When people hear I do grant writing for a living, I often get this: “I want to start a nonprofit organization that does ________ (fill-in-the-blank-mission). Can you get me a grant for that?” I also get frequent calls from people who have taken next steps and are building boards and applying for 501(c)3 status. But, whether the nonprofit is in the idea phase or in its infancy, the reality is that getting that first foundation grant can be next to impossible. Here’s why.
Most foundations are not set up to make grants to start-ups. Many require attachments that include service statistics, a certified audit, or list of other funders. By and large, foundations are looking for a grantee partner that has a positive track record, history of sound financial management and stability, and a broad base and range of support.
In general, foundations do not want to be the only funder of an entire organization, or the first funding in the door. Think of a potential foundation funder like a potential investor in your business. They want to make sure they are investing in a sound organization with a plan for impact and longevity. Look to the individuals who are closest to your organization to be your first funders.
Foundation leaders and people familiar with the nonprofit sector are aware there are already many nonprofit organizations in existence, indicating likely duplication of services. Latest figures indicate there are over $1.5 million in the U.S. As a fellow consultant offered in a recent blog post, “To put that into perspective, that’s one charity for every 300 people.” Sometimes nonprofit organizations are created to provide a service that should really be the program of a larger organization. Nine times out of ten, we can accomplish more when we work together.
Understanding the reality of the grantseeking environment for a new nonprofit is the first step. Below I offer some guidance on what you can do with this information to move toward a successful grantseeking program.
Make sure you have adequately identified and can articulate the community need for your program and organization. Gather data on the subject that can help show that a need exists for the services you provide. Talk to other nonprofit organizations that operate similar programs to determine overlaps, differentiators, and possible collaborations.
Seek out smaller grant opportunities from sources with informal application processes and that have a history of supporting new, unproven organizations. Look for community-based and civic organizations in your location that have giving programs, individual giving circles, youth-directed funding programs, etc. These can sometimes fly below the radar and be tricky to find. If you use Foundation Directory Online, try searching “giving circle” in your keyword or Power Search field. Also look at larger community funders like your city’s community foundation, churches or religious associations, civic clubs, or the local United Way.
One of your first tasks in a new organization should be creating a business/strategic plan that includes an outline of annual expenses and what revenue generating or fundraising activities you will undertake throughout the year to generate enough income to cover those planned expenses. Once the plan is created, work the plan.
Every year the largest percentage of charitable gifts to all nonprofit organizations comes from individuals. Officially this number has hovered around 75% of all charitable giving, but when you include individuals who give through family funds and charitable bequests, it is well over 80%. The power of individual donors to your organization cannot be understated. Make sure you are cultivating and ASKING individual donors to support your organization at least once a year, starting with your board of directors.
If you can accomplish the above tasks, you can start to build some small successes and begin the track record that larger funders are looking for. If you can secure a small grant from a grassroots funder or several individual gifts, use those to kick start your program and treat it like a pilot project. Make sure you have a plan for measuring your success against some pre-determined goals for the program. Tracking data from the beginning to the end of the project that will help you articulate the impact it has made on the community it exists to serve. This will become the start of your track record of success on which you can build in coming years.
Grantseeking for new start up organizations can be a significant challenge. If you follow some of the advice above, it may be a little bit easier. With patience and perseverance, if your organization is truly filling a community need and has developed a sound approach, you may be able to secure more grant funding for your work.
Best of luck!
(This blog post was inspired in part by “Fundraising 101 for Community Programs,” a workshop offered by Neighborhood Connections and The Cleveland Foundation in Cleveland, Ohio on March 13, 2012. This was the first in a series of workshops called Strengthening Services 2012, which are aimed at building the capacity of grassroots and faith-based organizations. Thanks to Janus Small and Tom O’Brien for assistance with this article.