On Fundraising can help design a program that is custom to your needs. Email info@writeonfundraising.com or call 888-308-0087 to set up a complimentary discovery session and to learn more about how you can put our talented team of fundraisers to work for you!